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    Thursday, April 25, 2024

    Tolls make more sense than higher gas tax

    Since my column last week, arguing that installing electronic tolls on state highways remains the best means of paying for Connecticut’s transportation needs, an alternative proposal has been placed back on the table — raising taxes.

    “I do anticipate a conversation around fuel taxes,” Rep. Roland Lemar, D-New Haven, co-chairman of the Transportation Committee, told Keith Phaneuf of the Connecticut Mirror.

    This is what you get, anti-toll folks, because the need to address Interstate 95 congestion, shore up aging bridges and overpasses and provide a modern commuter rail system did not go away with the defeat of Gov. Lamont’s toll proposals.

    The state Office of Fiscal Analysis recently projected that costs will outstrip revenues by 2024, leaving the Special Transportation Fund insolvent.

    Connecticut charges a 25-cents-per-gallon tax at the pump which, as Phaneuf noted in his recent reporting, has been frozen for much of the 21st century. Also adding to the cost of gasoline is the Petroleum Products Gross Receipts Tax of — effectively — about 8.8%. It is assessed on wholesale fuel transactions and passed along to consumers.

    Add it all up, reported the Connecticut Mirror, and it comes to 36 cents per gallon, not bad when compared to the 43.5 cents national average, making it a prime target for an increase.

    The problem is, when gasoline prices go back up, and they eventually will, the tax burden goes up with them due to the gross receipts tax. Any increase in the gross receipts tax may not hit wallets too hard now, but if we see $4 gas again — or should I say, when — any percent increase approved now will really hurt.

    Using higher gas taxes, as opposed to tolls, to pay for transportation needs means Connecticut residents will continue to provide the bulk of the money to maintain our highways, with millions of out-of-state drivers getting a free ride through the state, unless they choose to gas up here.

    Gas taxes will provide diminishing returns as motor vehicle efficiency improves and the fleet of hybrid and electric cars expands. Some dandy driving a $140,000 Tesla Model S Plaid won’t be paying for transportation through a gas tax, but a low-income family getting by with a gas-guzzling old minivan sure will.

    Also, in a guest commentary, state Senate Minority leader Len Fasano criticized my column for characterizing the alternative plan that Republicans had offered in their opposition to tolls — FASTER CT — as a “borrowing” plan.

    Fasano repeated his contention that Republicans would provide for billions of dollars in transportation work without raising any new revenues or borrowing.

    “Since the Republican plan is not a borrowing plan,” he wrote, "there is obviously no new revenue source needed."

    No borrowing, no revenue — it must be a magical plan. It defies the first law of thermodynamics, which boils down to “you can’t get something from nothing.”

    The Republican plan did involve diverting resources from the rainy-day fund (that sounds bad to begin with) to pay down a portion of the state’s massive pension fund deficit, thus freeing up other spending, which otherwise would have gone into the pension fund, to underwrite transportation. Got it?

    This Rube Goldberg machination never went far, meaning the rainy-day fund is available to deal with a real emergency — the fiscal fallout from the pandemic. No one is proposing FASTER CT anymore and Fasano is on his way out, having not sought re-election.

    Fasano also thought it unfair that I criticized the Republican opposition to tolls when Democrats controlled the legislature. He’s got a point there. Democrats acted cowardly. They should have passed a toll bill. Instead, it looks like they’ll raise your gas taxes.

    Paul Choiniere is the editorial page editor.

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