Tag: Transportation Trust Fund

Four bits a gallon (or more) for a state gas tax?

Governor Martin O’Malley, he of the trial balloons, may have yet another one up his sleeve.

His latest (of many) tax proposals would extend the state’s 6% sales tax to purchases of gasoline, on top of the current 23.5 cents per gallon surcharge the state takes. If adopted, Maryland would join a handful of other states which use this nebulous practice of profiting off high gasoline prices.

The other states which do this are California, Florida, Georgia, Illinois, Indiana, Michigan, and New York. To see what impact this proposed tax would have on our wallets, we need to use three methods of comparison. First, here are the per-gallon gasoline taxes charged by each of these states and Maryland, ranked lowest to highest, not including sales taxes or various fees added by each state: (Source)

  • Florida, 4 cents per gallon
  • Georgia, 7.5 cents per gallon
  • New York, 8.1 cents per gallon
  • Indiana, 18 cents per gallon
  • Illinois, 19 cents per gallon
  • Michigan, 19 cents per gallon
  • Maryland, 23.5 cents per gallon
  • California, 35.7 cents per gallon

And now the sales tax rates which are (or would presumably be) applied to gasoline, also listed lowest to highest:

  • California, 2.25%
  • Georgia, 4%
  • Maryland, 6%
  • Michigan, 6%
  • Illinois, 6.25%
  • Indiana, 7%
  • New York, 8%
  • Florida, 12%

Finally, the combined bite between all taxes (federal, state, and local) impacting gasoline in the states which charge sales tax, which includes where Maryland would eventually rank. To do their calculations, API uses the average cost per gallon in each state according to AAA as of 1/1/12. For Maryland, I couldn’t find the price on the specific 1/1 date but according to the latest AAA figures, the average price one month ago from today was $3.26 and that should suffice for being roughly the price on January 1st. Again, this is lowest to highest.

  • Georgia, 47.8 cents per gallon
  • Florida, 53.4 cents per gallon
  • Illinois, 57.3 cents per gallon
  • Indiana, 57.3 cents per gallon
  • Michigan, 57.8 cents per gallon
  • Maryland, 61.5 58.9 cents per gallon*
  • California, 67 cents per gallon
  • New York, 67.4 cents per gallon

If this is passed, Maryland would have the fifth-highest total gasoline tax in the country, trailing New York, California, Connecticut (also 67 cents per gallon) and Hawaii (65.5 cents per gallon.) Maryland drivers would be ceding a much higher bite out of their wallets than their neighbors in West Virginia (51.8 cents per gallon), Pennsylvania (50.7 cents per gallon), Washington D.C. (41.9 cents per gallon), Delaware (41.4 cents per gallon), and Virginia (38.2 cents per gallon.) Retailers in those states who are fortunate enough to be close to the Maryland line are probably licking their chops about now.

Of course, this doesn’t factor in the addition of some of MOM’s other trial balloons like a separate 15 cent per-gallon increase in the gasoline tax or increasing the sales tax to 7 percent. And as Todd Eberly points out at The FreeStater Blog, this could all be a feint to make a direct 15 cent additional surcharge more palatable.

As it is currently proposed, the gasoline sales tax would be phased in 2% at a time so drivers wouldn’t be hit all at once. But when they’re projecting $613 million in new annual revenue at a time when the state is over $1 billion in the hole, it will be a surprise if they don’t rush the process. It may get passed this way for now, but wait for the new, improved bill to accelerate the increase next session when money is still tight.

We’re also being told that a gas tax increase is about infrastructure jobs in fixing bridges and roads. But the Maryland Public Policy Institute does a magnificent job of not only blowing that argument out of the water but also pointing out the folly of public transportation while they’re at it. Simply put, it’s another component of the War on Rural Maryland as those of us who drive greater distances because we choose to live away from urban woes will be subsidizing those who ride the buses or light rail in more-developed areas. That group doesn’t quite comprise the 1% but they’re pretty darn close, and they don’t come close to paying their own way.

