Will $4 Gas Prices Sink Campaign to Keep Gas Tax Increase?

Will $4 Gas Prices Sink Campaign to Keep Gas Tax Increase?

Gov. Jerry Brown’s administration and many Sacramento are working overtime to try and convince California voters to reject an effort to repeal last year’s very controversial $52 billion gas and car tax increase. 

The measure, which is nearly certain to make the November 2018 ballot, is favored for passage in most statewide polls.  A November Los Angeles Times poll found that 54 percent of registered voters favored its repeal.  A more recent PPIC survey found that voters were mixed on the question, though support is likely to rise as voters receive their higher DMV registration renewal bills. 

As part of their campaign to convince Californians to keep the gas tax in place, Caltrans is fast-tracking funding from the higher gas tax for highly-visible road projects around the state.  So far, they’ve spent $118 million of the $503 million in new revenue collected. 

According to the Times, this has gone to fast track the resurfacing of 23 miles of Interstate 605 in Los Angeles County, 72 miles of Interstate 40 and US 95 in San Bernardino County, 23 miles of State Routes 1 and 39 in Orange County, and other similar projects. 

The strategy is politically smart – focus on funding highly-visible road improvement projects in areas with lots of voters to hopefully influence their votes in November. 

But as Caltrans’ “Go Fast” strategy continues, another external factor threatens to sink the whole effort. 

GasBuddy.com – the online fuel price tracking service – has released its latest forecast for California in the months ahead and it’s not a good one. 

They are projecting gas prices of $4 per gallon to return to California’s pumps by spring.  A temporary refinery shutdown for maintenance or less production from OPEC could push prices higher. 

Traditionally, sharply-rising gas prices have been met with calls for gas tax cuts from politicians looking to avoid a voter revolt.  In the past, there have been proposals to cut the gas tax altogether or repeal California’s awkward “double taxation” on gasoline, or the sales tax being applied to the total of the purchase price plus the excise tax. 

California’s gas price problem will surely be made worse this year by our 12 cents per gallon higher gas taxes. 

If the gas tax is repealed this November, anger over high gas prices will surely be a top factor.  Given this political uncertainty, one can only wonder if those same elected officials and bureaucrats who pushed the new gas tax might wish they had a do-over.  Had they agreed to the many other transportation funding solutions proposed last year that didn’t rely on higher taxes, they wouldn’t be holding their breaths today waiting for the verdict of voters in November. 

Tim Anaya is communications director for the Pacific Research Institute.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.