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Proposed gas tax to be used solely for roadwork

Copyright © 2017 Albuquerque Journal

Responding to concerns that money from a proposed 2-cents-a-gallon gas tax would be used for the Albuquerque Rapid Transit project, city councilors on Monday amended the proposal to bar that from happening.

Council President Isaac Benton introduced the floor amendment “to further clarify that this is for roadway rehabilitation.”

The amendment, adopted unanimously, specifies that “no funds (generated from the proposed tax increase) shall be expended for improvements related to or required as a result of the Albuquerque Rapid Transit project.”

ART will transform Central Avenue into a rapid transit corridor with a nine-mile stretch of bus-only lanes and bus stations. The controversial project is scheduled to be completed by the end of this year.

Under the gas tax proposal, motorists who fuel up in Albuquerque would pay an extra 2 cents a gallon. That would generate an estimated $4.8 million a year in new revenue for road repairs and enhancements. The city would be able to use that new revenue to secure significantly more in bond funding for road projects.

The City Council is scheduled to vote June 19 on whether to put the gas tax proposal before voters. If the council signs off on it, the bill will go to Mayor Richard Berry for consideration. If Berry signs the legislation, the proposed increase will be placed on the Oct. 3 ballot.

Albuquerque currently doesn’t impose a gas tax, although it does receive a cut of the state gas tax. The city does impose a quarter-cent gross receipts tax on goods and services to fund transportation projects.

According to Benton’s office, the quarter-cent gross receipts tax has generated $250.4 million for transportation projects since it was enacted in 1999. Of that amount, all but 3.7 percent has been spent or encumbered.

Benton, who is sponsoring the gas tax measure, argues that money generated from the proposed gas tax would help the city greatly with its huge backlog of outdated roadways.

If the mayor signs off on the ordinance and voters approve it, the tax increase will go into effect on July 1, 2018.

Several people at Monday evening’s Council meeting spoke out against it.

Paul Ryan McKenney, a District 9 council candidate, called it a regressive tax that would hurt low-income families.

“I would ask the councilors to think of the poor people who live in their districts and the impact it will have on them,” McKenney said.

Sue Flynt argued that it isn’t fair for the city to ask the public to pay 2 cents more on every gallon of gas when it gives away millions of dollars in tax breaks to developers for their roads.

“You continue to punish the citizens,” she said.

The measure has also garnered opposition from the Rio Grande Foundation, a libertarian-leaning group. The organization launched a website, petition and educational campaign last month aimed at defeating the proposed tax increase. The Rio Grande Foundation helped defeat a proposed soda tax in Santa Fe in May.

“It’s a new regressive tax, meaning it falls heavier on lower-income folks,” foundation president Paul Gessing told councilors. “It may seem like a small tax, but once Bernalillo County’s gross receipts tax (increase) kicks in, the gross receipts tax will be up nearly 30 percent since the year 2000 in our community. The tax burden has grown heavier and heavier over the years.”

He said hundreds have signed a petition in opposition to the gas tax. In response to a question from Benton, Gessing said he’s against voters deciding the gas tax question.

Councilor Pat Davis challenged Gessing on that statement, reminding him that in March he argued that Bernalillo County should allow voters to weigh in on its gross receipts tax increase and that last November he argued that voters should be allowed to vote on ART.

Gessing eventually responded, “I’m against taxes – I’m not going to lie, Councilor Davis.”