Gov. Tom Corbett is ready to give the green light to a proposal that would provide much-needed funds for the state's roads, bridges and public transit agencies. This is welcome news that was too long in coming.
On Thursday, the governor is expected to announce that he wants to eliminate the cap on the state's Oil Company Franchise Tax, a move that eventually could bring in $1.85 billion a year in new revenue. All of the money would be used for transportation improvements, dollars that are desperately needed because of deteriorating bridges, crumbling roadways and crippled mass transit.
Mr. Corbett acknowledged the need to do something significant about transportation early in his administration by appointing a special commission, and the panel gave him its final report in August of 2011. Despite a wide-ranging list of practical recommendations, the revenue-raising items in the plan have lain dormant, with Republicans who control both the state House and Senate unwilling to proceed until the governor, also a Republican, put the power of his office behind specific suggestions.
The wholesale gasoline tax is paid by suppliers who purchase the fuel from oil companies. With the cap in place, they pay the tax on the average wholesale price of gas and diesel, but only up to $1.25 per gallon. The actual wholesale price has been consistently higher for years and averaged $3.114 last year. The current tax paid by wholesalers is $19.2 cents per gallon, and it would jump by 28.5 cents if the cap is removed.
Unknown is how much of the increase would be passed on to consumers, although if all of it were, five years after enactment the average motorist would be paying an estimated $142 more per year.
Mr. Corbett has not yet said whether he would eliminate the cap gradually, and he has not provided other details of his transportation plans, including whether he agrees with the commission's recommendations for increases in licensing and registration fees.
Once he does, the Legislature should put a plan to fix the deplorable condition of Pennsylvania's roads, bridges and transit on a fast track for passage.