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Would a gas tax holiday really be worth it?: The Highway Trust Fund would stand to lose billions, and critics say it could lead to even higher prices
(St. Joseph News-Press Via Acquire Media NewsEdge) May 11--A new form of road rage has turned up the heat on local drivers.
One doesn't have to look far for the source of anger. It's spelled out above busy streets in 3-foot type: Gas prices are going up.
Jennifer Whitley saw this coming when she bought a Toyota Corolla three years ago. She considered a sports car with V-8 power, only to opt for the fuel mileage of a four-cylinder.
With an election this November, politicians are quick to craft solutions to the gas price problem.
"They've got to do something," she said. "It's not right when I have to pay over $40 to fill up my little car."
Presidential candidates on both sides of the political spectrum -- presumptive Republican nominee John McCain and Democratic hopeful Hillary Clinton -- want to suspend the 18.4 cent per gallon federal gasoline tax during the summer to help consumers cope with rising gas prices.
Democratic candidate Barack Obama contends that the tax holiday would only help oil companies. His prediction is that consumers would drive more, thus cutting supply and raising prices.
The tax holiday would present problems for some government organizations. The Missouri Department of Transportation, for example, depends on federal fuel taxes for nearly one-third of its budget.
"It's definitely a concern for MoDOT, because the federal fuel tax is far and away the largest source of funding that MoDOT and other state highway departments have," MoDOT spokesman Jeff Briggs said.
Cutting the federal gas tax would cost MoDOT $200 million, Mr. Briggs estimated. Nationally, the Highway Trust Fund would lose $8.5 billion without the federal gas tax. The shortfall would force highway departments to rethink plans to fix bridges and maintain roads.
State legislators don't want to be left out of the tax holiday.
Early this month, the Missouri House gave initial approval to legislation that would lift the state's 17.6 cent per gallon gas tax, which is lower than all but five states. Drivers would pay the tax from May 24 to Sept. 2 but could petition for reimbursement at the end of the summer if they saved all of their receipts.
The measure is part of a larger bill that would phase out the state corporate income tax by 2013. The gas tax portion of the bill would only apply in 2009. Its projected cost to the state is $120 million.
If the federal and state gas taxes both are lifted this summer, MoDOT could face a particularly bumpy road.
"We don't have any specific plans in place," Mr. Briggs said. "We hope it doesn't come to that."
Lucas Hobbs is used to driving over rough roads in his farm truck, a 1989 Chevrolet Silverado. He also has grown accustomed to paying high fuel bills.
"My truck can handle a pothole better than $4 gas," Mr. Hobbs said.
Government intervention has helped stop a fuel crisis before. In 1974, lawmakers found a solution that helped Americans conserve gas without taking money out of highway department pockets when it imposed a nationwide 55 mph speed limit. By the 1990s, gasoline was cheap again and drivers clamored for higher speed limits. Congress removed the nationwide limit on Nov. 28, 1995 -- with oil prices at $18.33 per barrel -- and left states free to set their own speed limits.
Drivers want lower gas prices, but asking them to slow down to save gas is a whole different issue.
"I guess I should slow down," Mr. Hobbs said. "You can't, though, because you'll get run over on the interstate at that speed."
Clinton Thomas can be reached
at clintonthomas@npgco.com.
To see more of the St. Joseph News-Press or to subscribe to the newspaper, go to http://www.stjoenews-press.com/.
Copyright (c) 2008, St. Joseph News-Press, Mo.
Distributed by McClatchy-Tribune Information Services.
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