gas taxes

Gas station group fights ‘indexing’ provision in Haslam tax plan

Tennessee gas station and convenience store operators are fighting a provision in Gov. Bill Haslam’s gas tax increase plan that would index future fuel-price hikes every two years to the rate of inflation, reports the Times-Free Press.

In a letter sent last month to legislators, Emily LeRoy, executive director of the Tennessee Fuel and Convenience Store Association (TFCA), called the indexing provision a “blank check” for state government.

“We believe our customers will oppose an automatic tax increase, which is anti-consumer and contrary to Tennessee’s reputation as a fiscally conservative state,” the letter states. “We want to support this legislation, but cannot be supportive” if that’s included.

LeRoy told the Times Free Press via email last week the association is not fighting Haslam’s plan to hike fuel taxes by 7 cents per gallon for gasoline and 12 cents per gallon for diesel, just the indexing proposal.

…”It is our strong belief that tax increases should be publicly debated, with opportunity for voters to agree or disagree with the associated spending and that legislators should vote on every increase,” she said.

… The governor and his immediate family are majority owners of Pilot Flying J, a chain of travel centers across Tennessee and the U.S.

While Pilot is a member of the TFCA, a source with direct knowledge of the company’s position said the Knoxville-based chain isn’t involved in TFCA’s fight against the indexing provision.

… Haslam’s press secretary, Jennifer Donnals, defended the index provision, saying the governor “proposed the IMPROVE Act to build and sustain the state’s economic growth and competitiveness, and indexing is an important piece to make sure we can provide a safe and reliable network for the next generation of Tennesseans.”

As for Pilot, Donnals said, “We speak for the governor, not Pilot, and we look forward to Wednesday’s discussion about providing Tennessee with a safe and reliable transportation network in a fiscally responsible way.”

Mike Williams, executive director of the Tennessee Petroleum Council, a trade association for energy companies doing business in Tennessee, said the group would “prefer not to have indexing but that’s a decision the General Assembly is going to have to make about whether they want automatic tax increases or that tax increases should be voted on one at a time.”

TDOT gives IMPROVE a SPOT online

In promoting Gov. Bill Haslam’s gas tax plan to IMPROVE Tennessee roads, the Department of Transportation’s website has a new feature – an interactive map of all projects that could be funded with more money. And, of course, it has a new acronym: SPOT (Statewide Project Overview Tracker).

It’s HERE. The welcoming message reads;

Welcome to the SPOT website. This website is designed to provide you with an interactive tool to navigate priority transportation projects across the State of Tennessee. This application is a project overview tracker of county, TDOT region, and legislative districts for you to view basic details for transportation infrastructure, safety and economic development in locations that are important to you.

The projects are also categorized by their program type describing the primary benefit they offer the public of the State of Tennessee.

Note: ICYMI, IMPROVE stands for Improving Manufacturing, Public Roads and Opportunities for a Vibrant Economy. TDOT is the Tennessee Department of Transportation (pronounced tee-dot).

NFIB survey finds slim majority opposed to Haslam’s gas tax

News release from National Federation of Independent Business

NASHVILLE, Feb. 13, 2017—Tennessee members of the National Federation of Independent Business, the nation’s leading small-business association, are giving mixed reviews of Governor’s Haslam’s proposed IMPROVE Act, which includes an increase in the state gasoline and diesel taxes.

“NFIB’s policy positions are based on the direct input of our members,” said Jim Brown, state director of NFIB. “When we surveyed our members this month about the governor’s Improving Manufacturing, Public Roads and Opportunities for a Vibrant Economy Act, there really was no clear consensus, at least on the question of a tax increase.”

When asked if they support or oppose a proposed seven-cent increase in the gas tax and 12-cent increase in the diesel tax, 55 percent of NFIB members responding to the survey oppose, 40 percent support, and 5 percent are undecided.

