High Fuel Prices Sour Arkansas Truckers to Diesel Tax Compromise

LITTLE ROCK (AP) — Rising prices at the pump have soured truckers on any compromise to raise fuel prices to pay for better roads, an industry's spokesman said Thursday.

Truckers won't go along with the latest version, which imposes a 2-cent-a-gallon diesel tax increase immediately and adds 2 cents more in a year.

The House Revenue and Taxation Committee approved the Senate proposal with little comment Thursday and sent it to the full House, where highway plan leaders say they'll try to pass it with or without truckers' blessings.

"Those of us who have been so involved in this, who have worked so hard, have compromised all we can," said Rep. Bobby Glover. "I feel like we have the votes and we're going to go with it."

A House vote is expected Friday.

Gasoline prices have surged nearly 8.5 cents per gallon at the pump over the past two weeks, reflecting a rise in crude oil prices.

Lane Kidd, president of the Arkansas Motor Carriers Association, said the industry is worried about analysts' predictions of a 10-cent-a-gallon diesel fuel increase by mid-summer.

An additional 22-percent diesel tax increase within a year doesn't sit well with the industry, Kidd said.

"That has trucking companies very concerned. It's a very big reason whey there is very much anxiety," he said. "We won't be over there lobbying for" the latest fuel tax increase plan.

The group would prefer to phase in the diesel tax increase a penny a year, same as a proposed 3-cent a gallon gasoline tax increase.

The House originally proposed such a provision, but the Senate increased the diesel tax to place a heavier burden on big rigs that do the most damage to roads.

Last week, the trucking industry acquiesced to a 4-cent-a-gallon increase but vehemently opposed a Senate plan to impose the entire hike all at once, saying it would be a immediate $20 million tax increase that smaller firms could not pass on to shippers.

The House defeated the all-up-front proposal, forcing the Senate to retreat to this week's compromise.

Highway officials say the 4-cents up front would produce about $60.5 million per year and that the 2-cents up front would produce about $50 million.

Fuel tax increases are part of a package that also includes Gov. Mike Huckabee's $575 million bond issue to speed up interstate improvements. The bond bill, which has passed both chambers, was amended Wednesday by the Senate to conform to the amended fuel tax bill. Huckabee's signature would refer the bond issue to a public vote.

Together, the bills would pay for repairing more than 300 miles of crumbling interstates, pump millions of extra dollars into non-interstate highway construction that started in 1991 and

llocate millions more for county roads and city streets.