Governor Garners Support For Gas Tax Increase at MML

As reported by the Washington Post, Governor O’Malley sought to garner support from local municipal officials for an increase in the gas tax to keep roadways and bridges safe, and to create jobs.

Speaking to the 75th anniversary gathering of the Maryland Municipal League, O’Malley sought to build an ally in advance of an expected fight to convince the General Assembly to approve one or more tax increases in January. He suggested there would be more road maintenance money to go around for municipalities if cities and towns press their state lawmakers to support a gas tax increase.

The Governor also offered his support to another recommendation of the Blue Ribbon Commission on Maryland Transportation Funding to index the gas tax to inflation allowing revenues to increase as costs go up.

“The fact of the matter is, it now costs us more to paint the Bay Bridge than it did to build the first span,” he said.

A traditional flat tax on gasoline, O’Malley said, becomes a declining revenue source, as cars and trucks are being designed to get better gas mileage.

He also said higher revenues will be needed to pay for the Purple Line connecting Montgomery and Prince George’s counties, and the Red Line project to expand Baltimore’s transit system.

The Commission issued its final report to the Governor and General Assembly on November 1, which includes 23 recommendations in five issue areas. The Commission’s number one recommendation is protecting the Transportation Trust Fund.  The Commission also recommended raising $870 million in new annual net revenues, which includes the restoration of Highway User Revenues (HUR) to local governments.  The funding proposal to raise this additional revenue is outlined below:

  • A total 15-cent gas tax increase, phased in over three years. At the end of the phase-in, the increase would bring in $491 million annually.
  • A 50% increase in vehicle registration fees, which would raise $165 million a year.
  • Increasing the titling tax rate from 6% to 6.5%. This would bring in $69 million a year.
  • Doubling the fee for emissions testing from $14 to $28. This would raise $22 million a year.
  • Increasing miscellaneous MVA fees, which would bring in $34 million annually.
  • Increasing MTA fares and ending funding of free rides out of the transportation trust fund. This would earn $25 million a year.
  • Indexing gas tax increases to inflation after three years, so the new funds keep pace with the economy.

Other recommendations focus on smart growth, value capture, and public private partnerships.

Coverage of the Commission’s meetings and its final report can be found on Conduit Street.

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