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Harwell’s gas tax comments clarified (well, sorta)

House Speaker Beth Harwell says she could support some fuel tax increases for new road spending, provided the state’s gas and diesel taxes don’t exceed the highest rates in the eight surrounding states, reports the Times-Free Press. But it seems the way she initially phrased her remarks left some questioning whether that standard would be violated by Gov. Bill Haslam’s proposal.

During a Tuesday question-and-answer session with independent business owners, Harwell said “what we need to be careful of is that we never want to have our gas tax higher than the states around us, and never want to have our diesel tax higher than the states around us.”

In response to subsequent comments from reporters that Tennessee’s existing gas and diesel taxes already exceed some adjoining states’ rates, Harwell spokeswoman Kara Owen on Wednesday clarified the speaker’s remarks, saying Harwell “was referring to not wanting to be higher than the highest states around us.”

That’s an important distinction. Haslam is proposing raising the current 21.4-cents-per-gallon gas tax by 7 cents and boosting the existing 18.4 cents on diesel by 12 cents.

According to the American Petroleum Institute, Tennessee’s gas tax, which hasn’t been raised since 1989, is the third lowest of the nine states when other fuel-based taxes and fees are included.

If Haslam’s proposal is approved, which is far from certain, Tennessee’s resulting 28.4 cents tax on gas would be the third highest among the states, exceeded only by Georgia (31.1 cents) and North Carolina (34.6 cents).

The speaker’s comments Tuesday were Harwell’s fullest yet on the fuel tax increase proposal and transportation funding.

… Tennessee’s current diesel tax rate is tied with Mississippi as the second lowest among the nine states. If Haslam’s proposal were approved, the resulting 30.4 cents per gallon on diesel would make Tennessee’s rate the third highest, behind Georgia (34.2 cents) and North Carolina (34.6 cents).

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Poll finds 28 percent GOP support for gas tax increase, 15 percent opposed

Tennesseans for Conservative Action, a “voter education” group set up in 2015 by Republican political activists/lobbyists Mark Braden and Gregory Gleaves, has issued some findings from a poll of 600 “reliably Republican voters” on a proposed state fuel tax increase.

Here’s the summary version on that one issue:

Gas Tax: Governor Haslam has proposed a tax increase of 7 cents on each gallon of gasoline. Which of the following most closely matches your current feelings on the proposed bill?

21%: Support the gas tax increase to fund road improvements to ensure TN’s roads will be safer

7%: Support the gas tax increase to fund road improvements to ease traffic in my community

53% We should spend the $1 billion surplus before raising taxes.

15% I oppose the gas tax no matter what.

The poll covered other areas — Sens. Lamar Alexander and Bob Corker have high approval ratings, but not as high as Donald Trump. And 52 percent the surveyed Republicans indicated support for medical marijuana.

The full news release (which has no details on questions or methodology)  is HERE.

Note: A 2015 post on launching of TCA is HERE. (Robin Smith advises she is no longer active in the group.)

DUI enforcement cut by governor’s ‘open container’ proposal

As proposed, Gov. Bill Haslam’s transportation funding package would eliminate 57 positions dedicated to enforcing drunken driving laws by district attorneys general staff across the state. The Times-Free Press reports the governor is open to address the resulting concerns of prosecutors.

The provision in question in the governor’s legislation, which would also raise fuel taxes, would outlaw open containers of alcoholic beverages in cars on the road. Because Tennessee doesn’t already have an open container prohibition, $18 million in federal highway funds cannot be used for road construction and maintenance and instead goes to other programs – including $6.5 million now used for special DUI prosecutors, training and police overtime for DUI enforcement. With passage of the governor’s plan, all $18 million would be shifted to road construction.

“We’re aware of that,” the governor said last week. “We fund some DUI [enforcement], DAs through that. We’re willing to look at other ways to make sure that function gets paid for. We realize that’s critical.”

…Jerry Estes, former 10th Judicial District attorney general and now executive director of the Tennessee District Attorneys General Conference, recently said DAs in 25 of the state’s 31 judicial districts rely on the funding. He said prosecutors are hoping to work something out.

