CONCORD, N.H. -- A proposed 4 cent increase in New Hampshire’s tax on gasoline and diesel would provide much-needed money to fix deteriorating roads and help finish the expansion of Interstate 93, supporters testified Tuesday.
But opponents told the House Ways and Means and Public Works and Highways committees that the Senate-passed bill would cost consumers and truckers at the pump and lead to higher prices on goods and services.
The bill would increase funding for highway improvements for two years, then earmark about half the proceeds to pay off $200 million in borrowing to finish the Interstate 93 expansion.
Once the debt is paid off in roughly 20 years, the tax increase would expire. The bill also would eliminate the Exit 12 ramp toll booths in Merrimack.
The House passed a 10-year highway plan that outlines a way to help pay the remaining $50 million needed to finish the I-93 expansion and proposes borrowing money to replace the Sarah Mildred Long Bridge between Portsmouth and Kittery, Maine.
The bridge includes a rail connection to the Portsmouth Naval Shipyard that is used to carry nuclear waste. Lawmakers believe the bridge’s replacement would give the two states more leverage should another round of base closings include the shipyard as a potential candidate for closure.
The tax bill is a compromise between the two chambers over highway funding. Last year, the Senate killed a House gas tax proposal and the House rejected a Senate casino bill that earmarked some profits for highway improvements.
New Hampshire hasn’t raised its gas tax since 1991.
Sen. Jim Rausch, the tax bill’s prime sponsor, told the committee he wasn’t sure if his measure would survive changes by the House. A Republican from Derry, Rausch said it was not easy getting the Republican-controlled Senate to agree to a tax increase.
Rausch estimated that New Hampshire’s 18 cent tax represented 16 percent of the average price of a gallon of gas in 1991 and now represents only about 6 percent of the price of a gallon.
"This partially restores lost purchasing power. I don’t view this as an increase," Rausch said.
He estimated that someone driving 10,000 miles per year getting 25 mpg would pay $16 more in a year if the tax is increased 4 cents.
Matthew Murphy, executive director of Citizens for a Strong New Hampshire, said Rausch’s estimates are much lower than what the typical consumer would pay.
"Ten thousand miles a year is an unrealistic number for anyone commuting to work or using (a vehicle) for commercial purposes," he said.
Greg Moore, state director for Americans for Prosperity, said lawmakers instead should increase the highway funds going to the Department of Transportation that are diverted to other agencies.
"This bill does nothing to curb the abuse of using the highway fund as a slush fund for other agencies," he said.
That prompted a rebuttal from Assistant Safety Commissioner Earl Sweeney in defense of the Department of Safety’s use of about one-quarter of the highway fund to support its budget.
The constitution allows using highway funds to maintain public safety on the roads, he said.