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Texas lawmakers look for ways to fund state’s transportation needs after TxDOT sees $1.9 billion revenue drop

Committee’s interim report explored indexing fuel taxes to inflation rate

SAN ANTONIO – Lawmakers are just beginning the 87th session of the Texas Legislature and they have to craft a budget, all while dealing with declining revenues as a result of the COVID-19 pandemic.

The Texas Department of Transportation has already seen a $1.9 billion drop in revenue during this budget period, and that has some lawmakers looking for more ways to fund the state’s transportation needs.

“I’m not a fan of raising taxes in any form or fashion, but someone’s got to pay for the roads we drive on,” said Representative Terry Canales, D-Edinburg, chairman of the House Committee on Transportation. “And so the fact is the oil and gas industry and those revenues can’t shoulder the ever growing need for infrastructure.”

The committee’s interim report explored possibilities such as indexing fuel taxes to the inflation rate. That’s the method used in 22 states and Washington, D.C., but Texas has not made a change. Fuel taxes here are the lowest among the 10 most populous states and haven’t been adjusted in almost 30 years. One bill on the proposed idea has already been filed.

Canales also believes another source of funding could come from increasing licensing and registration fees for trucking companies.

“Big rigs consume the pavement at 10,000 the rate of a regular vehicle, but they don’t pay that,” Canales said. “They don’t pay within their licensing, the registration fees. They do not pay anywhere, nearly what they consume. So Texas ostensibly subsidizes transportation for big rigs.”

Legislation has also been filed to charge an additional registration fee on electric and hybrid vehicles, which are growing in usage. The bill, filed by State Rep. Ken King of Hemphill County, includes a fee of $200 fee for electric vehicles and $100 fee for hybrids.

“Even hybrids don’t use as much gas, but still travel the same amount of lane, miles and miles that regular vehicles do ostensibly,” Canales said. “And so how do we quantify the amount of saved fuel but less revenue? And so those are questions that are difficult questions, but they need to be answered.”

At the same time, lawmakers must plan for future growth. The state’s population is still projected to double by 2050, so leaders said transportation needs won’t be met by only building new roads.

“Finding the solutions to that could involve carpooling, could involve mass transit, could involve better design, infrastructure, design,” he said. “But at the end of the day, all of those require money.”

The report also examined issues such as regulations for autonomous vehicles and improving safety on roadways in order to reduce traffic deaths.

TxDOT has committed to spending $600 million in the coming years on Vision Zero traffic safety efforts.

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