Rep. Schultz: Updating Utah’s Gas Tax Formula

This past month, Rep. Mike Schultz, House Committee Transportation Chair, gave an exclusive recap of the top transportation bills of the 2017 legislative session to the Salt Lake Chamber’s Utah Transportation Coalition. Rep. Schultz discussed how the Utah Transportation Coalition played a central role in these issues and gave a behind the scenes look into the legislative process behind these policies.

Updating Utah’s Gas Tax Formula

The Utah Transportation Coalition made its mark on transportation policy with the passage of H.B. 362-Transportation Infrastructure Funding Amendments in 2015. However, shortly after passage of that bill, gas prices plummeted, impacting the indexing component of the legislation.

“We had originally projected that the growth component would begin in 2019,” said Michael Parker, Chamber Vice President of Public Policy. “Instead, we were looking at 2026 or beyond. That completely undermined our efforts to stop the impact of inflation.”

S.B. 276, carried by Rep. Schultz, updated the underlying formula behind Utah’s gas tax to match the current economic conditions and the intent of the 2015 H.B. 362.

“The Utah Transportation Coalition was critical to the successful passage of S.B. 276 ,” said Schultz. “In the final days of the session, Abby and Michael were able to speak with almost every member of the House of Representatives and work with our leadership team to get this passed.”

A critical component of the bill sought to provide a budgetary mechanism to alleviate pressure on the general fund from transportation earmarks.

“In 1997, 95 percent of our road funding came from the gas tax,” said Rep. Schultz. “Now, that portion is down to 50 percent.”

As such, the bill also begins the process of reducing overall transportation-related sales tax earmarks by 35 percent of the new fuel tax revenues to ensure users bear the primary responsibility for funding Utah’s infrastructure.

“As this is all unplanned revenue for the state, it will not impact any long-term planning in the Unified Transportation Plan,” said Abby Osborne, executive director of the Coalition and Chamber Vice President of Government Relations. “This bill brings us back in alignment with our projections in 2015 and is the right thing to do for the overall budget.”

The Utah Transportation Coalition is a group of business and civic leaders working together to protect Utah’s environment, improve the economy and preserve our quality of life through strategic transportation investments. The Coalition is an established, long-term organization advocating specifically for responsible transportation investment to keep Utah’s economy moving.

By | 2017-04-11T15:01:44+00:00 April 12th, 2017|Blog, Infrastructure and Transportation, Policy|0 Comments

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