At the end of February, Representative Dan Douglas (R-Bentonville) filed two House bills concerning state highway maintenance and construction. The Arkansas Highway Maintenance and Construction Act of 2017 would authorize the State Highway Commission to issue general obligation bonds for roads for twenty years.
Initially, the bill established parameters for a special election to be called by the governor so that the Arkansas constitutional requirements could be met for voter approval. Special elections in this state are notorious for low voter turnout and virtually assure that a government ballot issue, i.e. bonds, taxes, etc. are passed.
At the urging of Governor Hutchinson and to improve the likelihood of the bill getting out of the House Transportation Committee, Douglas amended his bill to allow the highway ballot issue to appear on the 2018 general election ballot. The ballot title will be “Issuance of 2017 Arkansas Highway Maintenance and Construction Bonds and pledge of the full faith and credit of the State of Arkansas.”
The second bill filed by Douglas would levy a 6.5% wholesale tax on gasoline and diesel, effective only if the highway ballot issue passed. Neither the ballot title nor the description that would appear on the 2018 general election ballot say anything about a tax. Most people are FOR better highways. This is a pure political sleight of hand.
Words do mean something. Sleight means “deceitful craftiness; stratagem”. The word stratagem is more useful in this case. Stratagem means “a cleverly contrived trick or scheme to gain an end”.
The current motor fuels tax in Arkansas is $.40/gallon. The federal portion of this tax is $.185 and the state’s portion is $.215. The current wholesale price on gasoline is $1.57/gallon. That’s an additional $.102/gallon the pump. That’s a whopping 50% tax increase to the existing state tax.
Let’s say you own a compact car that holds 12 gallons. Every time you fill the tank, you’ll pay an additional $1.24. Most households have two cars, so that would be $2.48/household. Most cars are usually gassed up twice a week. Now, you’re at $4.96/week. There are 52 weeks in a year, so you’ll end up paying $257.92 more in taxes. That will pretty much wipe out the tax cuts passed by the state legislature earlier in the session for those making less than $21,000/year and for veteran’s benefits.
In the legislative session in 2015, the General Assembly passed a half cent tax that would result in $750 million over 10 years for state highways. We’re half way through this period and yet the powerful highway lobby wants more of your hard-earned dollars.
“The governor said one of the ingredients in fostering economic development is the state’s highway plans.” (“Governor favors road-bond plan”, Arkansas Democrat Gazette, 03/11/2017) So, this is really an economic development issue? Arkansas has the highest taxes than any of the bordering states. Arkansas’s high taxes makes the state less competitive.
Road construction and maintenance is a government function. There are ways to fund Arkansas highways without raising more taxes. Roads need to be a priority in the budget. Sales tax on tires and automotive sales should be diverted to fund roads. The legislature has used $32 million of the highway funds for non-highway purposes. The Constitutional Officers Fund is funded with 3.1% of highway funds. Another 1.8% of highway funds goes to programs like “Don’t Drive Drunk”. Use Government Improvement Funds for roads. These are just a few examples.
In December 2014, Arkansas Americans for Prosperity, a conservative think tank, polled Arkansas voters specifically on the $.10 higher tax on motor fuels. Eighty percent of Republicans are opposed, 70% Independents are opposed and 51% Democrats oppose the higher tax.
The bond bill made it out of the House Transportation Committee, but last Tuesday, March 14th, it was defeated in the House. Fortunately, there were more Representatives who voted against it or who didn’t vote than those who voted for it. Representatives Payton and Miller voted against it. Thank you.
(Jacque Martin contributes ‘Just to the Right’ each month for The Sun Times.)