Pumping up the price of gas

Because of tax, unleaded is 12 cents higher, diesel 20 cents


 

California drivers last week started paying higher prices at the pump due to a new fuel tax that will finance the state’s massive new road-repair plan, which is expected to cost taxpayers $5.3 billion and take 10 years to complete.

Residents of Los Angeles County could be on the hook even longer for street repairs and transit improvements because they also have to pay for Measure M, a half-cent sales-tax increase approved last year by voters. With the improvements stretched out over a more than 40-year time frame, there is no end date on the Measure M tax.

The fuel tax increase that all Californians must pay expires in 10 years.

Signed by Gov. Jerry Brown last April and put into effect on Nov. 1, the tax raises the cost of gasoline 12 cents to 30 cents a gallon. Diesel fuel went up 20 cents to 36 cents a gallon.

PAIN AT THE PUMP?—Bonnie Soltman of Agoura Hills keeps an eye on the gas prices at the 76 station on the corner of Canwood Street and Reyes Adobe Road in Agoura. RICHARD GILLARD/Acorn Newspapers

PAIN AT THE PUMP?—Bonnie Soltman of Agoura Hills keeps an eye on the gas prices at the 76 station on the corner of Canwood Street and Reyes Adobe Road in Agoura. RICHARD GILLARD/Acorn Newspapers

Spreading the wealth

Part of the money generated from higher fuel taxes and a simultaneous hike in car-registration fees will be shared with local cities and counties, details of the plan show.

According to funding estimates provided to the office of state Sen. Henry Stern (D-Calabasas), Thousand Oaks could receive $30.3 million over the next 10 years for street repairs. Simi Valley’s share of the new gas-tax revenue is estimated at $29.1 million. Moorpark could be in line for $8.4 million, if Sacramento’s estimates prove correct.

In addition, Calabasas could get $5.5 million from the fuel tax. Agoura Hills could receive $4.85 million over the next decade, and Malibu $2.9 million under the deal. Hidden Hills is in line for $430,000 in new revenues for streets.

Westlake Village’s annual share of road-repair money could jump by $190,000 per year to $1.9 million under the state’s roadrepair and accountability plan.

Overall, the tax will pump an additional $1.4 billion into Los Angeles County transit projects, including street repairs. Ventura County’s Transportation Commission is expected to receive $147 million in the next decade, according to state projections.

Sacramento hasn’t raised the state’s fuel tax on unleaded and diesel since 1994, records show.

Double whammy

Los Angeles County residents already were paying for road repair and transportation improvements in their county under Measure M, which voters approved in November 2016.

The apparent double taxation rankles many, but there’s more to the story, says Jamshid Damooei, chairman of the Department of Economics, Finance and Accounting at Cal Lutheran University.

“It would an overstatement to call this a double tax,” Damooei said.

Although both the new state tax and L.A. County Measure M were created to improve streets, freeways and overpasses, the two taxes aren’t identical.

Measure M’s purpose goes beyond the repair of roads, freeways and infrastructure, Damooei said. It improves public transportation including the conversion of all Metropolitan Transit Authority’s buses to electric. Damooei sees cleaner-running vehicles and more ridesharing options as part of the appeal of Measure M.

A tax measure put on the ballot last November by the Ventura County Transportation Commission proposed projects similar to those under L.A. County’s Measure M. But prodded by opposition from the Ventura County Taxpayers Association and other anti-tax advocates, voters defeated the measure.

Bob Alviani, the taxpayer association president, said his group also campaigned against last week’s hike in the state gas taxes because they weren’t put to the voters.

The need for long-overdue repairs to California’s highways and infrastructure is not a question, Alviani said, “But why try to sell us on a tax that hits the poorest people and the hardest working Californians the most, a tax that no voter ever had a say in passing?”

Other fees

Starting next year, vehicle owners also will pay a new “transportation improvement fee” ranging from $25 to $175, depending on the value of their vehicle. Electric-vehicle owners must pay $100 road improvement add-on for their zero-emissions cars and trucks, but that fee won’t kick in until July 2020.

The state excise tax on gasoline that rose to 30 cents per gallon last Wednesday will keep increasing to 47.3 cents by mid- 2019. The increase is even heftier on diesel fuel and fleet operators, including delivery companies.

The diesel tax at the pump jumped to 36 cents a gallon on Nov. 1. The previous rate was 16 cents. Diesel fuel suppliers were also hit with a tax hike at the wholesale level.

The timing of the fuel-tax hike means motorists won’t enjoy a seasonal drop in pump prices like they have in the past, the Automobile Club of Southern California says. Normally on Nov. 1, drivers are given a winter gasoline blend that costs less. This year, because of the tax, there will be no post- Halloween price drop, said AAA’s Jeffrey Spring.

“We are not expecting that switch to drive down prices this year because taxes on gasoline will also increase by 12 cents a gallon on Nov. 1,” Spring said in a statement.