SADOW: Here’s Why Jack McFarland Needs To Dump His Gas Tax Hike Bill

I’ll take up the offer made by Republican state Rep. Jack McFarland, and show him why he needs to abandon his sponsorship of a bill to raise the gas tax.

McFarland recently announced he would front this effort, at this point backed by the Democrat Gov. John Bel Edwards Administration and special interests associated with those who would benefit monetarily from motorists paying more at the pump, construction contractors. He has presented only nebulous details to date, stating that he wishes to outline broad parameters to generate discussion before introducing the final product for the 2021 Regular Session of the Legislature.

But there is a draft of the bill circulating, and we have some idea of what it would do.

Basically, as currently envisioned, the bill would increase the gas tax from the 20 cents a gallon the state currently now to 30 cents in its first year followed by two cents increases every other year to account for inflation until 42 cents are reached in 2033. It also would cap current Department of Transportation and Development spending and divert 4 cents of the existing 16-cent general tax along with the new tax dollars into a sub-fund dedicated by voters solely for construction and preservation of roads and bridges. Additionally, it would charge a new $400 annual fee at registration for electric vehicles while hybrid vehicles would pay $200.

The last new surcharges work, as a reflection of the reality that such vehicles are expected to increase their presence on the road. Nothing else does, because McFarland’s approach makes the mistake of assuming that instead of simply taxing drivers more, some current spending couldn’t be steered towards more concrete pouring for state roads.

State taxpayers at present foot too much of bills that should go to local governments and users. For example, constitutionally a sixteenth of the retail fuel tax must go for distribution to parishes, but in recent years parishes have received appropriations half again over that. And ports need not receive any state money under the Constitution.

Plus, the state every year estimates the constitutional dedication of aviation fuel taxes to airport capital spending, since that fuel is exempt under sales taxation but doesn’t have a statutory excise tax levied on it. Running recently just under $30 million annually, that figure may overestimate the actual collectible amount. And, muddying the waters is a series of five decisions this summer by the Louisiana Board of Tax Assessment that appears to open the door to sales taxation of aviation fuel, which if transpires would free all this money currently allocated.

These excess funds could go to increased roads construction, or used in other efficient ways. For example, the state has a Motorist Assistance Patrol Program for metropolitan areas, four-fifths of $5 million annually paid for by the federal government. Parish transportation funding could go to paying the state’s million a year, deducted from the allocation to the parishes benefiting.


Making local governments pay more of their own way for services that benefit only them can occur in other fashions. Besides, for example, cutting out excess subsidies to airports and seaports that the local government entities that run these can recapture through increasing user fees, the state could stop funding the state’s 11 metropolitan planning organizations and ask local governments involved to come up with the one-fifth match needed to draw the other four-fifths from the federal government.

Then there’s the drain of the 16 TIMED projects, now into its third decade that took twice as long to complete and more than that in costs, which gulps up all four cents of the dedicated gas tax and over half of one of the other 16 cents. A few of those projects are amenable to user fees, which could offset at least some of the overhang into the regular tax (although this is projected to rise to as much as nearly 2.5 cents right before bond payoff in the early 2040s).

All in all, making these kinds of changes (plus incorporating the recent BTA decisions, and stopping subsidies to the New Orleans-area Regional Transit Authority and other urban transit systems and to tolls on Highway 1) add up to $123 million extra annually. This could grow further if the state would stop another kind of roads subsidization – maintenance of what should be local byways. Even though Louisiana by land area is only the 33rd largest state, 25th by population, and 23rd by population density, it’s 11th in terms of public road length in miles by state highway agency ownership. It needs to surrender thousands of miles of roads to parish governments, and even give them the ability to add fuel excise taxes of their own to maintain them, and this could double the above figure available for state road construction.

These are the necessary steps to be taken prior to taking more money out of motorists’ pockets at the state level. Local governments and users of that infrastructure need to take more responsibility for roads and ports and largely benefit them. Until making these changes, the idea championed by McFarland and those like it are nonstarters.



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