Gas tax revenue has been dropping for years. And at the same time the costs for road construction, which the gas tax pays for, are rising. There's a new proposal that seeks to address that, by hiking one fee all car owners pay but offering refunds to them later.
The gas tax brings in $1.9 billion a year. Sen. Bill Coley (R-Cincinnati) is pushing a two pronged approach: raising the annual passenger car registration from $34.50 to $140, and refunding those drivers 28 cents in Ohio taxes for each gallon of gas they buy all year. Registration for trucks would be more, but the cost would be the same to register a big 7 passenger SUV or a small electric passenger car. Coley said a person driving an older less efficient car will like the long term savings. “He could really use the extra – it’s going to cost him a little bit, but saving 28 cents a gallon? That’s going to be a nice thing for him.”
Coley said this will bring in a stable stream of revenue for construction on roads, which all cars use no matter how much gas they require. But regardless of the refund, Phil Cole with the Ohio Association of Community Action Agencies said the upfront cost will be difficult for the low-income Ohioans he works to help. “That’s over a 300% increase in the cost of registering a car. So that’s hard for anybody,” Cole said.
And Cole notes that many poor Ohioans live in rural areas with no public transportation, so he said if they can’t afford to register their cars they could lose their jobs. Coley said the flat fee for car registration wouldn’t be based on income, but he’s not opposed to working out payment plans. And Coley said it’s a better idea than a road use system, which some have criticized because it allows the state to monitor when drivers are on what roads and for how long.