Phasing out Pa.’s gas tax creates a new challenge: What comes next? | Editorial
Gov. Wolf called the gas tax “unreliable” and “burdensome,” and he has a point. But coming up with a better alternative in four months is a tall order.
In his latest transportation-related announcement, Gov. Tom Wolf has put the cart before the horse.
On March 12, the governor announced the he signed an executive order establishing a Transportation Revenue Options Commission — a bipartisan commission that will “develop comprehensive funding recommendations for Pennsylvanias’s large and aging infrastructure.”
A review of transportation funding, including keeping Pennsylvania’s roads and bridges in a state of good repair and new infrastructure projects, is a welcome idea. For years, revenues have always trailed crises, leaving a flawed system that routinely gets failing grades. According to PennDOT’s last assessment, they are operating with an annual funding gap of $9.3 billion from the full need.
The commission will meet for the first time this week, and is due to provide recommendations by Aug 1, 2021.
However, in virtually the same breath, Wolf also committed to phasing out the gas tax — the type of recommendation one would expect a Transportation Revenue Commission would come up with, not one announced when the commission is established.
Currently, Pennsylvania charges a tax of 58 cents per gallon of gasoline. That tax generated an estimated $1.69 billion last year and is expected to generate $1.86 billion next year, according to Wolf’s budget proposal. Revenues not only fund transportation projects, but a portion of the $1.4 billion state police budget.
The gas tax has few fans. Wolf called it “unreliable” and “burdensome,” and he has a point. The tax is unreliable because as cars become more fuel efficient, the amount of gas consumed goes down leading to fewer revenues — a process that should escalate as electric vehicles become more common. Wolf himself has ordered PennDOT to replace 25% of its fleet for hybrid or electric cars. Pennsylvania’s gas tax could also be characterized as burdensome since it is one of the highest in the nation.
But aside from generating more than a billion dollars for transportation, gas taxes reduce consumption — a win for the climate considering that 28% of all greenhouse gas emissions come from transportation. Since Wolf committed to phasing out the tax, the commission has to ensure that the alternative does not incentivize more gas consumption. Unfortunately, this aspect of the problem might be neglected, since none of the 42 members of the commission come from environmental advocacy organizations.
There is more that the alternative would have to do: funding can’t be regressive, must raise more money than the gas tax, and not disincentivize a move to electric cars. In addition, the commission would need to contend with the fact that most other funding schemes (such as miles-traveled tax) won’t bring in out of state dollars like the pumps in Pennsylvania’s gas stations do. Figuring this out in four months is a tall order.
Pennsylvania desperately needs a long term solution for transportation funding that puts climate change at its center. The worse case scenario for the current plan is that the gas tax is phased out without an adequate alternative, leading to less revenue and more emissions from cars. If Gov. Wolf is committed to a long term solution, his committee will need time — and a clear vision of the future of transportation in Pennsylvania.