What’s happening: Policymakers in 11 states are considering bids to temporarily suspend or repeal transportation-related taxes and fees. Legislation has been introduced in 10 states – California, Idaho, Illinois, Maryland, Missouri, Ohio, Rhode Island, Virginia, Washington, and West Virginia – while governors in three others – Colorado, Florida, Pennsylvania – have pitched similar ideas.
Why it matters: State and local lawmakers cite four key factors driving these proposals, including rising fuel prices, excess revenues from federal COVID relief funds, larger-than-expected budget surpluses and additional funding from the Infrastructure Investment and Jobs Act. However, these proposals, if passed, could put highway investment at risk if state revenues are diverted from transportation programs.
Efforts to eliminate or suspend state motor fuels taxes often encounter steep obstacles to advance. Additionally, a study by ARTBA’s economics team found that only one-third of gas and diesel tax increases or decreases are passed on to consumers.
What’s next: ARTBA-TIAC will monitor and provide updates on these and any forthcoming proposals as states begin to convene their respective legislative sessions.
More information:
ARTBA-TIACs state legislative dashboard to monitor ongoing developments.
A detailed state-by-state breakdown of transportation funding economic benefits.