Former Gov. Paul LePage and other Republicans target gas tax amid record fuel price spike, but proposed cuts pushed back by groups fearing short-term revenue loss could hurt funding roads and bridges and shifts the burden to other taxes.
It comes as the average regular gas price in Maine hit a record high of $4.19 on Tuesday, according to AAA. Prices are expected to continue to climb as the Russian invasion of Ukraine limits oil supplies. Gasoline prices, although not included in the most common measure of inflation, have been one of the most visible signs of high prices in the United States in recent weeks.
Republican calls to address the gas tax are a bid for political distinction with Governor Janet Mills, a Democrat who has tailored her calls to return half of a massive state surplus in a plan to send checks to families. But transportation and business advocates warn that suspending the gas tax could threaten Maine’s infrastructure or require funding changes from other sources.
LePage focused on fuel prices at a rare campaign press event in Yarmouth on Tuesday, calling on Mills and the Legislature to temporarily cut the gas tax by at least half. He also called for the removal of tolls on Maine’s turnpike for “at least 90 days,” noting that the summer tourist season was a good time to bring it back so out-of-state travelers can endure a most of the burden.
“When I travel around the state, everyone I meet is worried about the costs of food, heat, electricity and gasoline,” the former governor said.
LePage targeted fuel taxes early in his term as governor, signing a bill in 2011 to end the annual practice of inflation-based indexing. The tax, which increased slightly each year, has remained constant at 30 cents per gallon since then, making up a smaller share of funding for Maine’s roads and bridges in inflation-adjusted dollars.
His pleas are likely to go unheeded in the Democratic-controlled legislature. Top lawmakers have already expressed skepticism about targeting the gas tax, which accounts for the bulk of public funding for transportation projects, after Rep. Laurel Libby, R-Auburn, introduced a proposed legislation to eliminate the tax until the end of 2022. Mills’ office did not rule out the idea on Monday but instead pointed to the control plan.
But the proposal to reduce or eliminate the gas tax even temporarily met with broad pushback Tuesday from the Maine State Chamber of Commerce and other groups, citing its effects on funding for businesses. transport. Maria Fuentes, executive director of the Maine Better Transportation Association, said proposals targeting the gas tax “are good, but they won’t work.”
A three-month gas tax suspension would cost about $57 million, while stopping tolls over the same period would likely cost the Maine Turnpike Authority about $36 million, the data shows. Much of it would be saved by Mainers avoiding tolls or paying lower prices at the pump, although some would be clawed back by out-of-staters. This is a small fraction of the proposed relief checks, which are expected to cost the state just over $600 million.
Toll revenue accounts for nearly all of Maine’s Turnpike maintenance funding, while it accounts for a plurality of state funding for Maine Department of Transportation projects. State funding is also required to receive some federal matching funds, Fuentes noted.
A decline in gas tax revenue would force the agency to postpone planned work or seek other sources of funding, such as the general fund or bonds, which would redistribute the cost to road users more widely. to taxpayers. The state is also sitting on a budget surplus of about $1.2 billion. Not all the money was allocated in Mills’ spending plan.
In the absence of gas tax revenue this summer, when Maine sees many foreign visitors, cities and towns could turn to greater use of property taxes to fund road maintenance, a warned Rebecca Graham, legislative attorney for the Maine Municipal Association.
“The fuel tax revenue is the only contribution these visitors make to the funding mechanisms that support road maintenance and repair,” she said.
BDN writer David Marino Jr. contributed to this report.
