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Ark. Looks Beyond Gas Tax to Fund Road Improvements

Wed May 23, 2007 - Southeast Edition
CEG



ROGERS, Ark. (AP) The chairman of Arkansas’ highway commission said May 5 the rising interest in electric and hybrid cars means the state must look beyond gas and diesel taxes for additional funds to improve roads.

“If gasoline comes up and spikes to three and a half dollars per gallon, guess what? This revenue is going to go down. People are going to drive electric cars, more energy-efficient vehicles, ethanol, biodiesel-related products and these revenues are going to go flat,” commission Chairman Jonathan Barnett told members of the Arkansas Associated Press Managing Editors Association at its convention.

Barnett cited the increase in electric and hybrid vehicles as one factor when telling the group that new revenue sources need to be found to meet the state’s growing highway needs, estimated at $16 billion over the next decade.

“They’ll just take more revenue from the system, because there’s no revenue in electricity for highways,” Barnett said after his speech.

Barnett said ideas such as diverting sales tax revenue from used and new car sales and new taxes may have to be explored as ways to raise money for state roads.

“People tend to think that since we have a dedicated revenue source, we have adequate revenue,” Barnett said. “That revenue may have been adequate in years past, but in this day and time we know that every state, not just Arkansas, is in trouble. The way we have funded projects in the past may not be the way to do it in the future.”

Barnett said he doesn’t necessarily favor tolling existing interstates, but said a lack of money could mean the federal government may push for states to toll more roads to raise funds.

“I think you’re going to start seeing the feds start giving the states a lot more ability to toll the existing interstate system,” he said. “As the states struggle to find revenue sources and the feds struggle to help the states find revenue sources, there’s not a lot of places to go to ... Those are fighting words to a lot of people, including the trucking community, but years down the road I don’t think we’re going to have a lot of choice but to consider those options.

The Legislature appropriated $80 million for road improvements during this year’s legislative session and $56 million of that will go to the highway department, Barnett said.

Barnett said he also expects Gov. Mike Beebe to set aside $20 million for road repairs from the governor’s portion of the General Improvement Fund.

“Without that $56 million, we wouldn’t be able to have an overlay program this summer or next summer so we’re very appreciative,” Barnett said.

Barnett said he’s hopeful that the next legislative session in 2009 will focus more on highway issues. This year’s session included additional money for highways and legislation to put a highway bond proposal on the ballot, but Barnett said more comprehensive help is needed.