Transport Commission: Network at Tipping Point, Let’s Raise Taxes

By Mark Stiles, January 7, 2013, Puget Sound Business Journal

Washington’s transportation network is “at a tipping point of failing to meet our basic needs,” according to the state Transportation Commission, which is recommending a higher gas tax and restarting the motor vehicle excise tax.

The two moves would raise nearly $7.7 billion over 10 years for projects that the commission said would improve the state’s economic competitiveness and make roads safer.

In addition to phasing in a 10-cent-per-gallon gas increase and levying a motor vehicle excise tax, commissioners are recommending that the state raise the “gross weight fee” by 15 percent on trucks that weigh 10,000 pounds or more.

The result would be higher prices at the pump and at the store because, “If we use it, a truck has brought it, to use an old cliché,” said Jim Tutton, vice president of the Washington Trucking Association, a 900-company group.

State Rep. Judy Clibborn, D-Mercer Island, chair of the state House Transportation Committee, was briefed on the commission’s proposal Monday. “I like their work,” she said, but she thinks the proposed motor vehicle excise tax is too high.

“I would prefer to have something smaller and more defensible,” said Clibborn, who plans to combine some of the commission’s ideas with others for debate during the upcoming session.

Something has to be done, transportation commissioners said. In a letter to legislators, Commission Chairman Dan O’Neal wrote that the state has “invested significantly” in improving the system over the last 10 years “but has fallen behind in maintaining and preserving the existing transportation system.”

Up to $50 billion worth of work could be done, according to the Connecting Washington Task Force, which Gov. Chris Gregoire appointed. Realizing that would be too big an undertaking, task force members distilled the number down to “a constrained funding need” of $21 billion, said Noah Crocker, the Transportation Commission’s senior financial analyst.

Of that amount, $10 billion would go to maintaining and operating state and local roads, transit agencies and Washington’s ferries; and $11 billion would fund capital improvements.

Washington’s gas tax is currently 37 ½ cents a gallon. Commissioners said raising that by 10 cents over six years would ultimately cost the average driver $60 more a year. Currently, the average driver pays $225 a year in fuel taxes.

Under the commission’s proposal, Washingtonians would have to pay the motor vehicle excise tax, or MVET, again. In 1999, state voters approved an initiative doing away with the tax.

The tax is based on a vehicle manufacturer’s suggested retail price for a new car. In subsequent years, the amount of the tax is based on the value of a car as set by a standard formula.

The Transportation Commission is recommending the new MVET be capped at 2 percent, with three-quarters of the fee going to the state and the rest authorized as a local option for counties and cities.

It’s estimated a 1.5 percent tax would generate more than $500 million a year. Transportation commissioners want 90 percent of the money to go toward capital improvement projects and dedicate the rest to transit agencies.

Increasing the “gross weight fee” by 15 percent on trucks would raise up to $12 million a year. The Transportation Commission is recommending this money be used to fund freight mobility projects.

Tutton, of the Washington Trucking Association, said all commercial truckers pay the gross weight fee, which is based on the weight of loaded trucks.

Industry members “always support legitimate fees and taxes” if they go toward transportation upgrades, he said. At issue is how the money in the proposed package would be spent, and that has not been determined, Tutton said.

“We will be monitoring the legislation though our lobbyist down in Olympia and reacting accordingly,” Tutton said.

Among the projects recommended by the Transportation Commission for funding by the new money are: $1.4 billion to pay for the rest of the state Route 520 improvement package; $2.5 billion for expanding Interstate 405; $1.2 billion for extending state Route 509 in South King County; $1.5 billion for expanding state Route 167 into Pierce County.

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