State Senate set to take first vote today on changing gas tax

By on February 10, 2015

flagasNorth Carolina Senate Republicans introduced a bill Tuesday that would change the way the motor fuels tax is calculated because they say the decline in gas prices will cost the state millions of dollars in lost revenue for road construction.

While representatives for the state’s municipalities and business organizations are behind the bill, the proposal has drawn opposition from both conservative and progressive-leaning groups.

The proposal announced by Senate President Pro Temp Sen. Phil Berger’s office, and approved by two Senate committees just hours later, would dump the system for calculating the gas tax that has been in place for over a quarter century.

Now, the tax is calculated at 7 percent of the average wholesale price of gasoline during the six-month period prior to Jan. 1 and July 1.

The new formula would raise that calculation to 9.9 percent, and set the tax only on Jan. 1 starting in 2016. The measure also cuts the current tax of 37.5 cents to 35 cents, and freezes it at that level.

WRAL-TV reported that reduction would cost the state $33 million, which would be paid for by a mandatory cut of 500 filled and 50 vacant full-time positions at the North Carolina Department of Transportation as well as cuts to road maintenance and other funds.

Under the current system, the gas tax would fall to 30.4 cents on July 1, while the lowest the tax can drop is to 21 cents.

“This balanced plan provides tax relief for all North Carolina drivers while helping ensure the state has the long-term resources necessary to build and maintain safe roadways, bridges and economic corridors,” said Berger, R-Rockingham.

Gas taxes make up nearly 70 percent of the fund to maintain roads and bridges and approximately 60 percent of the state Department of Transportation’s budget, according to Berger’s statement.

The current system for calculating the gas tax has been largely unchanged other than a occasional minor adjustment, such as setting a temporary cap or floor.

Also in the bill is a provision allowing a state income tax deduction for teachers who purchase classroom supplies out of their own pockets.

Sen. Bill Cook, R-Beaufort, said Tuesday night the measure has his full support.

Two groups that normally stand on opposite political sides on many issues were united Tuesday in their opposition to the bill.

“The gas tax portion of this bill appears to be a bait and switch on taxpayers,” said Donald Bryson, North Carolina State Director for Americans for Prosperity. “While it does give an initial cut in the gas tax, it sets a new floor on the tax at 35 cents and thereby keeps the gas tax artificially inflated over time.”

“If Senate Republicans want to pump over a billion dollars in extra taxes out of North Carolina families who are already struggling to make ends meet, they should be upfront about it instead of rushing an intentionally deceptive bait-and-switch proposal through the General Assembly,” said Gerrick Brenner, executive director of Progress North Carolina Action.

A pair of statewide organizations issued calls-to-action by their membership to support the bill.

“These measures, working in concert, will provide much needed stability to transportation revenue in the state while delivering a boost for consumers and the North Carolina economy,” said N.C. League of Municipalities President and Burlington Mayor Ronnie Wall.

“We need to develop a solution that provides a diversified, stable and economically efficient revenue model to meet North Carolina’s long-term transportation needs, in addition to addressing current challenges,” said Gary J. Salamido, vice president for government affairs for the North Carolina Chamber of Commerce.

The full Senate is expected to take up the bill for an initial vote today.


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Principal trade and specialty contractors are solicited for the following Bid Packages:

BP0100: General Trades

BP0105: Final Cleaning

BP0390: Turnkey Concrete

BP0400: Turnkey Masonry

BP0500: Structural Steel & Misc. Steel

BP0740: Roofing

BP0750: Metal Panels

BP0790: Caulking / Caulking

BP0800: Turnkey Doors/Frames/Hardware

BP0840: Glass & Glazing

BP0925: Drywall

BP0960: Resilient Flooring

BP0980: Acoustical Ceilings

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BP1005: Toilet Specialties / Accessories / Division 10

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HUB/MWBE OUTREACH MEETING: Barnhill Building Group will be conducting a HUB/MWBE Informational Session. You are encouraged to attend the following session to learn more about project participation opportunities available to you. These seminars will help to: Learn about project and scope; Inform and train Minority/HUB contractors in preparation for bidding this project; Assist in registration on the State of North Carolina Vendor link; Stimulate opportunities for Networking with other firms. Location and time TBD. Please visit our planroom at for more information.

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