PennDOT Secretary Discusses Lifting Gas Tax Cap to Fund Road Projects

Secretary Barry Schoch spent Wednesday meeting with reporters at PennDOT’s District 11 headquarters in Collier Township to outline Gov. Tom Corbett’s plan to uncap the state’s oil company franchise tax.

PennDOT Secretary Barry Schoch has a blunt assessment about the state’s aging transportation infrastructure and the government’s new plan to upgrade it.

“Every year we duck this issue and every year the bill becomes bigger,” Schoch said. “It doesn’t go away.”

Schoch spent Wednesday afternoon meeting with reporters at PennDOT’s District 11 headquarters in Collier Township to outline Gov. Tom Corbett’s plan to uncap the state’s oil company franchise tax, which would increase the price gasoline, but would bring in billions in new revenue.

“There are a lot of questions of the cost about doing this,” Schoch said. “There’s also a cost if we don’t do anything.”

The cap on tax at the wholesale level would be lifted over five years in unison with a 2-cent cut in the state flat tax. That could add more than a quarter to a gallon of gas, although Schoch said the exact increase would fluctuate and not be completely passed on to consumers.

“If we don’t address the problem it gets more expensive or we face the prospect of closing roads and bridges,” he said.

Lifting the cap would inject $1.8 billion in new annual revenue that could be used to repair unsafe bridges, rebuilt roadways, invest in transit and construct new routes.

Some of the “hundreds of projects” Schoch envisions in the Pittsburgh area include reconstruction of I-376 near the airport and rehabilitating the Birmingham Bridge in Pittsburgh. He added that the state hopes it will be able to complete the Southern Beltway from Route 22 to Interstate 79.

PennDOT plans to launch a website that shows all the projects that would be completed over the next 10 years.

But Schoch said all of these projects would be on the backburner if new funding isn’t found. It’s not known if the state legislature, which must pass the wholesale gas tax increase, has the political will to make the change.

Other changes drivers night see are annual registration for cars would be instead every two years. PennDOT would also discontinue sending registration stickers drivers put on their license plates. A driver’s license would be renewed every six years instead of every four.

The administration’s plan would also look at ways to streamline mass transit by investigating whether merging services between counties or consolidating into regional agencies would be more productive.

“Efficiency and modernization are the hallmarks of what we’re trying to accomplish at the department,” he said.

