During the past 40 years, I've been involved in numerous pieces of tax legislation, including stints as the chief tax policy advisor to two governors. In some instances, I have supported legislation. In other instances I have been on the opposing side. But in all of those years I can't recall any single tax proposal that was more ill-advised than one currently being discussed in the Idaho Legislature to provide money from the state general fund for road and bridge maintenance.

The state general fund is primarily made up of revenues from the sales and income taxes, plus some other miscellaneous sources. It is the major source of state funding for public schools, higher education, Health and Welfare, corrections and other general government programs.

Historically, state highway funding has come from sources that are dedicated to that purpose. Primarily the state motor fuels tax and vehicle registration fees. And those sources are protected by the state constitution from being used for any other purposes.

During our most recent recession, when state financial support for public schools and higher education was actually being reduced, state highway revenues could have afforded a quick fix to that problem. However, in the 1940s, the voters of Idaho made, in my mind, a wise decision to protect dedicated highway revenues from diversions to other purposes.

But now, 75 years later, with state and federal highway revenues stuck in a rut, the idea is being proposed to begin using a portion of the revenues from the state sales and income taxes to fund highway needs.

The proposal would transfer $150 million a year for use in maintaining highways and bridges. This is roughly the amount that the University of Idaho or Boise State University individually receive from the general fund each year.

This proposal comes at a time when Idaho's percentage of the state budget going to education - especially higher education - has been in steady decline. Much of the reason for that has been the steady increase in meeting the funding needs of the departments of Correction and Health and Welfare.

This proposal would add highway funding to the list of programs competing with education for money from the state general fund. It is ironic that for some legislators it is apparently acceptable to fund higher education with increased user fees (i.e. tuition) but not do the same with highways.

There is no doubt that there are growing unmet needs for state and local highway funding in Idaho, just as there are for education. But there already exist funding sources that are dedicated to highways and protected by the constitution from being diverted to meet other needs such as education.

The problem is reluctance by the Congress and the Idaho Legislature to address those needs by increasing taxes on motor fuels.

The Idaho motor fuels tax hasn't been increased since 1996 and the federal tax hasn't been increased since 1993.

The state tax is currently at 25 cents per gallon. In recent times, the cost of gasoline has fluctuated that much in a single month. If it were increased by the 8 cents that one legislator has proposed, the impact on consumers would be miniscule compared to the fluctuations they has seen at the pump caused simply by prices set by the petroleum suppliers.

During the past five years, gas prices have always fluctuated by at least 75-cents a gallon during the year - and in 2010 and 2015 have fluctuated by as much as $1.60 a gallon.

So the addition of 8 cents to the state tax to help meet the needs for maintaining our state and local roads system would not be particularly devastating to most Idahoans.

But to meet those highway funding needs at the potential expense of education and other essential state services could prove devastating because once highway's nose is in the tent, the push will begin for greater amounts of money from that source each year.

And if they are successful in obtaining general fund support for highways, then it will probably only be a matter of time before supporters of Idaho Fish and Game determine that getting into the general fund is preferable to increasing hunting and fishing license fees.

Hopefully wiser heads will prevail and this highway funding proposal will go nowhere.


Peterson is a native of the Lewiston-Clarkston valley. He is retired and lives in Boise.


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