The Senate Transportation Committee Tuesday reduced the gas-pump burden on the state’s drivers in its plan to raise additional funds for roads and bridges, cutting the proposed state fuel excise tax by a nickel a gallon from the House’s legislation.
“One of our goals in the Senate was to keep gas prices as low as we can,” said Senate Transportation Committee Chairman Tommie Williams, R-Lyons. Lyons took the lead in writing the Senate’s version of the legislation, but it was presented to the committee by Sen. Steve Gooch, R-Dahlonega, the Senate majority whip.
The Senate bill would collect a 24-cent-per-gallon state fuel excise tax instead of the House bill’s 29.2 cents per gallon. It would also tax diesel fuel at the same amount, rather than the House’s 33 cents per gallon for diesel. Williams said 20 cents of the 24 cents in the Senate bill would be “revenue neutral.”
However, the Senate plan adds an annual highway user impact fee of $25 for passenger vehicles, $50 for big trucks and buses and $10 for motorcycles, The fee would be paid when vehicle tags are renewed.
Another major change would allow local governments to remain with their current sales tax structure, with expenditures allowed for purposes beyond transportation. The House bill sought to restrict fuel sales taxes for transportation uses, which resulted in some counties facing huge deficits and others enjoying surpluses.
However, school boards, counties and cities would be capped at $3.39 a gallon, the average for the last four years. If gasoline prices rise beyond that amount, the local governments would not receive the corresponding higher revenues.
Gooch said that restricting the local gas sales taxes to transportation brought conflict among cities and counties, with some gaining and others losing.
“We felt like the effort wasn’t worth the returns,” Gooch told reporters. “We’re going to leave local governments alone and focus on the state revenue side.”
However, local governments want the gas tax amount indexed, as the state fuel excise tax would be under the Senate bill. Clint Mueller, legislative director of the Association County Commissioners of Georgia, said he expects the indexing for local governments to be included in the legislation.
The Senate legislation also imposes a $5 fee on rental cars, but Williams indicated a willingness to change that when an Enterprise rental car spokesman said the company already pays a variety of fees.
Along with removing the $5,000 tax exemption for electric cars and the airlines’ motor fuel tax exemption, the Senate bill would also end the sales tax holiday for back to school purchases.
The bill would also give the state Department of Transportation an additional $250 million from the state general fund for debt relief. Williams said the DOT is paying $400 million a year in debt service, and that is handcuffing the department, not giving it enough money to begin projects.
Gooch told the committee the money would come from rising revenues in the state budget, and would not be a set annual amount. The money would be in addition to the so-called fourth penny of the state gasoline sales tax also going to the department through the conversion of the tax into the single excise tax.
Sen. Valencia Seay, D-Riverdale, objected to the $250 million DOT appropriation, saying that would come at the expense of education, for which Gov. Nathan Deal proposes increased expenditures in his Fiscal Year 2016 budget.
“Education is No. 1 for me,” Seay said. “If we’re committing $250 million off the cuff annually, how will that affect education? I’d like to see education as a set aside.”
Gooch said that the DOT expenditure would not hurt schools. “Nobody here wants to take any money from education,” Gooch said. “When it deals with general funds, revenue is revenue.”
Seay also said she wanted assurances beyond a letter from the DOT that minority and women contractors would get a share of the increased transportation funding. Seay and the other two minority members of the committee voted against the bill, which contains no provision for minority contractors.
Now, the bill goes to the full Senate, and if it passes there, it would go back to the House for a vote. If the House doesn’t agree to the Senate changes, a conference committee would have to resolve differences for both chambers to again vote on the legislation.
