DES MOINES — Gov. Terry Branstad reiterated his support for a “pay as you go” solution to the state’s road funding shortfall Monday.
But the governor wouldn’t go as far as endorsing one or more of the tax or fee increases listed on an Iowa Department of Transportation memo that’s been circulating among select lobbyists and lawmakers for at least a week.
The memo, a copy of which was obtained by Quad-City Times Des Moines bureau, has not been released publicly.
“This is a whole series of different options,” Branstad said Monday when asked by reporters about the memo during a news conference. “I’m not endorsing any options.”
The state has an estimated $215 million-a-year backlog in what IDOT terms “critical” infrastructure needs.
Efforts to increase the state’s fuel tax by up to a dime a gallon have fallen short in the past two legislative sessions. The governor then requested a series of options to raise revenue for the road fund as an alternative to a straight fuel tax increase.
Some of the options on the IDOT list are:
- Increase the fee for new registration from 5 percent to 6 percent. Estimated to bring in $60 million a year.
- Apply state excise sales tax on dyed fuel sales, which are used in farm vehicles and not currently taxed for state road fund purposes. Estimated to bring in $38 million a year.
- Increase oversize/overweight vehicle permit fees. Estimated to bring in $10 million a year.
- Eliminate the state per-gallon fuel tax and replace with a state excise sales tax on fuel that would bring a 6 percent sales tax on a wholesale level. Estimated to bring in $467 million between 2015 and 2025.
“My hope is that we can look at all these different options and alternatives and see if a consensus can be built that would eventually gain bipartisan support in the Legislature — both the House and the Senate — to address the issue of funding for the road use tax fund,” Branstad said.