A plan to take money from the fund to repair roads and bridges and use it to patch part of the state’s budget hole passes in the state Senate, but it includes a plan to raise the gas and diesel tax, something Democrats have vowed to block.
The plan is to borrow about $250 million out of the fund to repair roads and bridges, then impose a $0.06 per gallon tax on gas and diesel.
That would raise about $125 million per year, half of what was borrowed, to be used for roads and bridges.
“So obviously since we’re talking about a motor fuel tax increase that’s a tax increase to all Oklahomans who drive whether it’s regular vehicles or diesel vehicles, correct?” Sen. Kay Floyd, D-Oklahoma County, asked.
“That is an increase on motor vehicle tax which is a user tax, yes,” Sen. Kim David, R-Cherokee County, responded.
Democrats have said they won’t back an increase in the fuel tax unless Republicans back an increase in the tax on oil and natural gas production called the gross production tax.
“Is any of the fuel tax we’re talking about or any of the tax to replace the money that we’re taking out of this fund now, is any of that going to come from an increase in gross production?” Floyd asked.
“This tax that we’re talking about is motor fuel tax on gas and diesel,” David said.
Democrats said Republicans are jumping the gun; spending money the state doesn’t have hoping to pass a fuel tax that may fail.
“Is there any thought to maybe holding off on this bill until we…holding off on spending money until we find out how much money we’re going to be able to raise?” asked Democratic Sen. John Sparks, Minority Leader.
A bill that wraps up the fuel and tobacco taxes into the same plan is expected to be heard Wednesday on the floor of the House of Representatives. It will need several Democratic votes to pass, and all indications are Democrats are not going to cave.