California Legislature hikes gas tax for infrastructure plan

California Legislature hikes gas tax for infrastructure plan
© Getty

California legislators approved a $52 billion infrastructure plan on Thursday meant to address a massive backlog of repair and maintenance projects, while creating thousands of new jobs.

State drivers will shoulder much of the financial burden for the new plan: The bill raises gas taxes by 12 cents a gallon and creates a new annual fee for vehicle owners.

Supporters of the bill said the average driver would pay about $10 more per month in fuel taxes, and most drivers will pay between $25 and $50 annually to license vehicles valued under $25,000.

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The measure is a significant win for Gov. Jerry Brown (D), who campaigned hard to win votes for the first gas tax increase in the last 23 years.

“Fixing our roads is basic,” Brown said at a rally Wednesday on the steps of the capitol in Sacramento. “If you don’t do it now it gets more expensive next year and the year after.”

Most of the money, about $33.7 billion, will pay for a backlog of infrastructure repair projects that has grown to $130 billion. The American Society of Civil Engineers estimates that half the state’s roads are in poor conditions.

Two thirds of legislators, exactly the number needed to raise taxes under California rules, backed the measure. One member of the Assembly returned from the emergency room, where she had been taken after feeling ill, in time to vote.

Only one Republican, state Sen. Anthony Cannella, backed the deal, which provides nearly half a billion in funding for two projects in his Modesto-area districts. Cannella said he and Brown had hammered out a deal at the governor’s mansion just before the vote took place. 

Several other swing-district Democrats received carve-outs that will pay for projects in their districts. One Democrat in the Senate and one Assembly Democrat voted against the bill.

Republicans objected to a tax increase they said would exacerbate economic problems for families struggling to make ends meet.

“This institution is sick,” Assemblyman James Gallagher (R) said, according to the Sacramento Bee. “You have to be drunk to support this measure tonight, drunk on the power that is ruining this institution, and that is making it harder and harder to live in this state.”

As infrastructure maintenance costs pile up, several other states are debating whether to raise gas taxes to deal with local projects. Louisiana legislators will debate a proposal to raise gas taxes in a special session beginning next week. The Republican-led Montana state House voted to raise taxes by eight cents per gallon in March, and the state Senate will take up the proposal this month.

Tennessee Gov. Bill Haslam (R) has proposed raising gas taxes by six cents per gallon, offset by other tax cuts, though legislative Republicans are skeptical of the plan. And South Carolina’s state House approved a two-cent per gallon gas tax hike, which Gov. Henry McMaster (R) has threatened to veto.

At the federal level, proposals to raise the gas tax appear doomed, even as President Trump contemplates a trillion-dollar infrastructure plan. Few details of that plan have been made public, though much of the money would likely come from public-private partnerships.