MADISON, Wis. -- The battle over Wisconsin's annual gasoline tax increase could come to a head Tuesday with a likely vote in the Senate on State Senator Tom Reynolds' (R) proposal to eliminate the automatic indexing for inflation in 2007, reported the Associated Press.
It is a confluence of several forces: a popular push to cut the high price of gasoline, the political force of the state's road builders and the desire of some lawmakers to protect road projects they consider essential to their districts. This particular vote puts a lot of legislators [image-nocss] in an uncomfortable place they don't want to be, said Reynolds.
Several lawmakers have pushed for years to eliminate the automatic increase. But as prices climbed above $3 a gallon this fall, the effort found new traction.
Reynolds' proposal would eliminate indexing, beginning with the increase slated for April 1, 2007. Now 29.9 cents a gallonone of the highest gasoline taxes in the nationthe tax is scheduled to increase twice by then, jumping to 31.3 cents a gallon. The bill must pass both houses of the state legislature before it could go to Governor Jim Doyle (D) for his review. If signed into law, the change would cut $5.1 million out of the almost $3.2 billion transportation fund, made up mostly of gasoline taxes and license and registration fees, in the current two-year budget that ends June 30, 2007. The change would mean a loss of $75.1 million in the next two-year budgetsavings that could be passed onto motorists.
Lining up against the change have been interest groups whose livelihoods are tied to the transportation fund, most notably road builders.
The industry and its affiliated unions are among the biggest contributors in Wisconsin politics. Patrick Stevens, executive director of the Wisconsin Transportation Builders Association, dismissed the notion that the industry's political prowess keeps indexing alive. He pointed out that other taxes increase as inflation drives up prices and incomes. Indexing is the state's way to ensure the gasoline tax keeps pace. He said the increase of 0.8 cents a gallon that went into effect this April amounts to $4 a year for the average citizen. For the price of a Happy Meal, you're able to maintain a system that is in essence the economic lifeblood for the state of Wisconsin, Stevens said.
On top of the gasoline tax, motorists pay 3 cents a gallon to clean up old gas stations. Lawmakers and the governor agreed to cut a penny from that portion of the tax starting next year. It will be a rare decrease in gasoline taxes, but much of that would be wiped out by the expected increase for inflation April 1. That increase is expected to cost consumers an additional $26.5 million over the course of the year.
U.S. Rep. Mark Green and Milwaukee County Executive Scott Walkerboth seeking the Republican nomination to take on Doyle next yearpassed on opportunities to end indexing while in the legislature in the 1990s. In 1995, both voted for the state budget, which increased the tax by 1 cent and changed the formula for figuring future increases, leading to larger hikes each year. They also voted to reject an amendment to suspend automatic increases and cut the tax by 1.6 cents if the state received $70 million more in federal highway funds than anticipated.
Now, they both advocate an end to indexing. Walker would replace the lost money by taking part of the sales tax from vehicle purchasesmoney that now pays for programs ranging from schools to medical programsand dedicating it to the transportation fund. Green wants to eliminate the tax that goes to the cleanup fund. Both said the climate in Wisconsin was different then, and additional gasoline taxation was needed to fund important road projects.
Doyle spokesperson Melanie Fonder said the Democrat would consider anything lawmakers send to his desk on the gasoline tax as long as it maintains funding for good, safe roads.
The fate of Reynolds' proposal is uncertain; Senate Majority Leader Dale Schultz (R) opposes the bill. Assembly Speaker John Gard (R) said he would only allow a vote in the assembly if lawmakers come up with another way to put money into the transportation fund. Reynolds has a separate proposal to address that, but it has not been scheduled for a vote. Gard said road development is key to the state's economy, and he fears if the fund is cut, rural areas may lose out on state highway projects. Northeast Wisconsin is not going to take it in the shorts on myMembers help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.