Haslam opens door to delaying gas tax
MURFREESBORO, Tenn. — Republican Gov. Bill Haslam is opening the door to putting off a gas tax increase in an election year, but warns that officials need to stop “kidding ourselves” about Tennessee’s growing list of unfunded road projects.
Haslam stressed to reporters after an economic development announcement last week that he has yet to make any specific recommendations about how to begin tackling the $6 billion backlog.
“I mean, nobody wants to have a gas tax,” Haslam said. “But what I encourage folks is: Let’s look and see what the proposal would be and the road projects that would be impacted by doing something or not doing something.”
But with all 99 House seats and 16 of 33 senators up for election in 2016, the governor acknowledged that political considerations could make it difficult to pass the first gas tax increase in more than 25 years.
“If they want to say, hey, it’s an election year, let’s put it off, we can do that,” Haslam said. “But everybody just needs to remember we have a $6 billion backlog of projects, and that’s just putting things further back.”
The list of prominent Republican opponents of raising the gas tax next year includes House Speaker Beth Harwell of Nashville, Senate Majority Leader Mark Norris of Collierville, Senate Transportation Chairman Jim Tracy of Shelbyville and House Majority Leader Gerald McCormick of Chattanooga.
Tracy told The Associated Press earlier this month that there isn’t enough time to put together a comprehensive road funding proposal for the upcoming legislative session in January.
“I don’t think it’s doable,” Tracy said in a phone interview. “Because we’ve got a lot of work to do to put it together.”
Nevertheless, Haslam argues that many lawmakers are willing to give the issue serious consideration in the legislative session because they recognize “the problem is real and it doesn’t go away.”
The governor wouldn’t rule out taking an incremental approach next year, while coming back with a more comprehensive proposal in 2017. But Haslam noted that there are some projects on the books that under the current funding mechanism are approved but won’t get underway until 2035.
“We can’t just keep kidding ourselves saying, well that project’s been approved, it’s going to happen when there’s no funding for it,” he said.
Haslam said he’s willing to discuss proposals to use surplus tax collections to restore about $280 million in gas tax money that was rerouted for general fund spending purposes during the terms of former Govs. Phil Bredesen and Don Sundquist. But he noted that would be one-time money that wouldn’t go very far toward lessening the backlog of projects around the state.
Each penny of the state’s 21.4cent tax on each gallon of gas is worth about $31 million in annual revenue. The tax on gas was last raised by 4 cents in 1989.