Nebraska gas tax increase bill headed to final vote

By GRANT SCHULTE

Associated Press

LINCOLN, Neb. (AP) - A proposed gas tax increase advanced to a final vote in the Nebraska Legislature on Monday despite opponents who said the state should find another way to repair roads and bridges.

Lawmakers gave the bill second-round approval Monday with a 27-14 vote after nearly four hours of debate.

One more vote is required before the legislation moves to Gov. Pete Ricketts, a Republican who strongly opposes the measure. In a statement Monday evening, Ricketts criticized the bill as a “big government solution” and said he intends to veto it if it arrives at his desk.

“Once again, the Legislature has chosen to prioritize tax hikes over tax relief measures that Nebraskan need and deserve,” Ricketts said.

Overriding a veto would require at least 30 senators, but six who were present on Monday abstained from voting.

The measure would raise Nebraska’s fuel excise tax by 6 cents per gallon over four years, for a total state tax of 31.6 cents per gallon. The bill would generate an estimated $76.2 million a year when fully implemented, split evenly among the state, county governments and cities.

Sen. Jim Smith of Papillion, the bill’s sponsor, said the tax increase would help chip away at a state backlog of deficient roads and bridges. In a report last year, the Department of Roads identified $10.2 billion in projects it says are needed over the next 20 years.

“It’s going to take us a long time to dig ourselves out, but this is a start,” said Smith, a conservative business owner who regularly advocates for tax cuts. “This is a small, modest, reasonable user fee.”

Opponents said the tax increase will disproportionately affect the poor because many spend a larger proportion of their incomes on gas.

“We are not going to build the bridges and pave the roads on the backs of the least among us,” said Sen. John Murante of Gretna.

Sen. Beau McCoy of Omaha disputed that lawmakers have exhausted all options, such as issuing bonds or tapping the state’s cash-reserve fund. A bond proposal introduced last year was defeated, and lawmakers in recent years have hesitated to tap the cash reserve.

“We’re going toward the big government solution - a tax increase,” McCoy said. “I don’t think we should ever resort to raising taxes. That’s not what I came here to do.”

Sen. Kate Bolz of Lincoln said issuing bonds to pay for roads and bridges was a better approach than an increase in the gas tax.

Nebraska’s gas was the 26th most expensive nationally because of its taxes and fees as of Jan. 1, according to the American Petroleum Institute. Last month, the state’s gas tax fell behind Iowa’s for the first time in decades after a new gas tax went into effect there.

Nebraska’s share of Federal Highway Trust money has fallen faster than the national average in the five-year period that ended in 2013, the last year for which numbers were available. The state saw a 5.2 percent drop while funding for all states fell by 3.5 percent.

Nebraska has more than 100,000 miles of roads and 20,000 bridges, mostly owned by counties and cities. Roughly 10,000 miles of road and 3,500 bridges belong to the state.

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