Updated: Gas tax hike touted as good for roads, ripped as bad for economy
CONCORD — Supporters of increases in state road fuel taxes and vehicle registration fees told a legislative hearing Tuesday that New Hampshire cannot afford to keep deferring major repairs to state and local bridges and highways.
"New Hampshire is in the midst of an infrastructure crisis which is well on its way to becoming an infrastructure catastrophe," said Rep. David Campbell, D-Nashua, main sponsor of legislation creating a three-year program of increases in state vehicle registration fees and gas and diesel fuel taxes.
The tax increases in House Bill 617 would bump up the gasoline tax from 18 cents to 30 cents a gallon in 4-cent steps over the next three years. Campbell proposed raising the diesel tax by 2 cents a gallon each of the next three years.
Raising the gas tax to 30 cents a gallon by July 1, 2015, would generate a projected $1 billion for road and bridge projects over the next decade.
Vehicle registrations for most cars would increase $15 over three years. Truck fees would increase by substantially more, depending on weight.
Campbell cited state Department of Transportation studies that suggest 1,660 miles of state roads, or about one-third the total, are now rated in poor condition. The DOT also has 140 of 2,100 state-maintained bridges "red-listed," meaning that at least one structural component is considered deficient.
"This challenges our very ability to govern," Campbell said. "If we can't fix something as basic as this, then why are we sent here."
New Hampshire state gasoline taxes have not increased since 1991, he said.
Supporters at the Committee on Public Works and Highways hearing repeatedly referred to the gas tax hike as a user fee, claiming that the more someone drives, or uses the highway system, the more taxes are paid.
"The gas tax is the quickest way to get money into the system and the fairest way because it is a user fee," said Rep. Carolyn Bouchard, D-Concord.
State Transportation Commissioner Chris Clement said his agency is "revenue agnostic" and takes no position on the tax hike, but said the state's road and bridge system needs investment, especially to finish the Interstate 93 widening project.
"This is a state that takes raising taxes and fees very, very seriously, which I love about our state," Clement said. "There is a time to invest."
The bill would place the highway money in a special fund that could not be tapped for other purposes, and would send 20 percent to cities and towns in block grants and state highway and bridge repair aid.
Rep. Edmond Gionet, R-Grafton, said the casino bill pending in the Senate might be a "better way" to raise money for road repairs than raising taxes.
But Campbell argued that the casino bill wouldn't provide enough to pay for roads and bridges, especially since completing the I-93 project will take $250 million.
District 1 Executive Councilor Ray Burton, who is being treated for cancer, sent a letter to the committee in support of the bill.
Opponents of the tax and fee increases were chiefly from businesses involved in trucking.
Saying he felt like "Custer at Little Big Horn" after hearing a parade of supporters of the bill, Robert Sculley, president of the New Hampshire Motor Transport Association, disputed the characterization of the fuel tax increase as a user fee, saying the result would be higher diesel fuel prices that would hit his industry harder than any other segment of the economy.
"HB 617 will have a detrimental effect not only on the trucking industry as a whole, but particularly on New Hampshire's smaller truck owners and operators," Sculley said. "The focus should be on helping small business to grow and expand and providing New Hampshire residents with good-paying, dependable jobs."
Tom Thomson, a tree farmer from Orford, urged the panel not to endorse the bill,saying it would increase the cost of consumer goods, such as food.
"During a recession is not the time to be increasing taxes and fees on either our citizens or our businesses," he said.
While much of the testimony on the bill centered on transportation issues Tuesday, the legislation still needs an airing before the House Ways and Means Committee, which will focus more on the impact of the tax increase.