Mississippi House leaders propose increasing gas tax; Senate leader opposes idea
Published 9:20 am Friday, April 13, 2018
JACKSON (AP) — Mississippi House leaders are proposing a new long-term plan to put hundreds of millions of more dollars into transportation, days after Gov. Phil Bryant ordered more than 100 locally maintained bridges to be closed because they are in dangerous condition.
However, Lt. Gov. Tate Reeves, who keeps tight control over the Senate, is knocking down a significant part of the House proposal.
“I am a Republican. I am a conservative. I am against raising gas taxes,” Reeves told reporters hours after Speaker Philip Gunn, a fellow Republican, unveiled the House plan.
The House plan includes a tax swap Gunn said would take about as much money out of the state budget as it would put in, but would direct more cash to infrastructure.
Over four years, the 4 percent income tax bracket would be phased out and a gasoline tax increase would be phased in. The current state gas tax is 18.4 cents a gallon, and it would increase 2 cents a year for four years to hit 26.4 cents. Gunn said it could also increase later, tied to inflation.
“This money belongs to the citizens, and the citizens expect us to use it to address the things that are important to them and to address their needs,” Gunn said. “And we, in the House, believe that roads (are) the function of government.”
The House plan would also direct a portion of “use tax” collections to roads, bridges and water and sewer projects. The use tax is paid on goods that are shipped from out of state for use, storage or consumption in Mississippi. It generates about $315 million a year, and that number is increasing. Gunn said House leaders propose setting aside 35 percent of use tax collections for infrastructure, splitting most of the money among cities and counties and putting part into a local bridge replacement program that already exists.
House leaders also propose that 1 percent of cash left over at the end of a state budget year should be put into infrastructure, for five years. If there is leftover money now, 2 percent is supposed to go into the state’s cash reserves, commonly called the rainy day fund.
Under the final part of the House plan, the state would issue $30 million in bonds for five years to pay for emergency infrastructure projects.
Bryant could call legislators into special session at some point to consider a long-term plan to pay for transportation. Gunn said House leaders are sending their proposal to the governor and Reeves as a way to restart House-Senate discussions. The two chambers could not agree on a long-term transportation funding plan during the nearly three-month session that ended in late March.
Reeves said the Senate is sticking with his proposal from the regular session, which aims to put an additional $1 billion into transportation over six years, partly by diverting year-end cash into transportation rather than the rainy day fund.
Reeves’ plan would put little or no new money under control of the Mississippi Department of Transportation for state highways and bridges, giving the governor control over more than $800 million through the middle of 2024. The plan would divert $25 million a year from current state highway funding to a new emergency bridge fund.
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