A new bill proposed by U.S. Rep. Jared Huffman that would create a new federal gas tax that reflects the carbon emissions of the fuel used is gaining attention as Congress struggles to find a way to finance the Highway Trust Fund.
States and cities rely on the Highway Trust Fund, which is supported by the federal gas tax, for money to maintain roads and bridges and to expand transit rail service. Over the years, however, more fuel-efficient cars have resulted in less money going in the trust fund. The gas tax is not indexed for inflation and hasn't gone up since 1993. The trust fund is expected to run out of money by May.
Huffman's Gas Tax Replacement Act of 2015 would replace the 18.4-cent-per-gallon tax on gasoline and 24.4-cent-per-gallon tax on diesel fuels with a tax that would be based on the fuel's "life-cycle assessment of carbon emissions."
That means different sources of crude oil, biofuels and other inputs into gas and diesels would be taxed differently based not just on fuel combustion within the vehicle but also on emission created during the extraction process and production. The Environmental Protection Agency would make the assessments on which the tax would be based. Emissions would initially be taxed at $50 per metric ton of carbon dioxide emissions.
Not putting his eggs all in one basket, Huffman is also supporting a bill by Rep. Earl Blumenauer, an Oregon Democrat, that would phase in a 15-cent hike in the gas tax and provide for future increases based on the annual rate of inflation.
"I'm trying to contribute to a discussion that has to happen in the next few months," said Huffman, a Democrat from San Rafael.
As unlikely as a gas tax increase might seem with a Republican-controlled House and Senate, several Republicans have recently expressed an openness to consider a tax hike. Sen. James Inhofe, R-Oklahoma, who replaced Sen. Barbara Boxer, D-California, as chairman of the Senate's Environment and Public Works Committee, has said a gas tax is "one of the options" for dealing with the trust fund's shortfall.
"There are some more Republicans in the Senate expressing an openness to a gas tax increase," Huffman said.
Sens. Orrin Hatch of Utah and John Thune of South Dakota have said they would consider raising the tax, and GOP Sen. Bob Corker of Tennessee has sponsored a bill to increase the tax.
Dianne Steinhauser, executive director of the Transportation Authority of Marin, said it has been years since states and counties could count on a reliable stream of funding from the Highway Trust Fund.
"It's been a struggle for quite some time," Steinhauser said. Last year, the fund required a last minute, short-term fix to avoid becoming insolvent.
Steinhauser said local projects at particular risk include the Novato Narrows lane addition; a new bridge planned above Sir Francis Drake Boulevard connecting Larkspur Landing and the Ferry Terminal; and work in downtown San Rafael and around the Civic Center to prepare for an extension of the SMART train.
"We're in such dire need on the infrastructure side with both our existing facilities needing maintenance and repair as well as addressing the sea level rise that comes with climate change," Steinhauser said
Responding to Huffman's proposed bill, Marin Republican Party chairman Kevin Krick said, "I do like the fact the Rep. Huffman is looking at the gas tax with a more holistic point of view."
Krick, however, said he had concerns with the plan to have the EPA determine how much tax energy producers would be assessed and the regressive nature of the tax, which he said would affect middle- and lower-income drivers disproportionately. Krick said he prefers a proposal by former Secretary of State George Shultz for a revenue-neutral carbon tax that would be refunded to taxpayers.