Updated Feb. 8
A bill to raise the state’s 16.75 cents-a-gallon gas tax by 10 cents over five years advanced the state House on Tuesday.
The plan, passed by a Ways and Means subcommittee, is aimed at improving safety along rural roads and establishing a trust fund, which the state Transportation Department can use solely for improving existing infrastructure.
Each penny would bring in approximately $34 million annually, according to House Majority Leader Gary Simrill. The Rock Hill Republican co-sponsored the bill.
“Smiling faces, beautiful places, crumbling roadways—we don’t want to add that last part,” said Simrill, drawing laughter from the committee.
Provisions of the plan include—
-A $60 fee for drivers of hybrid cars and a $120 fee for drivers of electric cars every two years to compensate for lost revenue resulting from increasing fuel efficiency.
-A $250 fee for drivers from out of state moving to and registering their vehicles in South Carolina. The fee would raise an estimated $20 million annually.
-An increase in the sales tax cap on vehicles from $300 to $500 for vehicles costing $6,000 or more. The bill targets the revenue for the state highway fund under the SCDOT.
-A one-time $87 fee imposed on semi-trailers and trailers. Simrill said the state would collect an estimated $9 million from out-of-state truckers doing business in the state.
Several statewide associations, including the South Carolina Trucking Association, have endorsed the bill.
Improving safety and maintaining existing roads
“This bill is critically important to our highway safety, and it’s long overdue,” said association president, Rick Todd.
The first two cents of the increase is slated for a rural highway safety program under the SCDOT. The agency has said it needs $50 million per year over 10 years for its safety program, which is aimed at reducing deaths and severe injuries on more than 1,900 miles of rural roads.
Phasing in the tax increase lets the agency quickly administer the program, but holds off additional funds it isn’t ready to allocate yet, Simrill said.
The bill also establishes a trust fund under the SCDOT, slated solely for improvements along existing roads.
The goal of the trust fund is to make the roads safer and take care of what we have, Simrill said. “Until we take care of the roads we have, we should not be building new roads.”
“Real” reform revisited
The reform piece of the bill would give the SCDOT the final say over how and when funds are transferred to other transportation agencies within the state.
“We want priorities versus politics to rule the day,” Simrill said.
Small-government activists have called for stronger reforms, saying the reforms under consideration—and those reforms tied to a $2 billion borrowing plan passed last year—aren’t enough.
Last year’s reform let the governor appoint all eight commissioners to the SCDOT Commission, subject to legislative approval. The new law made the commission—instead of the governor—responsible for selecting the secretary.
Activists say the law doesn’t give the governor the needed authority over the agency, leaving in charge the same group of lawmakers as before.
The state chapter of libertarian-leaning Americans for Prosperity urged members to call on lawmakers to oppose the subcommittee-passed bill.
State director, Daniel Brennan issued the following statement on Tuesday—
“While we recognize the great need to improve South Carolina’s roads, it is important to remember that without meaningful reform to the Department of Transportation, tax increases are almost meaningless. A series of tax and fee increases on our roads, vehicles, and gasoline won’t solve the problem alone. South Carolina needs a DOT that is accountable to the citizens as a true cabinet agency. Taxpayers deserve a revenue neutral bill that tackles meaningful tax reform and creates an accountable DOT – not a laundry list of new and increased taxes to send to Columbia in hopes for a better outcome.”
Simrill indicated the group’s opposition wouldn’t stymie the bill’s progress.
Not waiting on federal support
Republican Gov. Henry McMaster on Monday requested $5.18 million to address the state’s infrastructure needs.
In a letter to President Donald Trump, McMaster wrote—
“History shows that South Carolina has given much to the nation, and we intend to give more. But it is too much at this time to ask our people to bear this burden alone, heightening fears of increased gas taxes, delay, missed opportunities and decline.”
Simrill said the funding would be a shot in the arm, but the state shouldn’t wait on it to take action. He indicated McMaster wouldn’t propose a competing plan, but would collaborate with legislators to fund roads.
Republican House members said on Tuesday the governor indicated a gas tax increase should be a last resort, according to a report by The State Newspaper.
The full House Ways and Means Committee is scheduled to consider the bill on Thursday.