“Our concern is 57 positions that would be lost if they’re not funded another way,” Estes said. “And what those 57 positions do, they’re very involved, of course, in prosecuting DUIs and vehicular homicides.”

Moreover, Estes said, the money also helps train sheriffs, police departments, the Tennessee Highway Patrol and other enforcement agencies to combat DUI and impaired driving.

“Tennessee’s DUI deaths on the highways have gone down greatly since these programs have been in place,” said Estes, who called them “very crucial” to that success.

…Rep. William Lamberth, R-Portland, a former prosecutor, said the $18 million, including the $6.5 million that now goes to prosecutors, needs to be replaced.

“If we can take $18 million out of the general fund and allocate that towards safety, specifically toward 57 positions in the district attorneys’ offices, officer overtime, roadblocks and advertising to combat intoxicated driving, I think that’s a great solution,” Lamberth said.


Haslam said “not having the open container law has meant that the federal government’s telling us how we can spend that $18 million.”


“I think we should choose how we spend that and then to decide do we want to fund DUI, DAs another way,” the governor said. “But in the meantime, money that should be going to roads should be going to roads.”

GOP game of ‘bumper cars’ jeopardizing road funding legislation?

House and Senate Republican leaders “are playing bumper cars” with conflicting notions of how to increase funding for Tennessee transportation projects, suggests the Times-Free Press, and that could dim chances of any legislation passing the General Assembly.

Earlier, Gov. Bill Haslam proposed raising fuel taxes to provide more money. House Republicans on Wednesday proposed to instead divert sales tax money to roads, suggesting Haslam’s proposal could be killed in committee. On Thursday, Senate Republicans spurned the House plan.

(Lt.Gov. Randy) McNally, who has seen the impact of recessions on Tennessee finances in 1981, 1991, 2001 and 2008, warned the economy is cyclical and sales taxes take a nose dive when a downturn strikes. It’s been nine years since the last recession, he noted.

“Our economy runs in cycles,” the Oak Ridge lawmaker said. “I’m hopeful with the new president we can extend our run, but nine years is a long time to have growth in the economy.”

Sen. Jim Tracy, R-Shelbyville, a former Transportation Committee chairman, argued that relying on the sales tax for a set amount of revenue in a state that has a pay-as-you-go policy on road construction and maintenance is too risky.

And Senate Majority Leader Mark Norris, R-Collierville, questioned why House proponents didn’t come speak to him. He said he can’t tell at this point whether Hawk’s proposal will be one of several debated to change Haslam’s yet-to-be-introduced bill or as a separate measure.

“It’s better to work together toward a common end,” Norris said. “If the game is to divide and conquer, then the game is over. If it dies in the House, it dies.”

… Haslam, meanwhile, told reporters Thursday his bill will put gas tax increases and tax cuts in other areas in one package. Describing gas taxes as “user fees,” the governor argued it’s the fairest way to fund transportation needs.

“I don’t like the idea that somebody that barely drives has money go to subsidize a road for somebody from California that’s driving down I-40,” Haslam said. “That just doesn’t seem fair.”

Further from an Associated Press report:

Meanwhile, Americans for Prosperity, the advocacy group founded by billionaire brothers Charles and David Koch, wants to earmark $200 million from the general fund each year for the next decade to pay for infrastructure projects.

Andrew Ogles, director of the group’s state chapter, argued during a news conference Thursday that he doesn’t think there is any urgent reason to act, especially when the state is flush with a more than $1 billion surplus, and is projecting revenue growth of nearly the same amount.

“When you have a billion-dollar surplus in recurring revenue being paid by hardworking families, you don’t raise taxes,” Ogles said. “That is nonsensical, that is disingenuous, and quite frankly, I would call it theft.”

Democrats compared the GOP response to Haslam’s gas tax proposal to the Republicans’ rejection of the governor’s Medicaid expansion proposal in 2015.

