The Governor of the US State of Pennsylvania, Tom Wolf, has announced on his website that the state fuel taxes ("gas tax") are unreliable and will have to be phased out. He is understood to be the first Governor of a US state to say this and is possibly the first jurisdiction in the world to have done so.
The key part of the statement reads as follows:
“Our economy, our communities, and our future rely on a strong transportation system that supports our safety and growth. We have more than $9 billion in annual unmet needs across our state-maintained transportation system alone. At the same time, Pennsylvania is relying too much on outdated, unreliable funding methods, and the federal government hasn’t taken meaningful action in decades,” Gov. Wolf said. “Phasing out the burdensome gas tax, coupled with seeking long-term reliable funding solutions that will keep pace with our infrastructure needs, deserves a close examination. Forming this bipartisan commission will bring multiple, bipartisan voices to the table to ensure that we can examine reliable, sustainable revenue solutions to address both near-term and long-term funding needs.”
In other words, there is insufficient revenue now from the gas tax to meet the state's demands, with the US$9b shortfall estimated to rise to US$14.5b by 2030. He puts the unreliability of the gas tax down to the rapidly increasing fuel efficiency of vehicles and the rise of new motive power technologies (electric and hybrids) that render the gas tax increasingly unreliable.
It is of course also increasingly unfair. It is only those who can afford to buy a relatively new vehicle who get the benefits of new vehicle technologies, so over time it means those who don't have the financial means to buy such vehicles that would increasingly pay a higher proportion of the gas tax. This argument has been critical to the success of states such as Oregon and Utah in starting a transition towards distance based road user charging.
The Governor has announced establishment of a "Transportation Revenue Options Commission (PDF for the executive order), to investigate how to progress away from the gas tax. It's main responsibilities are to:
- Study and prepare a comprehensive list of potential revenue sources available for current and future funding of transportation in the Commonwealth for all modes of transportation. The funding sources must be reliable, dedicated, inflation sensitive, and adaptive to changing environmental factors; and
- Prepare a comprehensive, strategic Commonwealth transportation funding proposal.
- Tolls on major highways and crossings;
- Full network distance (and weight) based road user charging;
- Congestion pricing on congested corridors or at major centres;
- Motor vehicle registration/licensing fees;
- Taxes on energy;
- Taxes on land related to it benefiting from transport infrastructure;
- Other direct user charges;
- Non-transport related taxes (sales taxes, income taxes).
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