Chairman Pickett updates TAoT board on work of House Select Transportation Committee.

Pickett and TAoT Chairman Brandon Janes

John Roby, Dennis Kearns, Chairman Pickett and Clare Barry view video of new rail terminal at the Port of Beaumont.

 

 

 

 

 

Pickett: Texans Don't Know Gas Tax Fixed at 20¢

 

July 29, 2014

 

State Representative Joe Pickett is an educator by trade and knows how hard it is to get through to people who have major misconceptions about the facts.

 

For weeks Pickett has been crisscrossing the state talking to groups about the way Texas funds its highways and the need to increase funding dedicated to transportation.  He is encouraging Texans to vote in favor of Prop 1, a big step toward addressing the shortfall in highway project funding.

 

Pickett said he finds that most people who have no transportation background assume that the tax on gasoline and diesel is a moving number that goes up when the price of fuel goes up.  That is simply not true.  The tax on gasoline at the pump has remained the same 20 cents per gallon since 1991.


“I tell them that when the price is $3.99 the tax is 20 cents a gallon and when it drops to $3.29 it is still 20 cents a gallon.  And years ago when it was $1.87 it was 20 cents a gallon.  That does not change.  So that has to be part of the conversation when talking about raising the gas tax,” he said.

 
Chairman Pickett said that if he could raise the gas tax he would.  “And I would let everybody know that it is still short term and that it would not be the answer to our problem,” he said.  Like others he thinks such a gas tax hike is probably politically impossible at this point in time.


Rep. Pickett met with members of the Transportation Advocates of Texas in July and talked about the extremely complex system of highway funding that has evolved in the state over several decades. He has been a member of the Legislature for two decades and has a passion for transportation.  He is currently chairman of the House Select Transportation Committee looking at transportation funding, expenditures and finance issues.  The committee will report its findings by the end of the year.


Pickett said that transportation finance has become so complex and convoluted that members of the state’s metropolitan planning organization boards find it too hard to make sense of.


He promised that his committee and a companion committee in the Senate will lay out all the issues in their report to fellow lawmakers.  He said it will include information that people don’t normally see, noting that he is already getting many requests for the copies of the expert testimony delivered in his committee’s first two hearings.


. Pickett hopes that the work of the Senate and House committees will provide a body of information that can be used by members of the Transportation Advocates of Texas and others in the ongoing effort to educate average Texans and in informing members of the Legislature about transportation issues. The Senate Select Committee is chaired by Senator Robert Nichols.


Asked about possible committee recommendations he said it is unlikely that the committees will be recommending raising new revenue.  It is possible that they will propose dedicating part of the vehicle sales tax to transportation and that they may put forward the option of increasing the vehicle registration fee.


He said he senses that the public is putting a higher priority on highway funding this year.  “It is coming as people become aware that we have been borrowing money.  They were not aware of that,” he said.  “I ask them, what do you think about borrowing less and finding another way to do it?  We get pretty good feedback.  They are starting to get it.  They still don’t get the gas tax.  They still don’t know that it is a flat amount.  They still think we are making more as the price of as goes up.  And I just want them to realize that that does not happen.”


He finds that most members of the public are not at all aware that the state is on the edge of a very large highway funding shortfall.  The problem is that the now completed Prop 12 and Prop 14 borrowing programs have resulted in a lot of orange barrels in construction zones in recent years.  “They don’t realize that unless we plug that hole (road construction) is going to take a nosedive – big time,” he said.


He noted that there has been a great deal of discussion in recent years about ending diversions of money from the State Highway Fund to other agencies.  One option is to end diversions through the biennial appropriations process.  Pickett said he would prefer to simplify the funding of various state accounts and end diversions through statue.  That would reduce the chance that funding would be taken away in some subsequent state budget.


AUGUST 5TH HEARING
The House Select Committee will meet again at 1 p.m. on August 5th at the Capitol.  Pickett promised a wide ranging discussion covering topics people have on their minds including the sales tax on autos, raising the gas tax and debt.


The committee will also look at the Texas Mobility Fund which is the only one of the three bonding programs available for highways that still has capacity for new borrowing.  He said it was originally intended to be used occasionally but has become something TxDOT must “live off of.”


He pointed out that debt service on transportation debt financing is greater than the amount going to new construction in the current transportation budget.  “That is terrible in my opinion.”   He noted that HB1, the enabling legislation for Prop 1, requires that TxDOT come up with real cash savings of $100 million and that it use the money to pay down existing debt.


Pickett said his committee will take a look at “some crazy ideas” like replacing the 20 cents per gallon gas tax with a 6.25% sales tax that would in fact generate more revenue when the price of gasoline increases.  “Just like I pay in any retail store.  What’s the difference there?” he asked.  It would take a gasoline price of about $3.20 per gallon to produce the same revenue as the current fixed 20 cent tax rate. 


There is also a federal tax of 18.4 cent per gallon on gasoline and 24.4 cents per gallon on diesel fuel.  A proposal to increase the federal fuels tax rate for the first time since 1993 was introduced in June by two U.S. senators.  It was supported by organizations and editorial boards around the country but conventional wisdom is that it has little chance of passage.


Pickett said the federal conversation about the continuing Highway Trust Fund shortfall has brought new attention to the fact that not enough money is being allocated for transportation.