Putting private transport out of reach to the average family through higher prices also fits neatly into the goals of so-called “Smart Growth” and “sustainable development”, which strives to increase the usage of mass transit. Perhaps this is a line of thought more suited to the tinfoil hat crowd, but one can’t deny it’s much easier to control the population if their movements are controlled.

In any event, the first step in rebuilding Maryland’s crumbling transportation infrastructure needs to come from locking away the Transportation Trust Fund from greedy governors who can’t shake their spending addiction. And if we take back the half of transportation spending we waste on a tiny percentage of commuters and instead gave them a more appropriate share of a nickel per dollar, there are a lot of bridges, road widening projects, and traffic control measures which could be completed for the rest of us who get tired of sitting in traffic.

On the Eastern Shore, we already will bear a significant burden from the newly increased tolls on the Bay Bridge, so we should get a break when it comes to gasoline taxes. The state should quit using the knee-jerk reaction it always seems to have about raising taxes and instead consider spending the vast amounts already collected more wisely.

* I was also taxing the existing tax, not the actual price. Subtract out the 41.9 cents we currently pay in taxes and the sales tax is actually on $2.84 of the $3.26 per gallon.

Scott reveals support group

For most, the contest to represent the Maryland Republican Party nationally as National Committeewoman has no meaning and is just another example of the “inside baseball” of party politics. But those who are astute should see the parallels between this race and the power struggle within the Republican Party on a national level.

To review, last month current state National Committeewoman (and onetime MDGOP Chair) Joyce Lyons Terhes announced she would not seek another four-year term in the post. To date two contenders have announced their intention to seek election – former YRNF Chairwoman Nicolee Ambrose and former state party Chair Audrey Scott. Anyone who’s paid attention to this space has seen me rake Audrey Scott over the coals for her participation in a rally supporting an increase in the state’s gasoline tax and, secondarily, for locking up the Transportation Trust Fund to prevent it from being raided every time Martin O’Malley needs to balance his budget. (The latter I’m fine with, but not the gas tax increase. Correctly prioritize what we have first.)

Audrey Scott, though, has a lot of backers who don’t mind that misstep with six members of the MDGOP’s executive board, six of the 24 local county Chairs, 24 of 43 Delegates, and 5 of 12 Senators on a list of endorsers Audrey has on her Facebook site devoted to the race. On the other hand, Ambrose has fewer elected officials supporting her (only Delegates Donna Stifler and LeRoy Myers, Senator J.B. Jennings, and U.S. Senate candidate Dan Bongino have expressed their support for Ambrose) but far more “likes” on her campaign’s Facebook page (143 vs. 17 for Scott.) Perhaps that’s a generational thing, but in any case the votes which will count are coming at the party’s Spring Convention April 27-28 – over three months from now.

(This upcoming state convention will also feature the election of ten Delegates and ten Alternate Delegates to the Republican National Convention. I unsuccessfully ran for this in 2008 but will take a pass in 2012 since I have something far more important to attend to that month and money enough for just one trip. We also elect a National Committeeman but thus far I’m unaware of anyone who will challenge current officeholder Louis Pope.)

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An update on the Audrey Scott flap

Obviously this story from yesterday has gotten a little bit of play around the state because former MDGOP Chair (now National Committeewoman candidate) Audrey Scott claimed we bloggers got it wrong.

(Insofar as I know, those “bloggers” would be me. Richard Cross of Cross Purposes made the statement as part of linking to the Washington Post story on Facebook, and I just pointed to his site as a professional courtesy. To date he hasn’t weighed in on the subject on his site.)

Regardless, Scott’s contention is that she was only at the rally to support protecting the Transportation Trust Fund (TTF), a position she staked out at Kevin Waterman’s Questing for Atlantis website. Apparently she also defended herself at the Montgomery County Republican Central Committee meeting, according to county Chair Mark Uncapher.

