Invoking Reagan: Lawmakers push 15 cent gasoline tax hike in lame-duck session

President Reagan believed the gas tax was a true user fee – those who use the road pay for the road. But in today’s world of diverting gasoline taxes to transit and those who aren’t road users, the pay-as-you-go and user fee principles have been all but abandoned. The ‘bait-and-switch’ maneuver in the Blumenauer bill is the push for a vehicle miles traveled (VMT) tax by 2024, when HR 3636 would expire. Invoking Reagan to achieve this back-handed move is, at a minimum, deceitful.


By Terri Hall l December 8, 2014

Something smells fishy when two Democrats gleefully stand in front of a photo of Ronald Reagan to invoke a 15 cent per gallon hike in the federal gasoline tax (currently at 18.4 cents a gallon). The bill, HR 3636, was introduced last year by Oregon Democrat Earl Blumenauer, but it apparently hasn’t gotten much traction. So he and other supporters, Sen. Tom Carper (D- Delaware) and Rep. Tom Petri (R-Wisconsin, whose term is up in January) held a press conference to bring attention to the proposal – this time using Reagan for political cover. Blumenauer filed the bill last year on the exact date – December 3, 2013 and held a press conference, this time with Reagan ‘behind’ him, pushing the tax hike again on December 3, 2014.

While Reagan indeed supported a 5 cent per gallon federal gasoline tax increase back in 1982, with the current state of the federal highway program and wasteful spending on bike lanes, rail, and other transit boondoggles at an all time high, supporting a 15 cent per gallon federal gas tax hike in the current climate without significant assurances that 100% of the gasoline tax will be spent only on highways and bridges is futile, especially given the markedly more conservative Congress that will be seated in 2015. Blumenauer would bring the federal gas tax up to 33.3 cents a gallon and 39.4 cents a gallon for diesel over a three year period.

Reagan believed the gas tax was a true user fee – those who use the road pay for the road. But in today’s world of diverting gasoline taxes to transit and those who aren’t road users, the pay-as-you-go and user fee principles have been all but abandoned. The Blumenauer bill does acknowledge that Congress has dipped into general revenue to keep the Highway Trust Fund solvent since 2009 – to the tune of over $50 billion – so gasoline tax revenues no longer cover the spending for the federal highway program. But what’s behind that spending needs to be scrutinized despite the merits of increasing the fuel tax to keep pace with inflation.

The ‘bait-and-switch’ maneuver in the Blumenauer bill is the push for a vehicle miles traveled (VMT) tax by 2024, when HB 3636 would expire. Invoking Reagan to achieve this back-handed move is, at a minimum, deceitful.

Section 2(b) of the bill states: “Sense of Congress Regarding Replacement of Gas Tax- It is the sense of Congress that by 2024 the gas tax should be repealed and replaced with a more sustainable, stable funding source.”

But Blumenauer has been at it since at least 2009, when he promoted a VMT road tax.

This is hardly the ‘sense of Congress.’ Many conservatives, like Sen. Mike Lee and Rep. Tom Graves prefer to solve the funding shortfall by devolving the federal program back to the states rather than increase the federal gas tax or impose a VMT road tax. Both lawmakers introduced a bill known as the TEA Act  to hand control over to the states last year.

Pro-liberty conservatives like Sen. Rand Paul see a VMT road tax as a big government tracking program with Big Daddy Government written all over it. Other members of Congress have signed no tax pledges with groups like Grover Norquist’s Americans for Tax Reform and wouldn’t be caught dead voting for a gas tax hike.

The bill also imposes a floor stocks tax on diesel or kerosene fuel, which is usually a one-time tax on a fuel in storage (being held for sale) that’s undergoing a tax increase, such as the one Blumenauer wants to impose. The bill would only impose the tax on storage of these fuels over 2,000 gallons.

So one thing is certain, there is no consensus in Congress about the best way to proceed with addressing the chronic shortfall in gasoline tax revenues – the primary source of funding for the Highway Trust Fund – the diversion of gas taxes to non-road uses, or the long-term approach to highway funding. It’s why Congress punted and passed another short-term continuing resolution to keep the last federal highway bill, MAP-21, on auto pilot until next May.


Terri Hall is the founder of Texans Uniting for Reform and Freedom (TURF), which defends against eminent domain abuse and promotes non-toll transportation solutions. She’s a home school mother of nine turned citizen activist. Ms. Hall is also a contributor to SFPPR News & Analysis.