Pennsylvania transportation plan costs hard to figure
The big question being asked Wednesday about Gov. Tom Corbett's transportation funding plan was how much it would cost consumers at the gasoline pump.
The answer from the Corbett administration: We don't know, and probably won't ever know.
The plan would increase the taxes paid by gasoline wholesalers by lifting an artificial cap that currently limits taxation to the first $1.25 per gallon of the wholesale price. But gasoline prices are driven by far greater forces than taxes, and there will be no way to tell precisely what impact lifting the cap will have, Transportation Secretary Barry Schoch said at a briefing in Pittsburgh.
The tax on wholesalers "does not directly correlate at the pump," he said.
The cap would be removed in three steps, the first occurring in July and the others in 2015 and 2017. The impact of the first step on wholesalers is fairly easy to compute, because the wholesale price on which the tax is based -- currently $3.114 per gallon -- will remain fixed through the end of the year, under state Revenue Department regulations. Removing a third of the cap July 1 would add 9.6 cents of tax per gallon on wholesalers. What is unclear is how much of that would be passed along at the pump.
At the same time, Mr. Corbett's proposal calls for 1-cent reductions in the gasoline taxes paid directly by motorists, on July 1 this year and next. Factoring that in, if wholesalers passed along all of their added costs, the net effect for a typical driver (12,000 miles in a 24-mpg vehicle) in the first year would be $43 in added expense.
With no way of knowing where wholesale prices will go in 2015 and 2017, estimating the impact of Mr. Corbett's plan on gas prices in those years becomes a wild guess.
Mr. Schoch said citizens should consider that not raising additional revenue for transportation also will cost them -- in worse roads, bridges that must be closed or weight-restricted and increased traffic congestion, all of which will drive up the cost of consumer goods transported in the state. The increased spending proposed by the governor would create an estimated 50,000 jobs, he said, while 12,000 jobs would be lost if no action is taken.
Mr. Schoch said the Pennsylvania Department of Transportation will post a detailed list by late March of the projects that would move forward if Mr. Corbett's plan is approved by the Legislature. It calls for $510 million in additional spending on transportation in the first year and $1.8 billion by year five.
"If I'm asking to raise money, you deserve to know what I'm doing with it," he said.
PennDOT currently has 4,500 structurally deficient bridges, 600 posted with weight limits and 50 that are closed altogether, Mr. Schoch said. "We simply cannot continue to avoid this problem without implications for public safety," he said.
First-year funding in Mr. Corbett's plan would add $300 million for state highways and bridges, $80 million for local roads and bridges; $60 million to a multimodal fund that includes airports, railroads and trails; $40 million to public transit; and $30 million for Pennsylvania Turnpike expansion projects.
Although the transit share appears low, Mr. Schoch said the state remains committed to funding the Port Authority at levels that will enable it to maintain existing service. The authority and transit agencies statewide would have to come up with additional local matching funds and would be required to consider consolidation with other agencies in their regions if the governor's proposal is approved.
First Published February 7, 2013 12:00 am