Local News

State Lawmakers May Lower Gas Tax At Expense Of Highway Maintenance

Posted June 15, 2004

— State lawmakers are trying to give consumers a break at the gas pump.

Bills introduced in the General Assembly this week involve the state tax on gas. North Carolina has one of the highest in the Southeast -- more than 24 cents a gallon.

A portion of North Carolina's gas tax is variable; it goes up as wholesale prices go up. Legislators would like to change that after hearing the concerns of motorists who say prices are high enough.

Gas costs so much that drivers like Jewelene Smith cannot afford to fill up.

According to AAA, North Carolinians can expect to pay about $1.94 for a gallon of regular this weekend. Compared to last year's prices, Raleigh is up 57 cents a gallon and Durham 60 cents.

"It's ridiculous," Smith said. "They need to do something about these prices because people can't even get to work. It's really hard for people."

Bills proposed in the House and Senate would cap a portion of the state gas tax that rises with wholesale prices.

"Our pockets are being picked by the state of North Carolina by that gas tax variable rate," said Rep. Michael Decker, R-Forsyth County. "That needs to be stopped."

The variable rate is a small portion of the state's 24.5-cent gas tax. It is adjusted twice a year.

The concern is that, with rising wholesale prices, the tax will skyrocket another 3 to 5 cents when it is adjusted again in September.

Some lawmakers want to eliminate that portion of the gas tax altogether. Gas prices would drop 7 cents a gallon.

If the variable rate is eliminated, the state would lose $350 million earmarked for road improvements.

"I'd rather trade off highway maintenance right now for low prices on fuel, and then we'll address the maintenance issue of the highways some other time," said Rep. Louis Pate, R-Wayne County.

The Department of Transportation may have other thoughts on the matter if road projects are going to suffer. But, so far, the department does not have an official position.

In the meantime, bill sponsors said they are getting a lot of positive response. The question is: will the variable tax be capped or eliminated?

"The state can't afford not to give people a break if the prices continue to climb," Lt. Governor Bev Perdue said.

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