Tom Warne Report, 25 January 2013
Iowa could be nearing a fiscal cliff in maintaining roads and bridges in the state if lawmakers do not raise the state gas tax, according to a warning from the Iowa Good Roads Association spokesman. State officials report a $215 million shortfall in funding for road and bridge projects and, when combined with potential federal funding cuts, plus continually declining state fuel tax collections, state transportation is in danger, said Dave Scott of the Iowa Good Roads Association.
“If you look at our road use tax fund, we have our own ‘fiscal cliff’ coming in 2015,” Scott said. “I mean, it just drops off.”
The director of the Iowa Department of Transportation reported to lawmakers this week that state fuel taxes or “user fees” are a significantly dwindling share of the budget for the state’s transportation system. The state will bring in about $440 million in gas taxes this year, but Iowa vehicle owners will pay $780 million for state vehicle licenses and new car fees. Iowa DOT Director Paul Trombino said that means state citizens pay a “far larger burden” to maintain the roads than the traffic that passes through on the state’s two major interstates.
That means the state’s gas tax only provides 34 percent of Iowa’s budget for roads and bridges. In many states, over half and in some instances up to 70 percent of the road budget comes from the gas tax.
Director Trombino makes a good point. The vehicle license and new car fees are paid by state residents whereas a certain percentage of the motor fuels taxes collected come from those just passing through the state. Those who pass through impact the state’s roads and cause wear and tear seem to get a good deal at the gas pump. You could make a case that raising the motor fuels tax in Iowa would be a good move for the state’s residents as most interstate travelers are not going to divert to another route around the state. TW