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California Legislature

Divided Senate approves gas tax and vehicle fee increases to raise $5.2 billion annually for road repairs

A closeup of one of the potholes on Broadway onramp to the southbound I-5. (Los Angeles Times)
A closeup of one of the potholes on Broadway onramp to the southbound I-5. (Los Angeles Times)

After a week of fierce debate between opposing interests, the state Senate on Thursday approved a proposal to raise gas taxes and vehicle fees by $5.2 billion per year to pay for the repair of California’s pothole-ridden, decaying system of roads, highways and bridges.

The plan was forcefully pushed by Gov. Jerry Brown as a necessary response to 23 years without a gas tax increase, which has resulted in a backlog of $130 billion in repair and replacement projects throughout the state.

The governor and legislative leaders ended up giving nearly $1 billion to specific transportation projects in the districts of legislators who had been on the fence before voting for Senate Bill 1.

State Sen. Jim Beall (D-San Jose) said his bill will fix a crumbling road system and boost the economy. 

"If we are able to have better maintained roads we could prevent accidents and deaths and help have a better outcome in terms of traffic congestion," Beall said during the floor debate. 

Senate President pro Tem Kevin De León (D-Los Angeles),  who negotiated the package with Brown and other Senate leaders, said it is the first gas tax increase in 23 years. Brown and the legislative leaders set a self-imposed deadline for action on the bill by Thursday before the Legislature goes on spring recess.

The bill, which passed the senate on a 27-11 vote, goes to the Assembly for a possible vote today. 

Republican Sen. Anthony Cannella of Ceres voted for the bill and Democratic Sen. Steve Glazer of Orinda voted against it.

Republicans opposed the tax increase, saying the money should instead be taken from a general fund that has swollen by $36 billion in recent years. They also called for diverting non-bond money from Brown’s proposed high-speed train project.

Sen. Jeff Stone (R-Temecula) said the tax hikes will hurt small businesses and low-income families, who he said would have to choose between buying gas or food.

"Are you really going to increase taxes on the families who are struggling in this state every single day?" Stone asked his colleagues.

The legislation, for which final details were unveiled last week, would raise the base excise tax on gasoline by 12 cents per gallon, bringing it to 30 cents. Another variable excise tax would be set at 17 cents.

The excise tax on diesel fuel would jump 20 cents per gallon and the sale tax on diesel would go up four percentage points. Electric cars would pay a $100 annual fee.

The package also creates a new, annual vehicle fee ranging from $25 for cars valued at under $5,000 to $175 for cars worth $60,000 or more.

About $34 billion of the first $52 billion would go to repairing roads, bridges, highways and culverts, with most of the money split 50-50 between state and local projects.

Another $7 billion over the first decade would go to mass transit projects. Other money would fund improvements to trade corridors, including the roads serving the ports of Los Angeles and Long Beach, and would go toward reducing congestion on the most clogged commuter routes.

The bill was opposed by several agricultural industry groups, including the Western Growers’ Assn. and California Farm Bureau Federation, which worried the additional costs of fuel will be a difficult financial burden.

Several environmental groups, including the Coalition for Clean Air, objected to a provision of the bill that they said ties the hands of air quality regulators who might want to adopt new rules to provide for cleaner operations of existing trucks.

The California Chamber of Commerce, cities, counties and labor groups supported the measure.

The Senate also approved a measure for the June 2018 ballot that would prohibit borrowing the new money for non-transportation programs.

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