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Proposed 4.2-cent gas tax increase a step closer to passage

New Hampshire Union Leader

March 04. 2014 9:16PM

  • Which should rise to raise $32M sought by NHDOT for road and bridge repairs?
  • Up gas tax 22%
  • 25%
  • Up vehicle registration 29%
  • 25%
  • Neither
  • 50%
  • Total Votes: 8

CONCORD- New Hampshire is one step closer to the first increase in the state's gasoline tax in more than 20 years.

The Senate Ways and Means Committee voted 4-1 on Tuesday to endorse a 4.2-cent increase in the tax, currently set at 18 cents a gallon. It would be effective July 1.

The bill's chief sponsor, Sen. Jim Rausch, R-Derry, expressed optimism that SB 367 would clear the full House and Senate, after a provision triggering automatic increases tied to the consumer price index was removed from the legislation.

"I got a very nice vote out of Ways and Means, and I believe we will be able to get a positive vote out of the Senate and out of the House as well," said Rausch, who also serves on the five-member Ways and Means Committee.

The bill is expected to raise an additional $32 million for the Department of Transportation, which has pledged to use the money exclusively for road and bridge repair.

Gov. Maggie Hassan is expected to sign the bill into law if it lands on her desk.

"I want to thank Sen. Rausch for leading efforts to take an important step toward addressing our transportation needs, and I encourage members of both parties to support the committee's bipartisan recommendation to strengthen our roads and bridges," she said after the vote.

A proposal to increase the gas tax by 12 cents over three years passed the House last session, but was killed in the Senate.

Opposition to bill

This year's measure is opposed by representatives of the state's trucking and forestry industry, along with the Americans for Prosperity, a conservative advocacy group.

"The stunning tone-deafness of the Senate Ways and Means Committee to recommend a 22-percent increase in the tax on gas and diesel on the same day the front pages of New Hampshire newspapers show that the price of natural gas will be doubling shows just how out of touch these legislators are with the impact of energy prices on the working families and employers across the state," said Greg Moore, AFP-NH State Director.

Senate President Chuck Morse, R-Salem, was the only member of Ways and Means to vote against the measure.

"I don't support raising the gas tax in New Hampshire. You can call it anything you want, but it's still a gas tax," he said, alluding to the fact that the levy is officially known as the "road toll" because theoretically it is paid only by motorists or truckers based on the miles they drive.

Anyone who purchases gasoline for power tools, boats or vehicles that do not use "public ways" is entitled to a refund of the tax if they go through the application process with the Department of Safety.

"I think it takes us in the wrong direction," Morse said, "and I don't see anything in the legislation that guarantees it will go directly to roads."

If the bill had been targeted for a particular road project, such as the widening of I-93, or replacement of a specific bridge, Morse said he would have been more likely to offer his support.

Automatic increases

Rausch's bill increases the current gas tax using a formula based on changes to the Consumer Price Index in the 10 years from 2003 to 2013.

That comes out to slightly more than 4 cents a gallon.

His original bill would have kept the initial hike in place for four years and automatically increased the tax every four years thereafter, using a similar formula.

In an earlier hearing, Rausch said he used the four-year framework because prior to 1991, the tax had gone up on average every four years.

Business leaders and several lawmakers said they could support the four-cent increase this year, but not the automatic increases every four years.

"If they feel it is preferable to go through these battles in the future, then so be it," Rausch told the Union Leader last week.

In previous testimony, DOT Commissioner Chris Clement told the committee that gas tax revenue has been declining due to the recession and improvements in fuel efficiency while the state now has 140 red listed bridges, 37 percent of its roads are in poor condition, and the expansion of I-93 is underfunded by $250 million.

With the increase, the gas tax in New Hampshire will be slightly more than 22 cents per gallon, compared to a national average of 31 cents per gallon, according to the American Petroleum Institute.

According to, the average price of a gallon of gas in New Hampshire Tuesday was $3.47; the average price a month ago was $3.32.

Moore, at AFP-NH, predicted that the legislative battle is far from over.

"The taxpayers of New Hampshire can only hope that common sense will prevail when the public hears about this new raid on their pockets," he said.

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