Washington state drivers could wind up paying $1 per gallon for fuel taxes if lawmakers approve an 18-cent gas tax boost and carbon fees proposed Tuesday by state House Democrats.
The $27 billion, 16-year program would invest more in maintenance than previous statewide packages did. It would fund replacement of fish-blocking road culverts and the electrification of diesel ferries, a top priority for Gov. Jay Inslee.
But the package comes amid the COVID-19 economic slump, while small businesses and laid-off workers suffer financial distress.
“There’s no good time,” said Rep. Jake Fey, D-Tacoma, who chairs the House Transportation Committee.
Fey said a dip in state income poses a risk of cutting road projects. “We knew going into this, that doing nothing was not an option,” he said.
A total 18-cent gas tax increase phased over two years, along with existing state and federal rates, would raise the total to 85.4 cents per gallon, the highest in the U.S. (Diesel would be taxed 3 cents a gallon more.)
A fee of $15 per ton of carbon dioxide emitted, if passed from companies to motorists, might add another 15 cents per gallon. Carbon fees would begin in 2023, escalate to $20 per ton in two years, then $25 two years after that.
Motorists here may see a third increase if the Legislature also adopts a low-carbon fuel standard, to push the industry toward cleaner ingredients such as methanol.
The House Transportation Committee’s top-ranked GOP member, Andrew Barkis of Olympia, opposes a gas-tax increase now. The state should stick to maintenance and finish its projects approved last decade, he said.
“The timing is going to be very difficult,” Barkis said, “because things have just continued to get worse economically as a result of COVID. The governor’s continuing to extend the closures, and we don’t see any relief in the new phases that he’s proposed.”
But Barkis also said late Tuesday his relationship with Fey is good, so he’ll look for areas to compromise.
Tuesday’s House proposal devotes far more money to non-highway purposes than the Forward Washington project lists from Senate Transportation Committee Chair Steve Hobbs, D-Lake Stevens, who in 2019 and 2020 proposed a $16 billion package that focused more on congestion relief.
His project lists include exit lanes at bottlenecks or spending toll income to unclog I-405 at Bothell. Hobbs also is expected to seek $1.5 billion to replace the crowded westbound Highway 2 trestle from Lake Stevens to Everett.
Fey listed only one highway megaproject for funding: $1 billion for Washington state’s share of replacing the old Interstate 5 bridges between Portland and Vancouver. Oregon also is expected to chip in $1 billion, with the rest drawn from tolls and federal infrastructure funds, said Rep. Sharon Wylie, D-Vancouver. The total budget is expected to exceed $3 billion.
Currently, the bridge is envisioned to carry bus transit rather than Portland’s MAX trains — a political third rail that sank a previous I-5 planning effort. Wylie said a new structure should be adaptable to rail use.
Fey said a project list would be negotiated this spring, and the Highway 2 trestle is sure to make the final cut. He also expects a state contribution to the cracked West Seattle Bridge, where traffic is to be restored next year.
The House plan earmarks $4.6 billion for preservation and maintenance, to help reduce a $7.6 billion backlog that drivers feel primarily as potholes and ruts. The previous 2015-16 gas tax boost reserved only $1.4 billion for maintenance.
Gasoline taxes must be spent on highways and local roads, under the state Constitution, but carbon taxes and car-tab fees can be spent elsewhere.
“We have a wide range of strategies to reduce carbon, to cut emissions through alternative fuels, electrification of fleets, trip reduction strategies, with direct targeting to support front-line communities,” Wylie said.
“And we will greatly enhance spending for multimodal purposes including transit, special-needs transportation and our bike and pedestrian program.” she said. “This package takes care of what we have and invests in the future.”
Frontline communities is the new term for lower-income, ethnic neighborhoods that historically were scarred by freeways and endure high pollution. Rep. Bill Ramos, D-Issaquah, said the House package can help reunite such places, like Seattle’s Duwamish River Valley.
Another feature is a lack of debt, emphasized Rep. Vandana Slatter, D-Bellevue. She argued pay-as-you-go will save Washingtonians millions in finance costs.
That could be a drawback to others, like Sen. Mark Mullet, D-Issaquah, who is eager to fund expansions at chokepoints like the I-90/I-405 junction. The state should borrow or refinance now while interest rates are low, he said.
A non-debt package greases the political wheels for majority Democrats, because it needs only 50% approval, instead of the tougher 60% consensus that’s required to sell bonds.