Panel Says Fuel Tax Hike Inadequate Task Force Has Dozens Of Ideas For Batt

Gov. Phil Batt’s task force of Idaho business leaders agreed Monday that the state needs more cash than a 3-cent-a-gallon increase in the fuel tax will generate to maintain Idaho’s deteriorating highway system.

“Additional revenue is needed by the Idaho Department of Transportation to maintain and improve Idaho’s roads and highways,” the Governor’s Economic Stimulus Committee said in its report. “But looking just at fuel tax is shortsighted and would not raise the amount of dollars necessary to match federal funds, especially at the 3-cent level.”

That was among dozens of recommendations the panel of more than 30 people made to Batt after more than three months of review.

“You’ve exceeded my expectations,” the governor told the committee. “There are some very good thoughts in there. We need to give them a very serious review to see if they should be our policy.”

But the governor was blunter on some specifics.

While concerned about the inability of school districts to win voter approval of bonds to construct buildings, Batt questioned whether he would embrace the recommendation for a reduction in the two-thirds majority required for bond passage even if the voting were to be in conjunction with a general or primary election. The governor has suggested he might support a lower percentage under some circumstances such as turnout of a relatively high percentage of registered voters.

Batt also questioned whether the public would accept local option sales or income taxes even if they were imposed only with a supermajority of local voters, with proceeds being used only for property tax reduction.

“I don’t think the general public is much in the mood for any increase in new taxes,” the governor said.

On other points, he suggested the sometimes strident language of the report be reined in by the panel, which included only three representatives from North Idaho and none from groups or organizations representing rank-and-file workers.

And in some cases, the governor proposed alternatives intended to achieve the committee’s objectives.

That was the case with a proposal for a quarter-cent-an-hour payroll assessment on employers to finance worker training. Batt said he is considering legislation that would allow the state to use up to $20 million from the unemployment compensation trust fund, which is approaching $300 million, for worker training, which he called critical to business recruiting.

The issue of financing road improvements has been under study by a special legislative committee all summer, and while Batt told the business leaders they were looking at a full range of alternatives, the focus has been on boosting the fuel tax from 21 to 24 cents a gallon.

That is the same proposal the transportation board floated among legislators unsuccessfully last winter and that has gotten lukewarm reviews from legislative leaders this summer and fall.

But Batt has indicated that he plans to call for some kind of tax or fee hike to pump more money into highway maintenance and construction when lawmakers convene this winter. He made no comment on the committee recommendation, which was to increase not only the fuel tax but also registration fees and the truck tax, also known as the ton-mile tax.

A penny in fuel tax raises about $6.8 million while a dollar in the registration fee, which is currently $44, raises about $1 million.

Idaho’s fuel tax at 21 cents is lower than the taxes in Nevada, Oregon, Washington and Montana. At 24 cents, it would only be lower than Montana’s and match Oregon’s and Nevada’s. Wyoming has the lowest tax at 9 cents a gallon, but a legislative committee there is recommending a nickel increase.

The state’s registration fee is already higher than every state except Nevada, but Idaho and Oregon are the only ones of the states in the region that do not charge property tax on the value of vehicles.

The Legislature spent several sessions during the mid- and late-1980s trying to revise the truck tax only to repeatedly become bogged down in warnings that any real changes would severely damage the state’s trucking industry.