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Gov. Tom Wolf Proposes Phasing Out Pennsylvania's Gasoline Tax

Tue March 16, 2021 - Northeast Edition
Associated Press

Amid a deepening stalemate over financing highways and public transit, Pennsylvania Gov. Tom Wolf on March 12 proposed phasing out his state's gasoline tax, the second highest in the nation, and appointed a commission to recommend alternative ways to pay for the state's needs.

Wolf ordered a panel of several dozen lawmakers, transportation industry representatives, transportation planners, government officials and others to deliver recommendations by Aug. 1 of funding alternatives to foot the extra billions of dollars deemed to be necessary.

"Our economy, our communities and our future rely on a strong transportation system that supports our safety and growth," Wolf said in a statement.

The gas tax that Wolf calls "burdensome" is not keeping pace with transportation and safety needs as vehicles become more fuel-efficient and more motorists buy electric vehicles, state officials said.

Many states are seeing stagnant revenue from gasoline taxes, the major source of cash for highway construction, and are increasingly experimenting with user fees.

The Pennsylvania Department of Transportation (PennDOT) has said its current highway and bridge budget for construction and maintenance is approximately $6.9 billion per year, less than half of the $15 billion that is needed to keep the state's highways and bridges in good condition and ease major traffic bottlenecks.

To raise approximately $2 billion over the next few years, PennDOT is seeking to add tolls to nine major bridges on interstates around the state to finance reconstruction projects, drawing objections from some lawmakers. The Interstate 83 bridge in Harrisburg is one of the bridges being considered for tolls.

Lawmakers are discussing slapping fees on electric vehicles, while Wolf has proposed, without success in the Legislature, finding ways of weaning the state police budget off highway construction funds.

Meanwhile, the Legislature's efforts to fund transportation over the last two decades have run up debt and costs to motorists.

A 2007 law siphoning hundreds of millions of dollars from turnpike tolls each year — now more than $7 billion in total since then — has plunged the Pennsylvania Turnpike Commission (PTC) deeper into debt.

The PTC has more than $14 billion in debt, as of last year, double what it reported a decade ago. It paid $652 million in interest and borrowing costs last year, more than half of its total revenue and more than its operating costs for the year, according to its financial statement.

At the same time, turnpike tolls have more than doubled in 12 years to $47 across the length of the highway and more than quadrupled for motorists who do not have E-Z Pass to $95.30, or almost a quarter per mile.

A 2013 law raised the gasoline tax and various motorist fees to fund more than $2 billion a year for highway construction and other transportation needs.

As a result, Pennsylvania's gas tax is now the second highest in the nation, behind California, at 58.7 cents per gallon, according to an analysis by the Washington, D.C.-based Tax Foundation.

State Rep. Mike Carroll, the ranking Democrat on the House Transportation Committee, told a House hearing in February that the sprawling expanse of Pennsylvania's highways and state roads has not kept lawmakers from peeling off almost half of the gas tax revenue for other purposes.

That includes 12 cents a gallon to the state police budget, eight cents a gallon to local governments, three cents per gallon to the Mon-Fayette Expressway's Southern Beltway in southwestern Pennsylvania and three cents a gallon to the Department of Agriculture and other state agencies.

"Nearly half of the gasoline tax that we collect does not go to PennDOT's responsibility with respect to roads and bridges," Carroll stated.

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