Two Colorado lawmakers hope to ask voters to nix the state’s gas tax in order to bump up sales and use taxes in an attempt to generate sustainable revenue to fund transportation.
Senate Concurrent Resolution 3, proposed by Sen. Kevin Priola, R-Henderson, and Rep. Matt Gray, D-Broomfield, would ask voters permission to amend the state’s constitution to replace “state excise taxes on gasoline and other liquid motor fuel with an additional state sales and use tax.”
The new revenue would exclusively fund road construction and maintenance.
The Taxpayer’s Bill of Rights amendment requires voter approval of all tax hikes, so voters would have to approve the sales and use tax increase outlined by the legislators.
Critics have said TABOR is a barrier to raising funding for transportation and education, among other initiatives, but some doubt the viability of asking voters to raise taxes, given their history of voting against other tax hike measures.
“It’s probably doomed,” said Kelly Sloan, an energy and environment policy fellow at the Centennial Institute. “Colorado voters have a history of not voting for tax increases – that’s essentially what this is. I get the rationale that over time as vehicles become more fuel efficient and perhaps you see more electric vehicles on the road, that gas tax as a proportion of the contribution to the overall transportation fund is going to decrease.”
The resolution is part of a larger effort by lawmakers to find new revenue streams to fund transportation, something they’ve struggled to do without raising taxes. The legislature’s proposed budget for 2019-2020 includes $300 million to fund transportation following negotiations between the two chambers.
“We have the resources to pay for transportation, the problem is we haven’t been prioritizing it,” Sloan said.
The Colorado Department of Transportation says that fuel-efficiency requirements and more fuel-alternative vehicles has contributed to a steady decline in revenues collected through the fuel tax, a trend forecasted to continue. The population increase in the state will also lead to more wear and tear on the roads, which will need more repairs, the department says.
“Since the current funding model relies on fuel consumed, these new standards and alternative fuel vehicles result in less money to fix the roads,” CDOT says on its website.
The department estimates it will have “a $25 billion funding gap over the next 25 years.”
"We need a different and sustainable revenue source," Gray told Colorado Politics. He believes the plan would be revenue positive after its first year.
Getting Republicans on board is another issue despite Priola co-sponsoring the resolution.
Colorado Politics noted that the resolution will need a two-thirds vote in each chamber to pass, so it would need "non-trivial Republican support," according to Gray.
Colorado voters in November shot down two proposals to fund transportation, one that would have increased sales taxes and one that would have used bonds.
The Colorado Municipal League said the plan isn’t a “statewide solution."
The resolution “doesn't provide any significant new revenue to assist local government's infrastructure challenges,” the group said. “This is not a comprehensive statewide solution that will improve our infrastructure and alleviate congestion on Colorado's roadways.”
The resolution will be heard in front of the Senate Transportation and Energy Committee next week.