Feb. 16, 2005, 11:36PM
Perry receptive to tying gas tax to inflation index
Governor calls speaker's proposal an 'interesting idea'
By CLAY ROBISON
Copyright 2005 Houston Chronicle Austin Bureau
AUSTIN - Gov. Rick Perry indicated Wednesday that he is receptive to finding a back-door approach, keyed to inflation, for raising state gasoline taxes.
"There may be some type of approach that is put in place that I could support, but let's just wait and let it work its way through the (legislative) process," he said.
The idea of tying the gasoline tax to an inflation index was broached Tuesday by Speaker Tom Craddick. Perry said the proposal is "an interesting idea."
The tax, which has been set at 20 cents per gallon since 1991, will raise almost $3 billion this year, but it hasn't kept pace with the increasing costs of building and maintaining highways. Texas' gasoline tax rate is midrange among states.
Three-fourths of Texas' gasoline tax revenue is dedicated by the state constitution to highways and one-fourth to public education.
Both Perry and Craddick indicated that any increase would be limited, at least initially.
State Rep. Mike Krusee, R-Round Rock, chairman of the House Transportation Committee, said he is trying to draft legislation to tie the gasoline tax to a highway construction cost index or something similar.
Two years ago, Perry and Craddick insisted on bridging a $10 billion budgetary shortfall without raising state taxes. Now, regardless of what happens to the gasoline tax, the governor and lawmakers are trying to piece together a package of new or higher state taxes in exchange for sharp reductions in local school property taxes.
But Perry's goal is to avoid an overall net tax increase, spokesman Robert Black said.
Dick Lavine, an analyst with the Center for Public Policy Priorities, said state leaders are facing budgetary reality.
"It's no longer just a flat no-new-taxes (attitude)," he said. "It's a recognition that sometimes you have to pay to get what you want."
But Lavine, whose group lobbies for low-income people, said the gasoline tax is regressive. The increase, he said, would disproportionately hit poorer Texans harder because gasoline consumption is not a function of wealth.
"No matter how rich you are, you really don't drive that much farther than the average person," Lavine said.
An increase of only a few cents in the gasoline tax would do little to close the highway construction gap, and Perry still supports the increased use of toll roads, which has stirred controversy in parts of the state.
Transportation Commission Chairman Ric Williamson, a Perry appointee, has been discounting the possibility of higher gasoline taxes as he promotes toll roads.
Perry said he didn't want to raise "x amount of money to put on top of the gasoline tax at this particular point in time."
"But that's not what the speaker's talking about here. He's talking about a long-range plan. ... So, let's just see how this works itself out," he added.
Craddick said the state already used inflationary indexes for other purposes.
"I think it's just something we've got to look at if we're going to fund the needs of Texas, and I think transportation is a major need of the state."
Perry receptive to tying gas tax to inflation index
Governor calls speaker's proposal an 'interesting idea'
By CLAY ROBISON
Copyright 2005 Houston Chronicle Austin Bureau
AUSTIN - Gov. Rick Perry indicated Wednesday that he is receptive to finding a back-door approach, keyed to inflation, for raising state gasoline taxes.
"There may be some type of approach that is put in place that I could support, but let's just wait and let it work its way through the (legislative) process," he said.
The idea of tying the gasoline tax to an inflation index was broached Tuesday by Speaker Tom Craddick. Perry said the proposal is "an interesting idea."
The tax, which has been set at 20 cents per gallon since 1991, will raise almost $3 billion this year, but it hasn't kept pace with the increasing costs of building and maintaining highways. Texas' gasoline tax rate is midrange among states.
Three-fourths of Texas' gasoline tax revenue is dedicated by the state constitution to highways and one-fourth to public education.
Both Perry and Craddick indicated that any increase would be limited, at least initially.
State Rep. Mike Krusee, R-Round Rock, chairman of the House Transportation Committee, said he is trying to draft legislation to tie the gasoline tax to a highway construction cost index or something similar.
Two years ago, Perry and Craddick insisted on bridging a $10 billion budgetary shortfall without raising state taxes. Now, regardless of what happens to the gasoline tax, the governor and lawmakers are trying to piece together a package of new or higher state taxes in exchange for sharp reductions in local school property taxes.
But Perry's goal is to avoid an overall net tax increase, spokesman Robert Black said.
Dick Lavine, an analyst with the Center for Public Policy Priorities, said state leaders are facing budgetary reality.
"It's no longer just a flat no-new-taxes (attitude)," he said. "It's a recognition that sometimes you have to pay to get what you want."
But Lavine, whose group lobbies for low-income people, said the gasoline tax is regressive. The increase, he said, would disproportionately hit poorer Texans harder because gasoline consumption is not a function of wealth.
"No matter how rich you are, you really don't drive that much farther than the average person," Lavine said.
An increase of only a few cents in the gasoline tax would do little to close the highway construction gap, and Perry still supports the increased use of toll roads, which has stirred controversy in parts of the state.
Transportation Commission Chairman Ric Williamson, a Perry appointee, has been discounting the possibility of higher gasoline taxes as he promotes toll roads.
Perry said he didn't want to raise "x amount of money to put on top of the gasoline tax at this particular point in time."
"But that's not what the speaker's talking about here. He's talking about a long-range plan. ... So, let's just see how this works itself out," he added.
Craddick said the state already used inflationary indexes for other purposes.
"I think it's just something we've got to look at if we're going to fund the needs of Texas, and I think transportation is a major need of the state."
