Way back in December of 2017, we published an article explaining that North Dakotans are likely to see a bill during the 2019 Legislative Session that will propose raising the state’s motor fuel tax. I wrote that article after the interim Government Finance Committee held a meeting in which they literally discussed the possibility of toll bridges and toll roads in North Dakota. At the time, I couldn’t help but wonder if the mere mention of such things wasn’t a scare tactic of sorts in the midst of discussion on the apparent need to close funding gaps for roads.
The aforementioned article wasn’t our first on the subject of raising the motor fuel tax. Way back in October of 2017, we published our first speculating that the increase may be coming— and that it would obviously take Republicans to do it.
Well, as predicted, State Senator Larry Luick (R – District 25) — who just won re-election by a whopping 21 votes — is proposing a $0.07 increase from $0.23/gallon to $0.30/gallon. Senate Bill 2288 will be heard on Tuesday morning at 9am by the Finance and Taxation Committee.
If passed and signed into law, the increase would be the state’s first since 2005. The federal tax is 18.4 cents/gallon and hasn’t seen an increase since 1993.
Yet, many question whether the increase is truly necessary. Has the efficiency of state government in regards to this matter been fully vetted?
The fascinating thing to me about the motor fuel tax is how much revenues have increased over ten years without raising the rate. In the 2005-2007 biennium, total collections were $160.8 million. In the 2013-2015 biennium, they were $461.1 million. Now, to be fair, we have to acknowledge that increased revenues in recent biennium’s were due in part to the Bakken Oil Boom. But having said that, revenues were increasing prior to that historic event as well.
I will admit that this issue has some fairly significant complexities. Things like population increase, miles driven, fuel consumption, fuel efficiency of vehicles, etc. are all worthy of discussion. But given the record of our State Legislature on spending, I’m not convinced that North Dakotans should be saddled with a tax increase.
Let us know your thoughts. And, of course, make sure you contact your legislators with them as well.
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Sources:
- https://theminutemanblog.com/2017/12/11/toll-roads-scare-tactics-and-raising-the-motor-fuel-tax/
- https://www.kfyrtv.com/content/news/Toll-roads-possible-462670033.html
- https://theminutemanblog.com/2017/10/26/will-north-dakota-republicans-raise-the-motor-fuel-tax-in-2019/
- https://www.legis.nd.gov/assembly/66-2019/documents/19-1113-01000.pdf
- https://www.legis.nd.gov/assembly/66-2019/committees/senate/finance-and-taxation
- https://www.nd.gov/tax/data/upfiles/media/48thbiennialreport.pdf?20171026084606
- https://www.nd.gov/tax/data/upfiles/media/52nd%20Biennial%20Report_with%20Bookmarks.pdf?20171026084135
