MoDOT seeks approval of gas tax proposal

A proposal to raise the gas tax by six cents over three years is being promoted as a way to avert deep cuts to Missouri Department of Transportation funding for road construction that could eventually mean giving up federal highway dollars.

MoDOT calls it the 2+2+2 Plan. It is based on a pending bill introduced by Sen. Doug Libla, R-Poplar Bluff, and similar House bills. It would raise the gas tax two cents a year for three years. Missouri's current gas tax of 17.3 cents would go up to 23.3 by 2018.

It is seen as a possible legislative solution to a restricted budget MoDOT faces as the result of voter rejection last fall of Amendment 7, a proposal that would have a three-quarter cent sales tax on gasoline for 10 years.

"In the wake of the defeat of Amendment 7, we're seeing our funding decline," said Frank Miller, district planning manager for the Southwest District of MoDOT, at a meeting Thursday of Joplin area transportation planners and city officials. MoDOT's pared down spending plan for upcoming years is called the 325 System.

Under that plan, construction spending would be reduced from $600 million now to $325 million in 2017. By then, the agency would not have enough money to obtain federal matching funds for highway projects.

"The essence of our 325 Plan is that we will focus only on contract work on our primary system routes which include I-49, I-44 and Route 171," in the Joplin area, Miller told members of the the Joplin Area Transportation Study Organization. "What gets left out then are routes like Range Line and 32nd Street, and we won't be doing contract (construction) work on them," only routine maintenance work such as filling potholes and patching. "The department will not be doing any expansion work on highways. And the department will not be able to provide matching funds for federal highway dollars."

With that tight budget, MoDOT could not build projects such as a new interchange that is planned on Interstate 44 for the Blue Buffalo plant that recently opened in Joplin. He said MoDOT has had to suspend funding for construction for similar economic development projects and, even before the Amendment 7 defeat, had suspended its cost-share program that helped local governments pay for road and bridge work.

One reason for MoDOT's funding woes is that the state's gas tax of 17.3 cents has not kept pace with inflation, Miller said. There has not been an increase in gas tax here since 1996. In past years, soaring gas prices caused Missourians to cut back on driving, which reduced consumption and the resulting revenue from that tax. Increased vehicle fuel efficiency also is driving down the amount of gas sold.

Miller said MoDOT believes it's governing board, the Missouri Highways and Transportation Commission, may endorse the 2+2+2 Plan.

That would raise the gas tax two cents a year for three years and then make automatic increases each year based on the consumer price index.

Holly Dentner, MoDOT's customer relations director, said it is a proposal that the Missouri Highways and Transportation Commission may consider for endorsement, perhaps at its next meeting April 1.

MoDOT wants to push for immediate adoption of the gas tax law to limit the losses it will incur if the 325 System has to go into effect.

If the Legislature passes the fuel tax this session, collection of the tax would begin Jan. 1 and would begin to produce revenue that could increase subsequent MoDOT budgets.

According to MoDOT projections, the tax would provide $251 million in revenue in 2017, $84 million from the state tax and $167 million federal matching funds. In 2018, there could be $525 million raised, with $399 million of that in federal funds.

If it is not enacted, the state would give up $111 million in federal matching funds in 2017 and $119 in 2018.

Cities and counties would receive 30 percent of the revenue from the gas tax. Jasper and Newton counties and the cites in those counties would receive a total of more than $1.53 million a year if the fuel tax increase went into effect.

Libla's bill would set an automatic increase of the tax each year after the 6-cent increase, which would be based on the consumer price index.

A Senate hearing has not been held yet on the bill. It is pending in the transportation committee.

"We welcome any kind of transportation funding that is available," Dentner said.

Letter of support

JATSO agreed to draft a letter a support for a revenue proposal that would keep the federal local share available.

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