An average Mississippi family may start shelling out that much more per driver in fuel taxes per year before too long. The stage is being set – artfully – to increase Mississippi’s excise tax by a nickel per gallon. The new total, including the 18.4 cents-per-gallon federal levy, would take the total tax to 42.2 cents on gasoline and 48.2 cents for diesel.
The taxes are per-gallon and don’t vary, as sales taxes do, with the price of the commodity. If a loaf of bread costs $1, the state adds 7 cents. If a loaf of bread is $2, the state adds 14 cents. If a gallon of gas costs $2.50, the state gets 37.2 cents (now) and if a gallon of gas costs $4, the state still gets 37.2 cents.
Building the case for an increase, among others, is Butch Brown, executive director of the Mississippi Department of Transportation. Assisting him in a loosely organized campaign are alliances of contractors. The companies that build bridges and construct, widen or resurface roads need the work and MDOT needs the money to pay them.
It’s not a lot of money, per-driver anyway, goes their argument. It’s only when you add it up – another $120 million from the pockets of Mississippi motorists – that the amount becomes noteworthy.
As was true in making the case for this year’s super-boost in cigarette taxes, Mississippi is now on the low end of states in fuel taxes. Specifically, we’re eighth from the lowest and, even after a nickel increase would be well below the national average of 47 cents.
Mississippi does rank high in per-person fuel consumption, but that’s because we have no large cities with mass transit to dilute the total. It works out that we drive about 16,000 miles per year. At 20 MPG, that’s 800 gallons or so per driver.
We also rank extremely high – inexplicably, absent a belief there’s more than a little cash slipping through the cracks, so to say – in what we pay per mile for road work as compared to other states.
Terrain is different and so are wages, but how does one explain a 1995 report to Congress that in Wisconsin the average wage on federally assisted highway projects was $15.55 per hour, more than twice Mississippi’s $6.69 per hour, yet the total construction cost per mile was $394,405 in Wisconsin and $641,238 in Mississippi?
Costs, not including “slippage,” continue to rise. Arkansas officially estimates it costs more than $100,000 per mile per lane this year for a good overlay job.
MDOT has not made a big, formal pitch to have the tax increased during the 2010 session, which starts in 13 weeks, but it has been making all the right noises. Specifically, MDOT is pointing out that unrepaired roads and bridges are unsafe roads and bridges and that highway maintenance is always a “pay for it now or pay for it later” proposition. Potholes won’t patch themselves. Less formally, it is being pointed out that the Legislature, at least since 2003, has been diverting taxes collected for the statutory purpose of highway work to other purposes. No exact figure could be found, but the total appears to be in the hundreds of millions.
Offsetting that, at least to some degree, has been the $354 million Mississippi has or will receive for highways from the $800 billion federal stimulus legislation.
Brown said a portion of the stimulus money was pegged for pass-through to small cities, leaving more than $289 million for state projects. Brown, often controversial and never shy about money, said MDOT could use about $8 billion. He will become president of the American Association of State Highway and Transportation Officials this month.
Another argument advanced for the tax is that Mississippians, like other drivers, are reducing their fuel usage – meaning less money for MDOT (or less money for the Legislature to “borrow” from what was formerly known as the state Highway Department. Also, the standard, “This tax hasn’t been increased in a long time,” can be heard.
Structurally and in personality terms, there’s a longstanding tug-of-war between individuals in the Legislature who want more say in road projects and the three elected commissioners of MDOT who stress their independence. When it comes down to it, there’s a lot of old-fashioned politicking involved.
There will be intense pressure, due to the recession and high joblessness, to avoid a general tax increase during the 2010 session, but it’s expected that another round of shifting costs, adjusting fees and other “revenue enhancements” will be in play. One of them will likely be another nickel a gallon for gas. If it doesn’t pass next spring, Mississippians can keep their $40 another couple of years. The tax won’t be increased in 2011. That’s a state election year.
Charlie Mitchell is executive editor of The Vicksburg Post. Write to him at Box 821668, Vicksburg, MS 39182, or e-mail firstname.lastname@example.org.