The Importance of HB 617 to New Hampshire
by Todd I. Selig
After lengthy debate on March 6th, the NH House passed HB 617, a bill that increases the road toll, commonly referred to by opponents as the “Gas Tax,” by 4 cents per gallon of gasoline in each of the next three years (fiscal years 2014 – 2016) and then 3 cents in fiscal year 2017, for a total 15-cent increase over the current road toll of 18 cents per gallon. It is referred to as the 4-4-4-3 plan with Rep. David Campbell of Nashua as the prime sponsor.
This additional revenue would be placed in a separate fund within the constitutionally protected highway fund to be used exclusively for the construction, reconstruction, and maintenance of state and municipal roads and bridges – investment that will equate to good jobs across New Hampshire, particularly within the construction, engineering, paving, and aggregate industries.
Projections show the modest change in the road toll would result in increased highway block grant funding for municipalities of $3.6 million in 2014 to over $13 million in 2017 and beyond, for a total increase of $117 million over the next ten years. For communities working diligently to stabilize local tax rates across the granite state, this increase is significant. To put it into concrete terms, the 4-4-4-3 plan would mean an additional $250,962 for Bath; $2,982,522 for Concord; $949,347 for Durham; $980,731 for Exeter; $573,305 for Henniker; $1,656,408 for Keene; $1,140,890 for Laconia; $6,851,848 for Manchester; $5,364,972 for Nashua; $2,079,901 for Rochester; $2,195,307 for Salem; and $112,771 for Woodstock. Local taxpayers in every town and city across NH benefit from the 4-4-4-3 plan.
But much needed additional revenue for municipalities targeted to roadway repairs is not all that this bill provides. The increase would also fund an additional $8.5 million per year for municipal bridge and highway aid programs, fully fund the I-93 widening project, fully fund the state’s grossly underfunded ten year transportation plan, and provide resources to address the 1600+ miles of state roads currently rated in “poor” condition.
The road toll is a true user fee that has not been increased in over 20 years. If the citizens of New Hampshire want decent roads, someone will have to pay for them, and it is only appropriate that the cost be borne by the users. Those who drive less would pay less; those who drive more would pay more.
The House Ways and Means Committee voted on March 20th to recommend reducing the road toll increases from four cents/four cents/four cents/three cents over the next four years, to simply four/four/four. This is a mistake. Full implementation of the 4-4-4-3 plan is reasonable and necessary to meet the state’s transportation needs. Here is why.
At 18 cents per gallon, New Hampshire’s road toll is currently the lowest in New England.
An important aspect of the road toll is that it does not translate penny for penny at the pump. Drive into Maine with a higher gas tax than NH and you can find lower gas prices there. This is because supply and demand is the primary driver of gas prices, not the road toll. When the average driver drives 12,000 miles per year, getting an average of 22.6 mpg, it will cost an additional $79.65 per year after the 15 cents increase is fully implemented. This cost is based on the assumption that the 15 cent increase passes through penny for penny at the pump, which is unlikely.
Even assuming that every penny is passed onto the driver at the pump, the cost of $79.65 is less than what the average NH driver is currently spending on vehicle maintenance and repairs due to poor NH road conditions ($323/year), as reported by TRIP, a national transportation group. And in some areas of the state it is worse. The average driver in the Southern New Hampshire area, including Manchester and Nashua, loses $503 annually due to driving on deteriorated roads, while rough roads cost the average Dover-Rochester-Portsmouth driver $400 annually.
New Hampshire faces an annual transportation funding shortfall of $74 million, more than one third of the state’s major roads are deteriorated, nearly a third of Granite State bridges are in need of repair or replacement, and the state’s rural traffic fatality rate is disproportionately higher than that of other roads in the state. Unless NH can increase transportation investment, conditions are projected to worsen significantly in the future. This serves none of us well and works against the NH advantage.
HB 617, at the 4-4-4-3 level, is a good plan and deserves the support of the NH Legislature. Opposing it is a hard road to travel for our representatives and senators in Concord.
Information about Todd I. Selig: Originally from Laconia, Todd Selig resides with his wife and two daughters in Durham, New Hampshire. He has served as Durham Town Administrator since 2001. After graduating Phi Beta Kappa from Syracuse University, Mr. Selig went on to complete a Master of Public Administration degree from the University of New Hampshire. He has served in a variety of New Hampshire administrative positions within both the municipal and school sectors including positions in Raymond, Laconia, New Boston, Hopkinton, and now Durham. In 2003, Todd Selig was awarded the Caroline Gross Fellowship allowing him to attend the Program for Senior Executives in State and Local Government at Harvard University’s John F. Kennedy School of Government. He was named as one of New Hampshire’s “40 Under Forty” by The Union Leader in 2005. Mr. Selig has previously served as chairman of the board of directors for the New Hampshire Center for Public Policy Studies and as a trustee and vice-chairman of the board of PRIMEX (N.H. Public Risk Management Exchange). He is a member of the International City/County Management Association, a member of the Municipal Management Association of NH, a Trustee Emeritus of the New Hampshire Center for Public Policy Studies, and a member of the Durham Historical Society.