But Mark also sent along a link to the press release the Greater Baltimore Committee did regarding the rally, noting that their Chairman also served on the Blue Ribbon Commission which recommended the gas tax – along with a slew of other fee and toll increases and enactments, including “development of revenue mechanisms that are directly tied to the use of the transportation system…commonly referred to as mileage-based or vehicle miles traveled (VMT) charges” –  in the first place. (Not only that, those who are up in arms about PlanMaryland should also pay attention to Issue Area III in the 32-page report.) The rally’s basic purpose was to show support to the General Assembly for raising $800 million annually in revenues for the TTF, according to the GBC release. A tax increase is also part of the GBC legislative agenda.

To be fair to Audrey, neither she nor Doug Duncan, who was also quoted in the Post article (which was a reprint of an AP story), was a featured speaker at the event. Apparently she was a face in the crowd who wanted to lend her support for the protection of the Transportation Trust Fund. Certainly I would like to see the TTF protected as well – if we have to have any gas tax, it should go to keep up roads and bridges. Mass transit should pay its own way, although the Blue Ribbon Commission believes farebox collection should only make up 35% of operating revenues. So much for building bridges and highways.

But as I said yesterday the perception of Audrey Scott, who is a symbol of the Maryland Republican Party, being at a pro-tax increase rally was something the Post would seize on to undermine the principled position Republicans in the General Assembly would stand upon that we are taxed enough already. It doesn’t necessarily matter what she actually said, for perception is often reality.

On the other hand, if we eliminate the items which aren’t germane to transportation infrastructure, like mass transit, and pass the legislation already introduced by a bipartisan coalition that would protect the TTF, we can see what can be done under the existing tax structure first.

Let me state for the record that I haven’t made up my mind in the National Committeewoman race yet. But when Audrey Scott is already infamous in some quarters for her “party over everything” statement, she’s already behind the 8-ball with a lot of Republican regulars and supporters. And I come from a muckraking county Central Committee which definitely goes against the flow the establishment attempts to create because we have a heavy TEA Party influence on our body, so Audrey already has a tough sell locally.

Now if you want to know what was said at this rally, the Greater Baltimore Committee has a YouTube channel with four videos of the January 19 event. None of them feature Audrey, so presumably the AP stringer covering the rally recognized her as someone important and got her take. But what I did hear being said was speakers who were only too happy to raise our taxes, with the TTF protection being secondary at best.

Judge for yourself whether you agree with me that her attendance wasn’t a politically wise choice.

Update: Scott has garnered a key local endorsement. District 38B Delegate Mike McDermott wrote in a note to local Central Committee members:

I ask you to give strong consideration to (Audrey Scott’s) candidacy as I know that she has everything it takes to represent the interests of Maryland and our party to the uttermost.

He also pointed out Scott’s involvement in the Ehrlich administration as Secretary of Planning. One thing in Scott’s favor: no move toward a PlanMaryland was made during her tenure there.

Is this the way to win an election?

Last night I was tipped off (h/t Richard Cross of Cross Purposes) to a Washington Post item regarding bipartisan support for the gas tax increase. Yes, you read that right – bipartisan.

It seems our Chamber of Commerce types have the misguided notion that increasing the gasoline tax will allow the state to fully fund transportation projects, but I ask of them: what planet are you living on again? This is Martin O’Malley’s Maryland – we all know that the money is going to be spent on 1,001 items in the general fund and the rest will go to build more mass transit and bike paths we don’t need.

Meanwhile, the victims of the War on Rural Maryland will have to once again pay through the nose perpetually, because as proposed by one possible scheme advanced by a state commission the gas tax isn’t just going to go up a nickel each year in 2013, 2014, and 2015 – nope, it’s going to be indexed afterward to a construction cost index. So as union demands get more and more brazen and the cost of construction climbs at a dizzying rate, so will the gas tax. Nice system if you can con people into believing the roads will actually get fixed.

Continue reading “Is this the way to win an election?”