Proposed road use tax draws opposition

by Leo Wolfson

Cody Enterprise

Via Wyoming News Exchange

CODY — State Legislators are considering a new tax assessed on Wyoming drivers as a way to raise funds for the Wyoming Department of Transportation.

If passed, House Bill 37 would levy fees on all Wyoming residents operating a motor vehicle in the state through a road usage charge. The charge would come at a per-mile rate depending on the type of vehicle being driven.

As new vehicles become more and more fuel efficient, Wyoming’s fuel tax generates less and less money per year for the WYDOT. The usage charge is being promoted as a stable funding source that allows for a “sunset” to the fuel tax.

“We all do the same kind of damage to the road so this is kind of a way of leveling the playing field,” said Rep. Sandy Newsome (R-Cody).

Passenger cars and trucks would be charged about 2 cents per mile with escalating fees based on the size of the vehicle, culminating at 14 cents per mile for multi-axle trucks.

For the average Wyoming resident who drives 21,821 miles per year, according to a report from driving education firm I Drive Safely, their usage fee would be about $436 annually.

WYDOT Director Luke Reiner compared government mileage tracking to a municipality reading a home utility meter and said this could take place through a variety of different methods ranging from “technical” means such as using a GPS or “black box” tracking device that would be required to be placed in all Wyoming motor vehicles, to more manual derivatives as simple as having the user send in a photo of their odometer.

Reiner, who helped craft the bill, said the organization is facing a $354 million annual budget deficit. WYDOT has reported 34% of Wyoming’s roads are either in poor or mediocre condition, while 47% of Wyoming’s bridges and 76% of Wyoming’s interstate bridges are more than 50 years old, numbers Reiner said are increasing every year. Meanwhile, construction costs are only increasing with inflation, as fuel tax revenue dwindles.

“It’s a tax of diminishing returns,” he said.

HB 37 would raise $123 million per year for WYDOT. Reiner said about 5-6% or $6-8 million of revenue would go toward covering operating costs of the department.

Despite the state’s having around $1.3 billion in reserves, WYDOT receives no funding from the general budget. Rather, it is dependent on state and federal fuel taxes, driver registration fees, and a small portion of mineral royalties to support its needs.

Costs and criticism

The bill has drawn many opponents who point to its limitations, such as there being no way of calculating off-road travel.

“How do you turn it off when you go to the mountains?” Wapiti resident Scott Weber questioned. “When you’re hunting the box is still recording.”

Weber said the bill would also cause the cost of household goods and construction materials to rise and violates what he views to be three core Republican Party tenets: raising no new taxes, reducing government bureaucracy and overreach. He said the Park County voters’ rejection of a fifth penny tax this fall should serve an indication as to how the local Representatives and Senators should vote on this bill.

“It’s very, very invasive,” he said. “What they need to be doing as good lawmakers is making cuts. WYDOT is not a sacred cow.”

Weber has criticized Newsome, who voted to support advancing the bill out of the joint transportation, highways & military affairs committee.

In a phone interview Tuesday, Newsome defended her vote as a way to“start a conversation” about keeping roads fixed and repaired in light of WYDOT’s declining revenue sources, but added she “probably” would not vote to pass the bill in its current form in the House, and finds the bill having a “slim to none” chance of becoming law.

She said the bill also lacks serious provisions to account for out-of-state travel performed by residents.

“They would be paying their (other states) fuel tax in addition to our road usage rates,” she said.

Her biggest concern with the law is the government surveillance that would occur through tracking citizen’s yearly driving mileage.

“I’m not a big fan of a tracker or black box in your car,” she said. “It’s a little ‘big brother.’”

Rep. Dan Laursen (R-Powell) is opposed to the entire bill and said WYDOT needs to make cuts in line with the rest of the state’s government budget cuts.

“I don’t want the government trying to decide how many miles I decide to drive,” he said.

Laursen said although WYDOT did permanently close 10 rest stops in June, amounting to $789,812 in annual savings, he would like to see much more aggressive measures considering WYDOT operated a $678 million budget in 2020.

Decline and diversify

The bill is an example of an effort by certain members of the Wyoming State Legislature to diversify revenue sources.

Under the bill’s current verbiage the tax would go into effect in March 2022 but Reiner said he would amenable to having this delayed a year especially if it meant undergoing a voluntary trial period to work out all the kinks.

Laursen said he believes the road usage charge is being used as a ploy to distract attention away from HB 26, a bill proposing an increase to the current fuel tax by nine cents per gallon.

“I believe it’s a tactic to make it more palatable,” he said.

If the rate charge passes, Reiner said HB 37 would replace the fuel tax for all Wyoming residents, but that tax would still be assessed upon out-of-state travelers. In-state residents would be reimbursed for their fuel tax charges based on how many miles they were tracked travelling during a year.

Discussions about implementing road use charges have occurred in other states as well, as have regional usage tax discussions. Newsome said there have also been chats about raising transportation revenues through an Interstate 80 toll road tax.

Reiner said some major amendments are being considered for the bill and he would support changes as long as they provide WYDOT with a more consistent and increased revenue source.

“It’s our eventual goal to make a transition to a new funding source – these are the early steps,” he said.