18 Mar Gov. Kay Ivey signs Alabama gas tax hike into law
Alabama Gov. Kay Ivey signed a bill into law Tuesday afternoon that raises Alabama’s fuel taxes by 10 cents over three years to increase funding for roads and bridges.
The Alabama Senate passed the main bill by a vote of 28-6 earlier in the day.
The vote marked a continuation of the bipartisan support for a plan Ivey and Republican legislative leaders called their top priority. Ivey called a special session to handle the issue and the legislation passed within the minimum five days.
It passed the House by a vote of 84-20 last week and won approval in a Senate committee by a vote of 12-0 on Monday.
The plan would raise an estimated $320 million a year for road construction and maintenance. About $12 million a year would go to a project to improve the shipping channel in the port of Mobile.
The plan received bipartisan support in the 105-member House, with only two of the 28 Democrats voting against it. In the Senate, 22 of the 28 Republicans voted for the plan and six of the eight Democrats voted for it.
Senate President Pro Tem Del Marsh, R-Anniston, a leading advocate for the plan, said after today’s vote that the plan won’t change Alabama’s status as a low-tax state and will promote economic opportunity.
“We are in a position because of being a very efficient government, doing things the right way, to pass a piece of legislation that in my opinion is going to allow an opportunity for our children and grandchildren to stay in Alabama, find good jobs here, earn a good living,” Marsh said. “So, this is about the future of Alabama. We’re all participating in this. But it’s a great day for Alabama.
Despite the plan’s strong support in the Legislature, there was opposition outside the State House. The state Republican Party executive committee voted to oppose a gas tax increase without an offsetting tax decrease. Opponents of the plan formed a political action committee to campaign against it.
They say the tax would be a betrayal of Alabama taxpayers who elected Republican leaders.
Others have argued that the tax will hurt low-income families, the same group that could have benefited from Medicaid expansion, which Republicans have opposed.
Proponents say the plan has been studied and revised and will address problems of aging bridges, traffic jams, Alabama’s high rate of traffic fatalities and difficulties in moving products for business.
“I look at this as a great opportunity for citizens,” Marsh said. “We’re doing the right thing.”
The plan will raise the state tax on gas and diesel fuel by 6 cents a gallon after Aug. 31 this year. It will increase by 2 cents a gallon on Oct. 1, 2020 and again on Oct. 1, 2021. The tax is now 18 cents a gallon for gasoline and 19 cents for diesel. It has not changed since 1992.
Sen. Clyde Chambliss, R-Prattville, sponsored the legislation in the Senate.
In addition to the 10-cent increase over three years, the bill links the state fuel tax to a national index on highway construction costs that could adjust it by a penny every two years beginning in 2023.
“It’s not extreme, it’s not exorbitant,” Chambliss said.
Sen. Vivian Davis Figures, D-Mobile, said today she supports rebuilding the state’s infrastructure but opposes the gas tax. Figures said it would hurt the same low-income families who could have benefited from Medicaid expansion, which the state’s Republican leaders have resisted.
Figures said she didn’t understand the justification for passing the bill quickly during a special session.
Figures was one of the six senators to vote no today. The others were all Republicans, Sens. Will Barfoot of Montgomery, Jim McClendon of Springville, Dan Roberts of Mountain Brook, Shay Shelnutt of Trussville and Larry Stutts of Sheffield.
Roberts, a first-year senator, proposed an amendment that would have increased the tax 10 cents this year, rather than over three years. His amendment would have set aside $40 million a year for to set up a fund to pay tax credits as an offset to the increased fuel tax to people who qualify based on income. And it would have stopped the automatic link to the highway construction cost index after 2039.
Chambliss opposed adding the amendment and the Senate tabled it. Chambliss pledged to work with supporters of the amendment during the regular session, which resumes March 19.