Over the past 10 years, state transportation funds have supported an average of 48 percent of annual capital outlays for highway and bridge projects, with federal resources providing the remaining 52 percent. Since 2013, 15 states have increased taxes on motor fuel to support needed transportation investments.
Transportation Investment Advocacy Center staff have compiled in-depth reports on all of these increases, with information on why these states raised their motor fuel taxes, what they did in order to grow transportation funding, who the major players were, and the recurring themes seen in these successful campaigns. Visit the links below to view the case studies.
WASHINGTON STATE: SENATE BILL 5987 (2015) Senate Bill 5987 was signed into law on July 15, 2015, in order to increase the state gas tax by 11.9 cents-per-gallon and increase transportation-related fees, as well as permit Sound Transit residents to vote on a plan to fund expansion of the region’s light rail system.
SOUTH DAKOTA: SENATE BILL 1 (2015) Senate Bill 1 was approved on March 30, 2015, in order to increase the state gas tax by 6 cents-per-gallon and raise various transportation-related fees.
UTAH: HOUSE BILL 362 (2015) A bill to increase the state gas tax by 5 cents-per-gallon and create a 12 percent tax on the average wholesale price of fuel, to replace the state’s flat gas tax once the price of fuel reaches $2.45 per gallon. Utah HB 362 was signed into law on March 27, 2015.
GEORGIA: HOUSE BILL 170 (2015) Legislation approved May 4, 2015, to remove the variable-rate motor fuel tax and institute a flat cents-per-gallon increase, which will be indexed, as well as raise various transportation-related fees.
IDAHO: HOUSE BILL 312 (2015) Legislation approved April 21, 2015, in order to increase the state gas tax by 7 cents-per-gallon, raise vehicle registration fees, and institute a fee on electric and hybrid cars in order to generate new funding for the state’s roads and bridges.
IOWA: SENATE FILE 257 (2015) Senate File 257 was signed into law on February 24, 2015, in order to increase the state gas tax by 10 cents-per-gallon.
NEBRASKA: LEGISLATIVE BILL 610 (2015) The Nebraska legislature voted on May 14, 2015, to override the Governor’s veto of a 6 cents-per-gallon gas tax increase. The increase will be gradually implemented over four years, starting with 1.5 cents-per-gallon on January 1, 2016. By passing this bill, Nebraska became the sixth state in 2015 to approve a gas tax increase.
NEW HAMPSHIRE: SENATE BILL 367 (2014) A 4.2 cents-per-gallon motor fuel increase was signed into law in New Hampshire on May 20, 2014, for the purpose of resurfacing and reconstruction on secondary roadways, municipal bridges, and Interstate 93.
RHODE ISLAND: HOUSE BILL 7133 (2014) A bill to increase the state gas tax by 1 cent-per-gallon (starting July 1, 2015), revisited every two years to reflect increases based on the rate of inflation; increase vehicle inspection fees from $39 to $55; and raise court fees drivers pay to dispute fines for traffic violations from $25 to $50. H 7133 (Article 21- Relating to Transportation) also transferred existing motor vehicle fees and surcharges, previously deposited into the General Fund, to the Rhode Island Highway Maintenance Account.
VIRGINIA: HOUSE BILL 2313 (2013) The Virginia state legislature produced a five-year, $3.4 billion transportation investment bill that, among other changes, replaced the state’s gas tax with a sales tax on motor fuel. The new law scrapped the existing flat gas tax, raised the sales tax, established a tax on wholesale gas and diesel, and charged registration fees for hybrid, electric and alternative-fuel vehicles.
MARYLAND: HOUSE BILL 1515 (2013) This successful legislative campaign in the Maryland state legislature resulted in the enactment of a transportation gasoline/sales tax package that has been projected to generate $830 million per year for road and public transportation improvements. This law established a new three percent sales tax on wholesale gas, which will be introduced over a three-year period. This law also automatically adjusted the flat tax on gas to account for changes in inflation.
VERMONT: HOUSE BILL 510 (2013) The Vermont legislature enacted a 2 percent sales tax on gasoline as well as a 0.8 cent decrease in the per gallon tax, and a 2 cents-per-gallon diesel tax increase —phased in over two years— that will generate $28 million per year to support road and bridge improvements.
WYOMING: HOUSE BILL 69 (2013) This successful legislative campaign with the Wyoming state legislature raised the fuel tax rate by 10 cents-per-gallon, which will generate approximately $70 million annually.
PENNSYLVANIA: HOUSE BILL 1060 (2013) The 2013 Pennsylvania state legislature produced a five-year, $2.3 billion transportation package. The law eliminated the state retail gas tax paid at the pump and removed the cap on the Oil Company Franchise Tax, which was charged at the wholesale level.
MASSACHUSETTS: 2013 This successful legislative campaign by the Massachusetts state legislature resulted in an increase of the gasoline tax in order to generate additional transportation funding. In July of 2013, Massachusetts legislators overrode a veto from Gov. Deval Patrick (D) to enact a 3 cents–per-gallon gasoline tax increase as part of an $800 million transportation bill.