ANNAPOLIS – Beginning in 2002, Maryland motorists could pay even more at the pumps if a fuel tax bill by proposed by Delegate Sheila E. Hixson, D-Montgomery, is approved by the Maryland General Assembly.
Hixson wants to fill state transportation fund coffers by increasing the state’s gasoline tax – currently 23.5 cents per gallon – after a rise in the motor fuel component of the Consumer Price Index for urban users.
The CPI, computed by the U.S. Bureau of Labor Statistics, reflects the percent change in pump prices, including taxes, sampled at gas stations nationwide.
Hixson said she introduced the bill because she’s worried the state’s Transporation Trust Fund won’t have enough money to correct Maryland’s worsening traffic problems. But budget officials say the fund is healthy and the required minimum balance of $100 million will be maintained each year through 2004.
Traffic congestion is especially bad in Hixson’s home county, where business proponents say gridlock is a formidable barrier to new commerce.
The new tax would work like this: the inflation rate will be measured each Oct. 1. If it rises, it triggers an automatic increase in the tax the following July, beginning in 2002. A decline in the inflation rate, however, will not lower the tax.
The bill’s prospects are unclear as the Legislature duels over income tax cuts in light of a nearly $1 billion budget surplus and amid calls for record- high operating and transportation budgets by the governor.
“At this point, we have the money to continue (our) transportation projects,” said Michelle Byrnie, Gov. Parris N. Glendening’s press secretary. “We are not looking at raising the gas tax.”
But Hixson is worried that near-term solutions will leave Maryland stranded long after Glendening is gone.
“We’re trying to look to the future,” she said.
Hixson said she has reason for her worries about the fund. The final report by the Governor’s Commission on Transportation Investment, a committee created by the General Assembly in 1999, found the current fuel tax, the largest source of revenue in the Transportation Trust Fund, won’t keep up with unscheduled transportation improvements and maintenance. The commission estimated the state will need an extra $27 billion over the next 20 years.
The Maryland Transportation Trust Fund forecast calls for spending roughly $1 billion a year for the next four years.
The bill is not the only attempt to bridge the gap between road proposals and Maryland’s growing traffic problems. Others include a bill introduced by Maryland House Speaker Casper R. Taylor Jr., D-Allegany, to divert a portion of sales taxes to a transit fund, and a bill submitted by Sen. Larry E. Haines, R- Carroll, that allots certain general fund surpluses to the transportation fund.
“This is more of a protection plan,” Hixson said, “so we wouldn’t have to go through a ‘gas war’ fight when the Department of Transportation needs the money.”
The impact of the tax in 2002 can’t be computed because estimates of the CPI fuel index are not available from the governor’s budget office. However, using current figures, the tax would mean an increase of about a nickel per gallon.
The average fuel price in the state is $1.30 a gallon, according to the American Automobile Association. Overall, AAA said fuel prices are up 34 percent from last January.
“We think the motorists are paying their fair share – and more,” said Lon Anderson, a AAA lobbyist. The bill also could give Virginia a bigger competitive edge in attracting new businesses, he said, since its gas tax is already a nickel less than Maryland’s. Anderson’s biggest problem with the bill is that it automatically raises the fuel tax every year, depending on the CPI. “It will allow future legislators to be able to say, ‘We didn’t raise your tax,'” Anderson said. At least one senior Republican doesn’t think Anderson needs to worry. “It’s not going to pass,” said Delegate Robert H. Kittleman, R-Howard. “There might be fee increases this year, but not tax increases.”
Hixson’s fuel tax would not effect aviation gasoline or turbine fuel.