MY LAST NERVE: So Many Reasons for a Gas Tax Hike – and All Wrong

February 14, 2014

Inside Insight

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roadsIt’s a sad fact that South Carolina has the fourth largest state highway system in the nation. The state Department of Transportation (DOT) is responsible for 63 percent of all state roads; the national average for roads controlled by state transportation departments is 19 percent. 12.3 percent of our states bridges are considered structurally deficient, and 9.1 percent are considered functionally obsolete.

One would think, therefore, that our lawmakers and governor would prioritize infrastructure repair and maintenance. But one would be wrong. Last year our elected officials approved a $50 million transfer from the agency that is supposed to maintain our infrastructure system to another agency – the State Transportation Infrastructure Bank (STIB). This latter agency exists primarily to fund new expansionary construction projects rather than provide maintenance of the state’s existing roads, and has only funded projects in 11 of the state’s 46 counties.

Many of our lawmakers and other elected officials are now trying to convince us that the state is cash-strapped and unable to fix our infrastructure without new revenue from a gas tax increase. Their reasoning seems to have less to do with infrastructure repair than, well, raising taxes: it’s easier for them to come up with an altogether revenue stream (a new tax or fee hike) than to find money somewhere else in the state’s $23 billion budget.

At a recent meeting of the Spartanburg County legislative delegation, Rep. Doug Brannon suggested that the gas tax be raised to keep people from traveling into the state to fill up their tanks for cheaper than they would in North Carolina.

Using Rep. Brannon’s (R- Spartanburg) logic, higher gas taxes would keep people from crossing state lines to spend their money at our South Carolina businesses, and South Carolinians would be the ones left paying higher taxes on their gas.

But wait. Doesn’t our state government spend millions every year to attract people to our state? Don’t we have at least one state agency whose job it is to market the state to tourists in hopes that they’ll come to South Carolina and spend their money? Of course we do. Either our elected officials want people to spend their money in our state or they don’t.

Other elected officials have suggested that we need to raise the gas tax because it’s the fourth lowest gas tax in the nation. So, raise taxes because they’re not high enough already?

Sen. Ray Cleary (R- Georgetown), sponsor of a proposal that would raise the gas tax two cents every year until it reaches thirty-six cents per gallon, stated last week on a web broadcast that, in his view, taxpayers understand that if they want better roads they have to pay for them.

True enough. The problem is that South Carolina taxpayers are already paying for better roads – they’re just not getting what they’re paying for. In 2013, the DOT’s budget was $1.4 billion, or roughly 6 percent of the year’s entire state budget. From fiscal year 2009-10 to 2012-13 – despite the economic recession – the agency’s budget grew by $355 million. Yet there are few improvements in our infrastructure system to show for it.

Sen. Kevin Bryant (R- Anderson) said (in that same broadcast) “nobody would disagree that road maintenance is a core function of government, but we’ve got so many things that are not core functions of government that the public doesn’t realize. And then we’re going to come and say, ‘Hey we need to fix your potholes. I’m going to raise your gas fees,’ and I just think it’s a bait-and-switch to the taxpayer.”

And it is. South Carolina elected officials can do more to prioritize funding for our infrastructure than they are currently. There is plenty of spending – taxpayer-funded advertising, corporate welfare, money blown on programs for which there is imperial data that they’re accomplishing their aims – that can be cut in order to generate the additional revenue needed to repair our infrastructure system. Further, the DOT should stop chasing federal funds. The South Carolina Policy Council recently reported that the state was apportioned $651 million from the Federal Highway Administration in 2011, but that those dollars can only be used on about half of the state’s roads, and often help promote new expansionary projects that generate more miles of road for the DOT to maintain. Further, the Department must divert funding from maintenance in order to meet the match required to receive dollars from the Federal-Aid Highway Program.

The gas tax and other proposals for additional funding for our state’s infrastructure system will be debated this year. Pay attention to these debates, and notice what your lawmakers prioritize over core state needs.

Murguia is Director of Research for the South Carolina Policy Council, the parent organization of The Nerve. She can be reached at jamie@thenerve.org or (803)779-5022, ext. 105. Follow her on Twitter at @JamieMurguia.