HARRISBURG – Gov. Tom Corbett’s administration has joined talks on transportation funding proposals and is showing interest in legislation that would increase a tax paid by gas-station owners to pump more money into highway and bridge construction and repair, a top state senator told The Associated Press on Friday.
Senate Transportation Committee Chairman John Rafferty, R-Montgomery, said he hopes to introduce a bill in January that will include input from key Republicans and Democrats in the House and Senate, as well as the governor.
Talks with Corbett aides began in the last two weeks, Rafferty said.
“They’ve shown interest in some of the language that I’ve proposed to them in lifting the oil company franchise tax,” Rafferty said. “They haven’t nodded their head in agreement, but they’re very interested what I’ve proposed.”
Corbett, who took a campaign pledge not to raise taxes, has been under pressure from lawmakers since last year to come forward with a transportation funding plan to address a multibillion-dollar backlog of highway and bridge repairs that are a source of rising safety concerns.
The per-gallon tax is applied up to an average wholesale price of $1.25, and lifting the statutory cap could produce well over $1 billion a year.
Another cornerstone of Rafferty’s legislation would involve offering incentives to encourage private-sector investors to underwrite for-profit transportation projects, such as tolled highway lanes. Borrowing against the higher expected tax collections from lifting the cap to speed up construction could be a part of his plan, as well, Rafferty said.
A spokesman for the Republican governor confirmed Friday that the governor’s aides have participated in the talks. The spokesman, Kevin Harley, also pointed to comments by the governor Thursday that he hopes to make an administration plan public by early February, when he is scheduled to issue a budget proposal for the 2013-14 fiscal year.
“Whatever we do, we’re going to be working closely with Sen. Rafferty,” Harley said.
Corbett told reporters Thursday that he is considering the idea, which was also recommended last year by his hand-picked commission to study ways to boost transportation funding.
Senate Minority Leader Jay Costa, D-Allegheny, said Friday that Democrats could support a transportation funding bill that includes lifting the cap on the oil company franchise tax, as long as they have meaningful input on the legislation and their concerns over funding for mass transit and railroads are addressed along with highways and bridges.
Lifting the cap on the oil company franchise tax has been discussed for years, but lawmakers have shied away from it because of arguments that it is a tax increase that would be passed down to consumers at the pump. Still, leaders of Pennsylvania’s business advocacy groups – among Corbett’s biggest backers – support the idea of raising taxes or fees to improve roads and bridges.
Rafferty said he is exploring a legal way to prevent fuel distributors from passing down the cost of the tax to consumers at the pump.
Lifting the cap in stages over a five-year period would provide almost $1.4 billion in additional revenue in the fifth year, the commission said last year. The Pennsylvania Department of Transportation is currently on track to spend $5.3 billion this fiscal year on highways, bridges and mass transit, the agency said. The total includes federal money.