Late last week, Gov. Kay Ivey unveiled the “Rebuild Alabama” bill, a $300 million plan to fund infrastructure improvements by increasing the state gas tax by 10 cents per gallon.
If passed by the Legislature, the state’s existing 18-cent tax will increase to 24 cents on Oct. 1, 26 cents one year later and 28 cents by 2021. Using an average fuel efficiency of 22 gallons per mile and 12,000 miles driven per year, Ivey claims the increase will cost the average Alabamian $55 annually.
The bill, written by House Rep. Bill Poole, also stipulates how the proceeds may be spent, and provides for added accountability over the Alabama Department of Transportation (ALDOT).
One of those stipulations provides for up to $10.2 million per year to be diverted to the Alabama State Port Authority to pay its portion of an estimated $400 million project to deepen and widen the shipping channel. If funded, 75 percent of that project will be paid for with federal dollars, but the gas tax will be used to service as much as $150 million in related bond indebtedness through 2035.
Local leaders have long suggested the project will benefit business and industry across the state, and recently have coordinated an effort to curry favor for the plan with legislators statewide. The perception is legislators who oppose the tax altogether, plus those from rural areas who may not see as much of a local return, would possibly move to block a bill that does not include equitable investment in their districts.
On Thursday, the Coastal Alabama Partnership hosted about 65 members of the Legislature at its Regional Economic Summit in Mobile to promote the plan. Literature was distributed highlighting the port’s support of 153,278 jobs statewide, $568 million in tax revenue and $25.1 billion in economic value, representing 12 percent of the state’s gross domestic product. Afterward, the lawmakers boarded the Perdido Queen for a cruise around the Mobile River.
House Majority Leader Nathaniel Ledbetter said he was pleased with the summit.
“To see [the port] firsthand, I think it’s positive … what we’ve seen today is pretty impressive,” he said, noting his native Dekalb County is the state’s leading producer of poultry and already heavily relies upon the port for international exports.
“Of course, the automotive industry has become strong in my part of the state, and to see what is happening with these roll-on/roll-off facilities the manufacturers are using I think could be huge … so it certainly can be a partnership the whole state can benefit from.”
Ledbetter said his district suffers from “severe” road neglect, where school bus drivers opted to take more than 30,000 miles in detours last year rather than cross defective bridges.
“It’s a safety issue when you have to keep a kid on a bus for an extended period of time just to go around bad roads and bridges,” he said. “Everybody sees a need, it’s just a question of how we get there. I feel good about [the bill] and doing something positive for the state and investing in the next generation.”
State Sen. Clyde Chambliss was similarly impressed by the port’s facilities and said he understands the benefits of additional investment, but admitted his constituents have mixed feelings about the possibility of paying more at the gas pump.
“They don’t want to pay more taxes, I don’t want to pay more taxes, but if you look at it from an objective point of view, we paid 6.5 percent of our income in state taxes in 2011 and now it’s down to 4.5 percent of our income, so there are times when we have to adjust rates, especially on something like the gas tax, which is not a percentage and does not grow over time,” he said. By Saturday, Chambliss had issued a statement indicating he would sponsor the bill.
“I explain that the gas tax has remained stable in revenue dollars, but the buying power has gone down because of the increase in construction costs … what we could buy in 1992 when we last [raised the gas tax], we can only buy about 60 percent with the same funds today,” his statement reads.
Chambliss said a priority transportation project in his district is widening portions of U.S. Route 82 between Prattville and Tuscaloosa, currently a two-lane road linking the state capital to its “flagship” university. There, traffic and accidents have increased significantly over the years, he said, causing many preventable injuries and deaths.
“The average Alabamian will only pay about $55 extra per year with this gas tax, and that’s a small price to pay for such a real safety issue to me,” Chambliss said.
Others were more reserved. While acknowledging his District 54 has major infrastructure problems, Freshman House Rep. Neil Rafferty expressed hesitation about committing to the port funding.
“With the proposed gas tax, my main concern is making sure my constituents — Jefferson County and the city of Birmingham — get what they need,” he said. “For us, it’s roads, roads, roads — plus money for public transit — and we have a lot of potholes that need to be patched.”
Meanwhile, Lt. Gov. Will Ainsworth was also on board — not just the Perdido Queen, but with Ivey’s infrastructure plan.
“This is Alabama’s port, it’s not just Mobile’s,” he said. “[This project] is critical for not only continuing to grow the local economy, but the entire state.”
Ainsworth said a key part of the legislation will be the reform of the Joint Transportation Committee to add oversight and accountability over ALDOT.
“If the tax passes, people need to know how the money is being spent … in an efficient way and also in a need-based way instead of based on politics,” he said.
The bill would send 66.6 percent of the proceeds to the state, 25 percent to counties and 8.3 percent to municipalities. The bill accompanies this article on lagniappemobile.com.
Rumor circulated among those in attendance that Gov. Ivey may table the gas tax bill for a special session, where it would only require a simple majority to pass rather than the three-fifths necessary during a regular session. The session began Tuesday, but as of Monday, Ivey had not substantiated those rumors.
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