S. Carolina, Nebraska Governors Threaten Vetoes on Fuel Charge Bills in Legislatures

AASHTO Journal, 24 April 2015

The governors of South Carolina and Nebraska are warning they will veto transportation funding bills that appear headed for passage in their legislatures, measures that rely on increases in motor fuel user charges.

The issue pits both states’ Republican chief executives against legislatures under the same party control.

In South Carolina, second-term Gov. Nikki Haley earlier told the General Assembly she would support increasing the motor fuel excise tax by 10 cents a gallon, but only if it came with a larger cut in income taxes and a reform of the Department of Transportation.

However, a measure that passed the House April 15 would only cut income taxes for most taxpayers by $48 dollars a year, to cover the average annual cost of a 10-cent increase in the motor fuel fee that would raise an additional $400 million for the state’s ailing road and bridge network. The House turned aside amendments that would have made big cuts in income levies.

A key Senate leader later said that body would use the House measure as a blueprint for its own legislation.

Haley took the issue to her Facebook account, with an April 16 post that said: “We are seeing a concerning trend. The House passed themselves a pay raise, we vetoed. Then they tried to run up our debt by half a billion, we killed it. Yesterday they raised taxes for a roads plan, without a larger tax decrease, in a year where we have over $400 mill in additional revenues. I will veto it. We didn’t get to the position of being one of the fastest growing economies by sticking it to the taxpayers.”

In Nebraska, the unicameral Legislature voted April 13 to advance a bill, toward a later final reading and passage, that would raise fuel fees by 6 cents a gallon over four years. When fully in effect, it would generate about $76 million a year more for transportation infrastructure spending that would be split between state, city and county governments.

Gov. Pete Ricketts, who took office in January and in February launched a search for a new permanent director of the Nebraska Department of Roads, has said he thinks the next director should be able to assess the department’s needs and financing issues before lawmakers decide to increase taxes for transportation.

In an April 13 press release, Ricketts said: “The Legislature was wrong to advance this big government solution that throws tax dollars at an issue before exhausting other options first. Once again, the Legislature has chosen to prioritize tax hikes over tax relief measures that Nebraskan need and deserve. If this tax increase comes to my desk, I intend to veto it.”

The governor reiterated his opposition a week later, during a television interview about his first 100 days in office.

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