“It’s Groundhog Day, and here we are four days into the session and the supermajority has sabotaged the governor’s key initiative,” said Senate Democratic Caucus Chairman Jeff Yarbro.

Ramsey signs up to advise coalition pushing gas tax hike

Recently retired Lt. Gov. Ron Ramsey is joining the newly created Advisory Council of the Transportation Coalition of Tennessee, reports the Nashville Post — presumably to help the promotion of Gov. Bill Haslam’s IMPROVE Act, which includes a gas tax hike.

Rumors have been swirling that Ramsey would be working as a “consultant” on occasion during session, possibly in advance of setting up shop as a registered lobbyist next year, after the one-year cooling off period has ended. And now he’s advising a group pushing for an increase in the state’s transportation funding — some with very vested interests in seeing more new roads built.

The Transportation Coalition press release is below.

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The Hawk option: No gas tax hike, just send sales tax money to roads

Two top House Republican leaders on Wednesday countered Gov. Bill Haslam’s proposed gas tax increases with an alternative plan that calls for diverting money from the state’s existing 7 percent sales tax base to fund needed road improvements, reports the Times-Free Press.

“A quarter percent of one percent of those funds [we] would simply allocate to transportation funding needs,” said Assistant Majority Leader David Hawk, R-Greeneville, who unveiled the plan at a news conference with Majority Leader Glen Casada, R-Franklin.

Haslam’s plan seeks to raise the existing 21.4-cents-per-gallon gas tax by 7 cents and the 18.4 cents diesel tax by 12 cents. He says the hikes are necessary to tackle the state’s estimated $10.5 billion backlog of nearly 1,000 transportation projects.

Fuel tax increases, the first since 1989, would raise an estimated $227.8 million for state needs and another $117.1 million for cities and counties under statutory sharing provisions.

Other aspects of Haslam’s plan include raising vehicle registration fees and imposing a $100 annual fee on electric vehicles. That raises an additional $51 million for a total of $278.5 million for state projects.

Hawk said his plan is far simpler and involves no tax increase. Diverting a quarter percentage point of Tennessee’s 7 percent sales tax to transportation funding, he said, would provide two-thirds, about $194 million, for state roads and some $95.5 million for cities’ and counties’ combined share.

Note: Over in the Senate, the proposal got a chilly initial reception. Statement from Lt. Gov. Randy McNally below, along with the Hawk press release.

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Haslam sends $159M road wish list to Trump

The Haslam administration has submitted a seven-item list of priority state road projects totaling $1.16 billion for President Donald Trump’s administration to consider, reports the Times-Free Press.

Tennessee is among states that have offered up such lists of “shovel ready” but unfunded projects to the National Governors Association at the request of Trump’s then-transition team.

…Trump’s request didn’t seek cost estimates but figures provided Wednesday by the Haslam officials to the Times Free Press shows a price tag on the planned improvements of the highway and bridges is projected at $159.4 million. 

Haslam, meanwhile, is in the midst of his own pitching his own transportation and economic program, dubbed the IMPROVE ACT, that would raise an additional $296 million for state transportation, primarily through gas and diesel tax increases, to address 962 projects statewide. 

The state currently has a $6 billion backlog of previously approved projects and $4.5 billion worth of projects with no funding expected for years unless new dollars are forthcoming, Haslam has said.

…The Volunteer State list includes a stretch of U.S. 127 in Cumberland and Fentress counties north of Chattanooga. 

In addition to U.S. 127, other projects on the list being forwarded to the Trump administration are:

* Alcoa Highway – Knox County/Blount County – $183.1 million
* Lamar Avenue – Memphis – $252 million
* I-440 – Nashville – $50 million
* State Route 109 – Wilson County – $18.5 million
* I-40 – Jackson – $66.3 million
* I-69 – Obion County – $236.7 million.


Former Knoxville News Sentinel capitol bureau chief Tom Humphrey writes about Tennessee politics, government, and legislative news.

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