Road Fund Stabilization Plan Receives Final Passage

March 25th in FRANKFORT—A bill designed to potentially save the state hundreds of millions of dollars in road funds received final passage in the state House tonight.

House Bill 299, sponsored by House Appropriations and Revenue Chairman Rick Rand, would set a 26-cent “floor,” or minimum, for the state gas tax. The gas tax rate is currently 27.5 cents a gallon, but is expected to fall on April 1 without the new floor due to changes in the average wholesale price of gasoline.

HB 299 received final passage in the House by a vote of 67-29. It passed the Senate earlier in the evening on a 29-9 vote. The 26-cent base rate is now in effect as it was signed into law by the governor on March 25, 2015.

The bill was called the “Road Fund stabilization plan” by Rand, D-Bedford. “As we all know, our fuel tax has been in free fall, and this will help us stabilize that by setting a new floor,” he said.

The legislation will allow for an annual—rather than the current quarterly—fuel tax adjustment and will allow the gas tax to rise or fall up to 10 percent per year.

Among those opposing the bill in the House was Rep. Adam Koenig, R-Erlanger, who described the bill as a temporary fix for funding Kentucky’s roads. He said that he will likely file legislation to require a look at new road funding mechanisms for the state.

“It’s my opinion that we need to fund our roads not based upon how much gas you buy but on how many miles you drive,” said Koenig.

Majority Floor Leader Sen. Damon Thayer, R-Georgetown, was one of nine senators who voted against the bill. “I voted on this gas tax floor twice before and both times I was told you will never have to vote on this again,” Thayer said. “When the price goes up, yes, the tax will go up. But when the price goes down, the tax will go down too. That is how it was sold.”

Jared Carpenter, R-Berea, voted for the bill. “We are coming through one of the worst winters in recent history,” he said. “If we don’t provide the money to make sure we can get our roads fixed and taken care of, that’s when you are really going to hear from your constituents,” he said.

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