On February 4, 2013 the Governor released his long awaited Transportation Funding Plan. The plan is a political masterpiece and also a good plan for Pennsylvania. Secretary of Transportation Schoch described the details of the plan in a press conference later that afternoon. The plan includes a cut of nearly four cents in the portion of the gas tax which the state controls. This satisfies many in our world who want to cut taxes, cut taxes, cut taxes. The plan also, over the next five years, increases the cap on the tax charged at the wholesale level. Currently the tax is only charged on the first $1.25 of the wholesale price of a gallon of gas. The current wholesale price is about $2.50 a gallon. By charging the tax on the full wholesale price an estimated $1.8 billion dollars per year will be raised. It is not clear how much of the increased tax will be passed through to the consumer by those big nasty oil companies.
While this plan falls far short of the funding identified by the Governor’s Transportation Funding Advisory Commission, it is a step in the right direction which may find enough votes for passage. The Advisory Commission had recommended funding levels slightly higher than this proposal to just maintain the condition of our current roadway system and significantly greater funding to actually improve our system.
Investing in our transportation infrastructure pays dividends both in job creation and by making Pennsylvania more attractive for business. The next step will be for the introduction of legislation in the PA House and Senate to put a funding plan into law. Benchmark will keep abreast of any legislation introduced and we hope that you spend the time to tell your legislators how you feel about funding transportation infrastructure.
Secretary Schoch’s presentation slides can be viewed at the link below.