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Road taxes are rising, even in tax-averse states

By DAVID A. LIEB

JEFFERSON CITY, Mo. (AP) - For nearly a century, Missouri has taxed drivers to pay for its roads. That's always provided enough - until now. On Tuesday, voters will decide on a historic change that would tax virtually everything they buy in order to yield more money for roads and bridges.

With Congress stymied over long-term highway funding, many states are taking it upon themselves to tackle the politically uncomfortable task of raising revenue for their aging transportation systems.

In the past year and a half, one-fourth of the states have hiked taxes, fees or fines, and at least a dozen others are studying options, according to an Associated Press review. The push comes as the traditional revenue sources - federal and state fuel taxes - have deteriorated because of more fuel-efficient vehicles, more people driving less, and stagnant tax rates.

Support for the hikes has come from Democrats and Republicans alike, even in tax-averse states such as Missouri, where the Legislature has been cutting income taxes.

"Tax increases are very, very hard to pass," said Missouri Sen. Mike Kehoe, a Republican who supports the measure on Tuesday's ballot for a three-quarters cent sales tax increase. "But I think that people do look at infrastructure differently ... as an investment."

Congress agreed Thursday to a 10-month funding patch for the federal Highway Trust Fund, which was running out of money to cover all of its commitments to the states. But a long-term plan remains unresolved, and the stalemate already has caused delays for some projects such as highway improvements in Tennessee and bridge replacements in Arkansas. Federal money accounts for more than a quarter of states' total spending on highways and transit infrastructure, according to the Pew Charitable Trusts.

"I just don't think we can count on any more federal dollars coming in than what we're currently getting, and we should assume that money is going to drop," said Rep. Dave Hinson, a Republican who sponsored Missouri's proposed transportation sales tax.

States are already facing shortfalls in their own transportation revenue.

The U.S. Department of Transportation estimates that governments would need to spend as much as 50 percent more to pay for all of the work needed on roads, bridges and mass transit.

In Michigan, two-thirds of the roads are projected to be in poor condition by 2020, yet a proposed tax hike has stalled.

Missouri's highway budget is projected to plummet from a recent high of $1.3 billion annually to $325 million by 2017. There is no Plan B to replace that money if voters don't approve a sales tax that is projected to raise at least $540 million annually.

Construction contractors, labor unions, engineering firms and others have poured more than $4 million into the Missouri sales tax campaign and have outspent opponents by a more than 100-to-1 ratio. The advertising blitz is a necessity because Missouri voters have a history of rejecting tax increases.

Opposition is coming both from staunch conservatives, who oppose most tax hikes, and strident liberals, who fear the sales tax would hit the poorest the hardest while demanding nothing from the heaviest highway users. The sales tax hike wouldn't apply to tractor-trailer rigs, which were exempted under a 2012 law.

"The absurdity of it is if you go out and buy your child a toy truck, and then you go out and buy an 18-wheeler, you're going to pay more road tax on the toy truck than you are for the 18-wheeler," said Thomas R. Shrout Jr., a St. Louis consultant who is treasurer of the opposition group.

Transportation tax increases already have run into problems in some states. Last year, voters in nine of Georgia's 12 transportation districts defeated a sales tax hike, and Seattle area voters rejected a transportation sales tax and vehicle fee increase in April.

Other states have pushed ahead with increases without putting them to a vote of the people.

New Hampshire Gov. Maggie Hassan, a Democrat, signed a 4-cent-a-gallon fuel tax increase that took effect in July, the first such increase since 1991. Republican Wyoming Gov. Matt Mead signed legislation last year raising the fuel tax to 24 cents a gallon from the 14-cent rate.

Significant transportation funding measures were enacted recently in Maryland, Massachusetts, Pennsylvania and Virginia. Texas voters will decide in November whether to divert about $1 billion annually from the state's Rainy Day Fund to transportation.

In many states, the funding plans have taken several years of bipartisan coalition-building, said Tony Dorsey, spokesman for the American Association of State Highway and Transportation Officials.

"States are realizing that they have to fund transportation projects in big ways - you know, our system is aging," Dorsey said.

Join the discussion

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dhsdome August 04 2014 at 1:08 PM

Between federal, state, county, city and sales taxes government (all levels) has plenty of money to fix roads and bridges. The problem is government waste, corruption and giveaway programs.

