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Otter may get $68 million tax hike for roads

Otter may get $68 million tax hike for roads

Dustin Hurst
March 11, 2015
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March 11, 2015

Gov. Butch Otter may soon get his wish.

Idaho legislators took a step forward in appeasing the three-term governor, who kicked off the year asking for new money for roads and bridges in his State of the State address.

Reps. Greg Chaney, a Republican from Nampa, and Jason Monks, a Republican from Meridian, may hand the governor $68 million next year, a figure far less than other transportation revenue plans floating around the Capitol.

Monks and Chaney teamed up to pitch a new tax hike bill Tuesday, a plan that would hike the gas and diesel levy by 5 cents right at the pump. Additionally, the bill would tack on another 2 cents in the distribution process, which would end up hitting consumers in the wallet, too.

The bill doesn’t stop there, though. It would add a $65 annual fee for hybrid cars, plus a $120 fee for electric cars, levies designed to capture more dollars from the hyper-efficient autos.

Chaney and Monks also want general fund dollars to fund roads and bridges. The state will pitch in a small percent of general fund dollars only if revenue growth exceeds 4 percent. Under the plan, the trigger could be flipped for the first time in 2017.

They believe that will add another $12 million the second year. That amount would be added into base costs, meaning if growth flips the trigger in 2017 and 2018, the state would have $24 million in new road and bridge repair dollars.

With the new gas tax funding and the general fund dollars, Otter could have more than $80 million in new road and bridge cash in 2017.

The general fund dollars would also trigger a reduction in the gas tax. For every $20 million in general fund dollars roads get, the gas tax would drop a penny until the hike is eliminated.

Chaney said the general fund dollars, which Idaho usually spends on education, welfare and corrections, will lessen the burden on taxpayers at the pump.

“Our job is to mitigate the burden,” he said. “I don’t think we can eliminate the burden if we are to grow transportation funds.”

This is the second transportation tax hike bill of the session. House Transportation and Defense Committee Chair Joe Palmer, R-Meridian, introduced the first, a hefty set of tax hikes, fee increases and general fund dollars worth about $200 million annually.

Another tax hike bill, this one authored by House Majority Caucus Chair John Vander Woude, R-Nampa, will hit the Capitol Wednesday through the powerful Ways and Means Committee.

With the session’s duration waning and trying to appease Otter’s demands for more road money, lawmakers seem unsettled about new funding plans.

Rep. Linden Bateman, R-Idaho Falls, wants more money than the Chaney-Monks plan offers. “We need to increase the registration fee to come up with these funds,” he told his colleagues Tuesday.

Rep. Brandon Hixon, R-Nampa, supports the bill as a step in the right direction, but sides with Bateman in wanting more money from taxpayers.

On the other hand, Rep. Patrick McDonald, R-Boise, wants more general fund dollars and fewer direct hikes on people at the pump.

“We’ve got people in this state that are hurting,” McDonald said. “If there’s going to be more money in that general fund, we ought to use it. We are taxed beyond our ability to pay anymore.”

The bill will receive a full hearing in the next week.

Update: The original version of this article said the bill hiked the tax on the distribution process by 3 cents. It has been changed to 2 cents in this article. The correction was made March 18, 2015. 

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