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December 14, 2016 4:15 PM, EST

Momentum Building for More Transportation Funding in Tennessee

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Tennessee hasn’t raised its taxes of 18.4 cents per gallon on diesel and 21.4 cents per gallon on gas since 1989. The decision not to index those taxes to the rate of inflation along with the spread of increasingly fuel-efficient vehicles has caused a funding shortfall that the state’s Department of Transportation estimates at $6 billion.

In response, Gov. Bill Haslam, TDOT Commissioner John Schroer and Senate Transportation Committee Chairman Jim Tracy, each of whom conducted statewide listening tours on transportation in 2015, are pushing for the Legislature to address the issue when it convenes on Jan. 10.

“I’ve asked TDOT to give me a 10-year plan, a 20-year plan and a 30-year plan,” Tracy told Transport Topics. “I’m not going to be here that long, but I want to leave a good foundation for the future so legislators won’t have to do this every so often.”

Added Tracy, “We wouldn’t be having this conversation” if the taxes had been indexed 28 years ago.

“We have enough revenue coming in to maintain our roads, but do we have enough to increase the capacity that we need to continue to have economic growth?” he asked, noting that Tennessee is one of just five states that doesn’t borrow money to pay for its infrastructure. “The average citizen of Tennessee pays $160 a year in state gas taxes. I would ask them if they would be willing pay an additional $7 a month to improve the quality of the roads in their area?”

A Nov. 14-29 poll conducted by Vanderbilt University found that Tracy and other state officials might not have to engage in quite so much education. The poll of 1,005 registered voters in Tennessee found 67% support for a 2-cent raise in the gas tax, 55% support for an 8-cent increase and 47% support for a 15-cent hike.

“This issue is a priority for the Haslam administration, and the governor has the support of Tennesseans on it,” Vanderbilt professor John Geer, who directed the poll, said in a press release.”

After a speech to the Nashville Rotary Club on Dec. 5, Haslam said he’s going to push action on transportation funding to his fellow Republicans in the state Legislature, where they have super-majorities in each chamber.

"What we've been doing so far is saying what are the needs, what will that cost us and let's figure out different ways that we might pay for that," Haslam told reporters. "And now it's time to begin having those conversations again with legislators."

Tracy said that a penny increase in the diesel tax would raise $9 million while an equivalent rise in the gas tax would produce $30 million.

“My gut says we need somewhere between $250 million and $400 million a year,” said Tracy, whose House counterpart has yet to be named. “It’s something that’s got be addressed. The longer we wait, the worse it’s going to get. I do think this is probably the year to address it. The trucking industry understands the importance of having good quality roads.”

Indeed, the Tennessee Trucking Association is on board with a fuel-tax hike.

“Continued delay to invest in our infrastructure leads to additional congestion, which will continue to worsen and that reduces our economic competitiveness,” said TTA President Dave Huneryager, who predicted the solution will include a combination of such revenue sources as higher registration fees and indexed fuel taxes. “It has been time [to address the issue] for quite some time. We have a tremendous set of roads to be very, very proud of, but if we don’t invest in them, that will not be the case in the future.”