Posted in: Commentary,
by Gregg Laskoski on Feb 12, 2013 06:00 AM
PA Governor Tom Corbett introduced a plan last week that proposes raising gas tax revenues over the next five years to generate more than $5 billion that he says would be well-spent on roads, bridges and mass-transit systems.
The only problem with the plan is that it's short on details.
"How do we (Pennsylvania's taxpayers) finance the plan?" The governor's report answered that question with four sentences (three bullet points!).
"How will the dollars be spent?" The answer to that question got five bullet points.
I think what he's trying to say is "This is a stick-up, but don't worry, you'll be glad when you see how we spend your money."
Pennsylvania residents could be seeing their gas taxes go up by as much as 28.5 cents per gallon once the governor's plan is fully phased in.
Corbett said: “I am proposing two adjustments to the way we provide for our transportation needs,” Corbett said. “I am calling on the legislature to pass a 17 percent reduction in the flat liquid fuels tax paid by consumers at the pump. Second, I am asking the general assembly to begin a five-year phase out of an artificial and outdated cap on the tax paid by oil and gas companies on the wholesale price of gasoline; it is time for the oil and gas industry to pay their fair share of the cost of the infrastructure supporting their industry.”
The Oil Company Franchise Tax is a tax levied by the state on wholesale oil distributors based on the wholesale price of gasoline. By gradually eliminating the cap of $1.25 which was put in place in the early 80’s, Pennsylvania expects to realize approximately $1.8 billion by the fifth year of the plan. The wholesale price of gas reached the $1.25 ceiling in 2006, so funding from the OCFT has not grown since.
Frankly, it seems a bit disingenuous for politicos like Corbett to say: "It's time for oil and gas companies to pay their fair share of the cost of infrastructure supporting their industry," when they have no idea how the tax hike would affect gas prices; and, how much of that increase will be passed along to consumers.
Pennsylvanians deserve greater transparency from the governor and his budget plan.
"How do we finance the plan?" Let's start with some honest answers.