N.H. Truckers: Diesel Tax Hike Would Hurt Business

Fri March 27, 2009 - Northeast Edition
Norma Love - Associated Press



By Norma Love

Associated Press Writer

CONCORD, N.H. (AP) Truckers told state lawmakers on March 13 that a proposal to raise New Hampshire’s gas and diesel tax 15 cents will badly hurt their industry, while paving contractors said the hike was needed to fund critical road and bridge repairs.

Under the gas tax proposal, the state’s 19.6 cents-per-gallon tax would rise 15 cents over three years — a nickel a year. When fully implemented, the tax increase will generate $111 million annually. In response to truckers’ complaints, the bill’s sponsors proposed an amendment to spread the diesel tax increase over 10 years.

Truckers told the House Ways and Means Committee the tax increase would harm their business even if the hike is phased in.

But paving contractors said truckers would pay more in fuel if they have to plan routes around a growing number of bridges with limits on their weight capacity because they need to be fixed.

Gov. John Lynch has proposed an alternative plan to raise money for road and bridge repairs. In part, his plan would raise registration fees $10, use turnpike toll revenues to pay for maintenance of interstate highways, raise tolls and eliminate a 50 percent discount on tolls for noncommercial E-ZPass users. Frequent noncommercial E-ZPass users would pay a maximum of $30 per month in tolls.

The House rejected the E-ZPass change and has not acted on the other provisions.

Nashua Democrat David Campbell, the gas tax bill’s prime sponsor, said both sides agree the state’s infrastructure needs more money for repairs.

“We are on the verge of a system falling apart,’’ Campbell said. “Pot holes don’t lie. They make a better and louder case than any lobbyist or lawmaker.’’

Campbell acknowledged the truckers’ opposition, but insisted they pay a fair share because “it is a user fee and they have heavier vehicles.’’

Campbell noted that Lynch’s plan only shores up the system for two years while the gas tax increase would be a long-term fix.

“Our goal is to get through these next two years,’’ Transportation Commissioner George Campbell said of Lynch’s plan.

Witnesses disagreed whether the tax would show up immediately in the pump price.

Freedom Republican Mark McConkey, a gas station owner, said the tax doesn’t dictate his price.

Economist Lisa Shapiro said a nickel or dime tax increase won’t influence behavior like last summer’s dramatic hike in prices.

“The catastrophic impact of a nickel is not borne out,’’ said Shapiro on behalf of asphalt manufacturers.

She projected that 1,000 construction jobs would be added to the economy by increasing highway spending.

But oil dealers Bob Farr of Wilton and Floyd Hayes of Bedford argued the price is sensitive to tax hikes. Motorists will cross the border to Maine, Vermont and Massachusetts if the hike means those states have lower prices, Hayes said.

Road paving companies and contractors also differed with truckers which plan was better: hiking taxes statewide or tolls in the central, southern and seacoast regions.

Loggers and truckers, mostly from northern New Hampshire, supported Lynch’s plan to raise tolls instead.

Road paving companies and contractors backed the tax increase as a better solution for the long term. The $129 million in federal stimulus funding New Hampshire is receiving for road and bridge projects won’t be enough to fix the infrastructure, they said.

“This year, next year are the best years we are going to have,’’ said Gary Abbott, executive vice president of the Associated General Contractors of New Hampshire. “After that, we’re falling down a cliff ... We’re looking at the stimulus as a bump.’’

But Orford tree farmer Tom Thomson objected that truckers would pay thousands of dollars in higher fuel costs at a time when they can least afford it.

“Now is not the time to increase taxes on any of our citizens,’’ he said.

And Monroe logger Rocky Bunnell, his voice breaking, said his family is putting in long hours now just to survive.

“It is a tough time and this industry is in trouble,’’ he said.