Rival Transportation Plan Posed

As a tactic to derail TIME’s proposition (should it make it to the ballot), no-new-taxes lawmakers are preparing their own legislative initiative. This would set up a situation where potentially there could be two similar but competing ballot propositions both dealing with “transportation”. Rep. Russell Pearce’s legislation would put a ballot proposition that would levy a 1/2 percent addition general state sales tax whose revenues would be used for building roads. This is meant to stick it in the eye of TIME’s proposition which spends some of its revenue on public transportation — but not very much, 78% is on roads and freeways and only around 20% is on public transit. Rival Transportation Plan Posed, Arizona Republic, May 30, 2008.

AZ gas tax facts

Arizona ranks on the low end in terms of taxation of motor fuels versus other states. According to the Tax Foundation, Arizona ranks 41st.

State-to-state comparisons are enve more complex: some states levy sales taxes and others -- including Arizona -- do not. So any ranking is only valid at some particular price per gallon. And in a high gasoline price environment, it will tend to push Arizona even further down in the rankings.

In any event, motor fuel taxation in Arizona is pretty straightforward: Gasoline is 18 cents per gallon, plus 1 cpg for UST (Underground Storage Tank cleanup fees). Federal is 18.4 cpg making the total 37.4 cpg for gasoline sold in Arizona.


The Arizona tax rate of 18 cpg was last changed in 1991 -- going on two decades ago. In the meantime to simply keep up with inflation, the tax would need to be over 28 cpg. But what has our leadership done? Nothing.

Compare this to the general state sales tax (and keep in mind, there is no sales tax on fuel), which is cleverly figured as a percentage. This means that whenever inflation raises the price of goods, the state gets more revenue. So for example the tax on a dollar cup of coffee in 1991 brought in 5 cents revenue to the state, and now it magically brings in 8 cents. All without lifting a legislative finger, and no kooky ballot initiatives.


(Diesel is xx + 1 cpg UST? + federal = ?? cpg)




http://www.arizonagasprices.com/tax_info.aspx

The Initiative

Here is the filing from the Arizona Secretary of State's website, the deadline is July 3 to collect 153,365 signatures:

I-24-2008 Transportation and Infrastructure Moving Arizona's Economy ("TIME") Act
T.I.M.E. Initiative
1001 North 1st Street
Phoenix, AZ 85004
602-256-9109
Martin L. Shultz, Applicant 602-250-2866
J. D Pruitt, Chairman 480-293-3000

The T.I.M.E. Initiative will reduce congestion, offer modern transportation choices and preserve our spectacular open spaces by upgrading Arizona's statewide transportation system. The Initiative builds needed highways, freeways and roads; creates rail options for commuters and travelers; and protects our enviroment by creating better bike paths, walkways, and safer school routes. The plan imposes strict performance and accountability measures to ensure that money is being used efficiently and that the projects improve quality of life in tangible ways. These improvements to our transportation system are funded through a one cent adjustment to our statewide sales tax over 30 years.
Click here for full text of initiative: PDF

The basics

The proposal is to raise the state sales tax from 5.6 cents to 6.6 cents for thirty years. Somehow this comes out to $42.6 Billion.

• This is an 18% tax increase.
• Sales taxes in Arizona cities would be among the highest in the nation. (for example, the rate in Phoenix would be 9.3%, Tucson 9.1%).
• Governor Napolitano, who backs the proposal, states that sales tax is the "only possible" means to pay for these monies.
• There is no sales tax on fuel (gasoline or diesel), presently or proposed.

The projects:

The vast majority, some 78%, would be earmarked for building roads.
A small portion would be devoted to public transportation projects -- mostly a rail line between Phoenix and Tucson.

sources:
Arizonans to get preview of $42 billion transportation tax plan Arizona Republic, May 4, 2008

Just say no

Just say NoToTime. The TIME "transportation" initiative.

From Here and Now, May 14, 2008:

No sooner does the governor receive an award for championing education and early child development than a report surfaces that the governor's office helped broker a deal to keep opposition to a new transportation tax to a minimum. A document leaked to the East Valley Tribune shows a behind the scene's quid pro quo: a homebuilders association agreeing not to contest a transportation tax if a development impact fee is removed from the proposed transportation plan. The deal also calls for homebuilders not to oppose a state trust land measure that will be on the November ballot.

Here's a pretty cute satirical view from the Arizona Report "The Governor’s secret backroom has been booked solid since the news broke that the homebuilders were able donate to thousands of dollars in financial support in exchange for preventing millions of dollars in impact fees"

Unfortunately, it is all too true, here is the leaked document:




...
I love Talton's title: On transportation, stuff you can't make up .