Iowa lawmakers doubt proposed gas tax increase will be addressed in 2014

Many believed gas tax increase would be approved this year, along with property tax reforms

March 28, 2014 | 4:25 pm

A quartet of lawmakers agreed Monday they need to raise the state motor fuel tax, but were pessimistic it will happen in 2014 – an election year.

Three Democrats and a freshman Republican expressed disappointment in Gov. Terry Branstad’s apparent failure to hold up his end of a bargain calling for property tax reform in exchange for a gas tax increase.

“I know there were a lot of unhappy people that a fuel tax didn’t pass this year,” said Rep. Bobby Kaufmann, R-Wilton, who represents eastern Johnson County. “The illusion we were given was that if we had property tax reform, that a gas tax would be approved.”

There was a “boomlet” of support for increasing the gas tax for the first time in 24 years, Senate Appropriations Committee Chairman Bob Dvorsky, D-Coralville, said at a post-session legislative forum in Coralville hosted by the Johnson County Task Force on Aging.  He thought there were enough votes in the Senate, but support evaporated in the House.

“We had the votes,” Kaufmann insisted.

Early in the session, Branstad seemed to indicate that if lawmakers approved property tax reform that lowered Iowans’ overall tax liability, he would support an increase in the gas tax for the first time since 1989.

Branstad spokesman Tim Albrecht said the “governor recognizes the need for additional funding,” but lawmakers didn’t follow through.

“He himself opened the door to the fuel tax as a part of overall tax reform during the final days of session,” Albrecht said. “The Legislature shot down the idea of additional road funding through an increase in the motor fuel user fee this year.”

Raising the gas tax would be one way for lawmakers to allay the fears of local governments that the property tax changes will result in lower revenue for them, according to Sen. Joe Bolkcom, D-Iowa City, chairman of the tax-writing Ways and Means Committee.

The need for more revenue to maintain roads and bridges won’t go away, Kaufmann said.

“I’m not a fan of tax increases, but I also don’t feel the need to stick my head in the sand and ignore the infrastructure needs we do have,” he said.

In the long run, the cost to taxpayers may be greater if the Legislature fails to raise the motor fuel tax, lawmakers said. Already some counties are bonding to pay for road maintenance and improvements, he said.

“The interest that will accrue over the course of several decades will be a heck of a lot more than you would have paid for on the gas tax,” Kaufmann said.

Rep. Mary Mascher, D-Iowa City, warned that the governor’s suggestion of diverting sales tax and gaming revenue to the Road Use Tax Fund will harm other priorities.

“Then you’re competing against the education interest, the human service interest, the elderly abuse issues we’ve been talking about,” she said. “Obviously, nobody likes to see taxes increased, but everyone wants safe roads and bridges.”

Despite the fact legislators and Branstad recognize the need, Bolkcom was skeptical the issue will be a priority next year when they are running for re-election.

“We’re going to have to get after this, but I’m a little pessimistic going into an election year … that we’re going to be in a place where (the governor) is going to be advocating for a gas tax increase,” he said.

Legislative leaders have insisted that if they are to raise the tax, it will take the votes of a majority of Democrats and Republicans to avoid political retribution. However, voting for a tax increase in an election year would open incumbents to attacks from challengers.

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