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Lawmakers advance two bills to raise highway funds, including higher gas tax

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Scott Sommerdorf | Tribune file photo At least two bills dealing with increased taxes to pay for Utah roads have been introduced in the Legislature. One would actually cut gas taxes and increase the general sales tax. The other would tie the fuel tax to prices.

By Lee Davidson

The Salt Lake Tribune

First published Mar 04 2014 10:03AM
Updated Mar 4, 2014 08:58PM

Two initiatives to raise more money for highways advanced Tuesday, including tweaking the gasoline tax so it would rise along with prices at the pump and allowing the Utah Department of Transportation to sell limited ads at rest stops and on its online traffic app.

The House Transportation Committee passed both bills unanimously and sent them to the full House.

SB60, by Sen. John Valentine, R-Orem, would change how Utah’s gasoline tax is calculated, so it would rise if gasoline prices increase in the future. But it has a built-in floor so they cannot fall below current levels.

The current gasoline tax is 24.5 cents per gallon and has not gone up since 1997.

Valentine’s measure would keep 14 cents a gallon as a base. The rest would be determined by multiplying 3.69 percent and the previous year’s average price per gallon of gasoline before state and federal taxes are added.

Valentine said the calculations are designed to keep taxes flat for the first year, but let them rise thereafter as gasoline prices increase. He said he is negotiating changes with oil companies and may tweak the bill so that prices are adjusted only every three years instead of annually.

In the bill’s current form, Valentine said that for every $1 bump in the price of gasoline, a driver who averages 12,000 miles a year would pay an extra $18 in tax annually.

A long parade of local officials, state highway officials and businesses supported the move, saying Utah and local governments have been falling behind in their ability to maintain roads because the gas tax has not been raised in 17 years, resulting in losses from inflation. Motorists also are purchasing less gas because cars are more fuel-efficient, and there are more hybrids and alternative-fuel vehicles.

Utah has projected an $11 billion shortfall for high-priority transportation projects through 2040 unless it reforms gasoline and other transportation taxes. "This is a first step," said Rep. Dan McCay, R-Riverton.

The committee also unanimously passed HB152, by Rep. John Knotwell, R-Herriman. It would allow UDOT to sell banner ads for its online traffic application and sell limited ads at rest stops.

"This is an opportunity to stretch finite dollars we have in transportation for maintenance," Knotwell said. "It will not raise taxes" but help fund roads.

The bill would ban political ads and any activity that is illegal for minors, such as use of tobacco and alcohol or gambling.

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