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1 reply
eltrip dhsdome August 04 2014 at 1:10 PM

You know this for a fact? Those are all problems in any construction project.

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2 replies
plewdawg eltrip August 05 2014 at 6:28 AM

It is and check your pants for a rip....your ass is showing.

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jetburn8 eltrip August 05 2014 at 7:08 AM

You have to have some kind of hard proof? You can't look around, use your head and SEE IT???

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dan_crabtree August 04 2014 at 12:28 PM

seven out of ten people now working two jobs to make ends meet...they cannot afford anymore democrat taxes..

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6 replies
John August 04 2014 at 1:08 PM

Knowing the way politicians are these tax dollars will never be spent on the roads but funneled into the "general" funds and used for pay raises and pet projects. Plus once a tax is in place they are never removed.

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prnyl August 04 2014 at 3:34 PM

Tax and tax and tax until you can tax no more- welcome to big government America- LIke Thomas Jefferson said" Most bad government comes from too much government" which drives these lifetime politicians to put their personal interests ahead of the common man who foots the bill thru their taxes. Infrastructure is the current bull**it excuse for all of government- no accountability!!

VOTE THEM ALL OUT- NO INCUMBENTS!!

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3 replies
wbearl August 04 2014 at 2:04 PM

I have no problem with fixing our roads and bridges. I have no problem with them raising the taxes if necessary. However before they raise taxes, let's have an accounting of our gas tax and license plate fees. Most states have about 10 cents on the gallon tax, some much more, now figure how much gas your station pumps, multiply that by all the gas stations in your town and then multiple that by .10, and that's just your town, not your state. Can't help but wonder where that money all goes.

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2 replies
nyhuguenot wbearl August 05 2014 at 1:15 AM

Not all the road taxes goes to roads. Much of it goes to train systems and airports.

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1 reply
wbearl nyhuguenot August 05 2014 at 8:52 AM

First off there are also taxes on Air Lines, usage taxes, terminal fees etc. Railroads pay huge property taxes and in many states pay a fuel tax. Now if you are talking about Government run mass transit, that is another thing, everyone knows that's a black hole, a bottomless money pit. Last Railroads pay their own way, it's called operating costs and it comes off the top before profits are figured. Most railroads spend about 75 cents to earn a dollar. If "A" Government wants them to do something not budgeted the Government will pay them to do so, but if it was a profitable project the railroads would have already tapped it, so like mass transit,it is usually a big dark black hole, kind of like Amtrak.

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hyyr wbearl August 05 2014 at 6:52 AM

Much of it also goes to wherever the politicians want to spend it.

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fscharer August 04 2014 at 12:07 PM

I wouldn't be adverse to having the road tax raised if it was fair across the board, the vehicles that do the most damage to the system pay the most. The biggest problem that I see is that it wouldn't happen and our elected representatives would probably find some loophole that would allow them to use the funds for some other purpose thereby not fixing the roads.

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1 reply
kabube fscharer August 05 2014 at 6:03 AM

Heavy vehicles do more damage, but if we tax them more, it will mean higher prices for the products they transport.

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1 reply
jj2301 kabube August 05 2014 at 6:07 PM

That's fine. Then, the people generating the need to operate large trucks are then paying the true cost of having whatever product they desire brought to them.

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backpkr580 August 05 2014 at 7:48 AM

put the people getting wealfare that are not working but sitting on there butts and you cut the labor costs .theyve already been paid .

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bbnpl4545 August 04 2014 at 2:06 PM

There are ppl, getting paid to sit all day and think of ways to take your money. And ppl. agree with it. No wonder why they keep doing it.

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auctionsurplus August 05 2014 at 7:37 AM

STOP raising taxes!! Just STOP much of the humanitarian aid to other countries and stop more of the welfare fraud. STOP paying for illegals. Get THIS country in order before helping to rebuild others. We'd have super roads and bridges and our infrastructure would be in great shape.

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1 reply
Russell auctionsurplus August 05 2014 at 10:22 AM

You are right on the MONEY.

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Tom Harrell August 04 2014 at 1:59 PM

The STATES taking over and getting the Job DONE.
GREAT IDEA !
Do the SAME with Education and everything Else (except the Military) and then stop paying the FED taxes and divert all the Fed Funds to the States.
Imagine closing down all those Feferal Agencies and Bureaus.
The Government would be Debt FREE in a matter of MONTHS.

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