Midstate mayors push for gas tax increase

Friday, March 20, 2015, Vol. 39, No. 12
By Hollie Deese

A lot has changed in Middle Tennessee’s cities, towns and communities since 1990. Tennessee’s fuel tax has not.

The Middle Tennessee Mayors Caucus met at the end of 2014 and took a hard look at how the state’s gas and fuel tax, which provides funding for transportation improvement, is stuck in 1990. Meanwhile, mayors are dealing with the realities of serving a fast-growing and booming region in 2015.

The tax is set at 21.4 cents per gallon and has been since 1990. From that 21.4 cents, 7.9 cents goes to local governments, 12.8 to the Tennessee Department of Transportation and the remainder to the state’s general fund.

Forty strong, the mayors’ group sees an urgent need for an increase in the tax to keep up with inflation and deal with transportation issues and has placed increasing the tax at the top of their legislative agenda.

Gov. Bill Haslam said at a Tennessee Press Association meeting last month this year’s chances of an increase are unlikely.

The federal gas tax that funds the U.S. Department of Transportation Highway Trust Fund is 18.4 cents and hasn’t been increased since 1993.

“The gas tax is pretty important to us as a community on a federal and state level,” says Franklin Mayor and caucus chair Ken Moore.

“That is how our roads are funded, through federal and state gasoline tax. And it hasn’t changed in years. Everything else has gone up, the cost of paving has gone up, and we have continued to grow.”

Weather drains resources

But transit projects still need funding, and winter’s relentless rough weather hasn’t helped matters.

Heather Jensen, community relations officer with the Tennessee Department of Transportation, says the department had already spent nearly $3.4 million on costs associated with the weather before the early March storm.

“TDOT budgeted $3.7 million for winter 2014-2015,” Jensen says. “Any overages are taken from the department’s maintenance budget, which is funded with state dollars collected from the gas tax.”

Those costs, Jensen adds, are somewhat non-negotiable because they are necessary to ensure the continued safety and operation of the highway system.

“Future funding is a concern for the department, but the larger concern is the lack of federal money, which pays for new construction,” she says. “Without resolution to the current federal funding crisis, TDOT will become a ‘maintenance only’ department.”

TDOT’s annual budget is $1.8 billion, and the departments spend an average of $326 per Tennessean building new roads and maintaining old ones. Congress has not completed a full six-year highway bill, and TDOT relies on the highway bill for scheduling projects. The total amount in backlogged projects for TDOT is $8B.

“Lower-mileage vehicles and battery-operated vehicles aren’t paying any of the gasoline tax but are still using our roads,” Moore says.

“The dynamics have changed. I look forward to the legislature looking at some sustainable form of funding, and I look for the federal government to find some kind of sustainable funding for our transit projects going forward. And the gasoline tax is – it seems to be the most common option mentioned.”

Work continues, but modified

In Franklin, there is a list of capital projects, some of which are state funded. One of them is the northwest expansion of Mack Hatcher.

“Originally it was supposed to be a four-lane project, but just because of the constraint that the state has as far as funding, we as a city decided to grade for four lanes, build two lanes, and we will pay for the multi-use path along it,” the mayor says. “That is somewhere in the $25-30 million range. We have already spent between $5-7 million on it ourselves to try and move it along.”

Moore ssays he appreciates that Tennessee is a pay-as-you-go state with no road debt, but says change is needed to keep up with the area’s growth.

“We have some of the best roads in the nation, but I think that Tennessee would slip into a state of just maintaining what we have if there isn’t some change,” he explains.

“It is critical for us to be able to continue to grow and thrive economically to make sure something is done about a sustainable source of funding for our transit issues.”