Roger February 07, 2013 at 03:02 PM
We have already heard outcries about having a $1.00/gallon increase at gas prices a the pump. Yes, it creates hysteria, and discontent with the proposal, but factually, the $1.00 has no basis. The outrage is is another case of the citizens' message: "Please fix our roads and bridges, but don't expect us to pay for it." What is the count on PA bridges are officially labeled structurally deficit, ... 5,000? This has been a problem for many, many years, but politicians had no political guts to address the problem. As time passes, and bridges are either closed to traffic, or severely restricted on usage (e.g. number of lanes, weight limits). Citizens just take it as another ho-hum inconvenience, and move on. Will it take a major catastrophe to bring light to the problem? The proposal to lift the cap should be welcome news to all those who were objecting a year about to "oil and gas companies aren't being taxed enough." People wanting them to "pay their fair share" should be excited to hear the news. For all those who welcome this news of higher taxes upon the industry should also not be surprised by these costs being passed down the consumer. What proposal about taxing businesses more does not have the eventual outcome of the consumer paying more? None. Contrary to what some think, businesses do not have a cache of cash (pun intended) in the back room, set aside, and multiplying every year, for the purposes of paying added taxes.
Roger February 07, 2013 at 03:04 PM
"... objecting a year ..." s/b "objecting a year ago about ..."
Jaun February 07, 2013 at 06:55 PM
Mike Jones (Editor) February 07, 2013 at 08:47 PM
No one wants to pay higher taxes or more for gasoline. But the percentage of taxes in a gallon of gasoline today are at the lowest levels in my lifetime. Consider this, the state fuel tax hasn't been increased since 1997, so it has remained at 32 cents per gallon for the past 15 years. 32 cents of $1.15 per gallon in 1997 = 27.8%. Today, that same 32 cents goes into $3.69 per gallon and equals 8.6%. Meanwhile, the cost of road materials, construction, salt, etc., has increased over the past 15 years while the tax rate has remained stagnant and we're consuming less fuel with more efficient vehicles.
Kathy Lewis February 08, 2013 at 01:40 AM
I agree with the need to repair our roads and bridges along with we all know where the money comes from for these repairs. My problem is every time a "tax" is added to the price of gas, it is always with the promise of the roads and bridges being repaired. If this has been the case, for the increases I have seen since I have been driving, there should be NO POTHOLES in our state, no bridges should be in need of repairs, and you should never see a dead animal along the highways as the "people" responsible for carcass removal should be alerted immediately and the time frame removal deadline should be adhered to or there should be stiff penalties. I drive I79 on a daily basis and am amazed at the number of carcasses left to decay along this stretch. We all know the "trickle down effect" of taxes on anything and know the bottom line is we, the consumer, pay in the end. But if these taxes were truly used for what we are told they are going to be used for, I don't think tax payers would mind, but historically that does not seem to be the case.
Danial Huchko February 08, 2013 at 02:06 AM
Ok, I understand we need to fix our infrastructure, but when does it end? And even when EVERY bridge and road is repaired who's to say they won't lift that tax? Heck I could see them keeping the extra tax on it and putting your hard earned money in their collective pockets. Not stating anything factual just oppinion.
Tracman February 08, 2013 at 02:16 AM
So if we have 5000 bridges that need fixed or replaced but no money to fix them then they should keep building the southern beltway that is nothing but bridges and then have no money to fix them so maybe they should just raise the taxes to $10 a gallon and build more bridges that they can't afford. It's never going to stop until they take everything you have. That tax will not just go to fix bridges but into the general fund where they can use it any way they want. Like automatic pay raises.
Roger February 08, 2013 at 02:19 AM
Kathy, taking what Mike wrote as fact (no reason to doubt), the tax has not been raised in 16 years. So the "every time" situations would have been longer than 16 years ago. How many of these "every time" situations happened before the 16 year mark? What is the history in the last 30 years? Your observations about bridges, dead animals, etc. may be correct, but funding has been stagnant for 16 years. Perhaps we should be amazed at how well roads have been maintained. Your cynicism is understandable. But, if we ride this wagon, nothing is even potentially going to get done. My greatest concern is the revenues collected will not find their way to infrastructure projects. The pattern: The money flows to Harrisburg, and then is directed to other pet projects in various districts. We all know how the "shovel ready" projects went after the $800B stimulus bill passed Congress in 2009. The sales pitch for that money was much about infrastructure. We know it did not happen. My fear is the same would happen with this proposal, not on a Federal level, but a state level. There is clearly a ramp-up period after money starts flowing. Selection, priorities, and engineering work all precede bringing heavy equipment to any bridge project. But, it has to start sometime, someplace, and with some commitment from somebody. I know, I know, ... ribbon cuttings at completed bridge projects don't gain much attention.
Roger February 08, 2013 at 02:22 AM
Bridge repair and maintenance, road repair and maintenance, and other projects like this NEVER end. We only delude ourselves that we can "do it once, then forget it." How do we manage our residential homes? How do we manage our vehicles? Does the PM, replacement, and repair end?
Mike Jones (Editor) February 08, 2013 at 03:34 AM
@Roger... The secretary emphasized that he wants to post on a website every road project that would benefit from this oil franchise tax cap increase. People can be skeptical, but he wants to show people what they're investing in as motorists. This plan is also coupled with plans to make mass transit, bridge design and municipal road designs more efficient. If it's shown things can be done differently for less money, the state will pitch in. If it's shown things can be done for less money and the community decides not to do it, then the state will penalize them. There is a carrot and stick approach to this plan. I wish I could explain this more, but it's very complicated. Ultimately, the current funding is not sufficient to maintain the roads/bridges, let alone repair them or build new highways. I won't advocate for anything, but the public needs to take a serious look at the options on the table.
Roger February 08, 2013 at 11:52 AM
Thanks, Mike. From your description, it does sound like there are more plans as part of the proposal, plans that are intended to insure that projects do happen. I am sure that we can all cite various projects on the books for years before they finally happened, or didn't happen. I think of the McMurray Rd/Center Church project of adding turning lanes and a traffic signal. This was in the pipeline for many years (maybe 6?) before the first piece of equipment showed up. I think of the Rt 19/Valley Brook intersection. Rebuilding this intersection has been under discussion for at least six years, perhaps even eight. Hearings were held regarding rezoning, neighbors fought back and were rejected, specific plans regarding moving roadways were projected, ... yet, nothing has happened. In all fairness, neither of these projects had a structurally deficient bridge involved. Both were safety driven. I would hope that if there is a widespread bridge reconstruction effort, modularity would find its way into the process. Historically, each project starts from the ground up (sorry - bad reference) in terms of design. There are no economies of scale for the structural parts of the project. Each project is piece-meal, leading to much engineering time, and building and/or manufacturing of components. Yes, I realize each site is different, but I remain skeptical of the overall approach to these projects.
412lorie February 09, 2013 at 03:05 AM
How about if we get rid of alot of dead weight in Gov. offices. Put a cap on salary of political offices (if you dont like the pay don't take the job, maybe then they will truly be For The People instead of themselves). Then maybe we would have some extra tax money for repairs that are needed. You can't keep sucking blood out of us. Also maybe when some of this construction isn't done right the contractors should maybe held accountable for their screw ups. I don't mind paying once but if I made mistakes like some of the stuff on the Pa Turnpike it irritates me to no end. You pay good money to drive that road and its the pits. They can do it so it lasts longer than a few years.
Mike Jones (Editor) February 20, 2013 at 02:34 PM
Gas prices just jumped 40 cents in two weeks, and what exactly did we get for that?


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