Highway funding plan calls for sales tax increase
This article was published June 16, 2010 at 11:37 a.m.
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LITTLE ROCK — The vice-chairman of the Arkansas Highway Commission is proposing a half-cent general sales tax increase as part of a plan to better fund Arkansas' highway system.
R. Madison Murphy, of El Dorado, detailed his proposal Wednesday at a meeting of the Blue Ribbon Committee on Highway Finance, a body created to come up with recommendations for raising at least an additional $200 million each year for highway costs.
Murphy, who also serves on the 18-member committee, said the sales tax could fund a bond program for road projects. His proposal also calls for transferring sales tax collected on new and used vehicles, auto repair parts and services, tires and batteries toward highway costs over a decade.
The plan is forecast to raise more than $3.8 billion in that span and would allow the highway department to make "significant improvements" to roadways across the state, Murphy wrote in a letter to Blue Ribbon chair John Paul Capps.
Murphy said during the meeting the funding option would need to be approved in an election.
"That way no one is foisting a tax increase on the voters of Arkansas that they're not willing to accept," he said.
The Blue Ribbon committee is tasked with finding a solution to large-scale anticipated funding shortfalls. Highway officials project having $4.1 billion available for construction in the next 10 years despite needs totaling $19.1 billion.
Discussion at the meeting Wednesday is ongoing and the body has not reached a consensus on Murphy's proposal or an alternative. Members earlier Wednesday went over previous ideas for increasing funding, including imposing an excise tax on the wholesale cost of fuel and indexing the tax on diesel and gasoline to highway construction costs.
The body must produce a preliminary recommendation by July 1. It meets again on June 23.
Comments on: Highway funding plan calls for sales tax increase
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RBBrittain says... June 16, 2010 at 11:51 a.m.
Strange politics in Arkansas. A Republican (Murphy) wants to RAISE sales taxes--after a Democrat (Gov. Beebe) lowered them on groceries?
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HopeChangeObey says... June 16, 2010 at 12:12 p.m.
NO NO NO....That and this,..."His proposal also calls for transferring sales tax collected on new and used vehicles, auto repair parts and services, tires and batteries toward highway costs over a decade.
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Whereas this will raise the sale tax on every thing, just wait, just wait till after the general election to see a special vote to come of this.
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"That way no one is hoisting a tax increase on the voters of Arkansas that they're not willing to accept," he said. This guy is surly on some hard drugs.
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john1958 says... June 16, 2010 at 12:42 p.m.
The Governor’s academic Challenge Scholarship program is now funded by gambling profits from the lottery. Where are all of the millions of dollars that were used to fund this program? This scholarship program has been around for years. More raise and spend….wake up America at some point “WE THE PEOPLE” must say NO!
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lazybar says... June 16, 2010 at 12:43 p.m.
yes he lowered taxs on groceries but raised the excise tax which meant fayetteville shell lowered production causing drillers to go back to texas or start drilling in pennsylvania.that cost possable jobs and royalties for people of arkansas.get your facts straight about beebe.
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john1958 says... June 16, 2010 at 12:51 p.m.
RBBrittain you mis-read the article, his name is R. Madison Murphy. Not Madison Murphy, R-AR. The lowering of the grocery tax was purely political only to help Beebe get elected. They simply raised taxes in other areas to make up for the shortfall. It's raise and spend here, just like the rest of the country.
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PSMURF58 says... June 16, 2010 at 12:53 p.m.
If they weren't so busy trying to waste money in Conway on the construction of Round Abouts on Harkrider they might have a little extra money to go around. If the tax had a sunset clause that they would stick to then I might consider a small tax increase as our roads have gotten in horrible shape, especially I-40 to and from Memphis. As things usually go in state government they will pass the tax and then scare everyone into leaving it on the books saying if we take this tax off they will have to levy a increase of the gas tax on the already high gas prices we pay right now. By putting a tax on wholesale gas does nothing to the wholesaler as we the consumer end up paying for it in the long run.
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Jjackk says... June 16, 2010 at 1:51 p.m.
I would like the public display of these 19.1 billion dollars worth of projects. Where did they come from? Is it his wish list or what?
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MRPakko says... June 16, 2010 at 1:54 p.m.
Some information about the current level of sales taxes: Arkansas levies a 6% general sales or use tax on consumers, slightly above the national median of 5.85%. Local sales taxes raise the total in most parts of the state. According to the Tax Foundation, combined state and local sales tax collections were $1,727 per person in 2007, ranking Arkansas as the 9th highest nationally.
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KMS says... June 16, 2010 at 2 p.m.
Why not raise the taxes on tractor-trailers as they are supposed to be? Most of the trucks just use Ark. as a through way, it's not as if they are stopping here with goods.
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TwistyDriver says... June 16, 2010 at 2:02 p.m.
As my screen name says, I love to drive the twisty highways in Arkansas either on my motorcycle or in my sports car. Or at least I used to. The roads are in horrible shape in much of my former riding/driving area, due 90%+ from the water trucks and other oversized equipment being hauled by the gas industry. That being said, I am strongly opposed to any additional taxes on anything. The state should divert 100% of the gas/oil severance tax revenue to road repair. If that's not enough, so be it. There's always Missouri.
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CANE74 says... June 16, 2010 at 2:06 p.m.
How about toll booths? No they are not popular, but people that use the road are taxed, not every one will be taxed. This is the 21 century and I think it's about time we start putting our technlogy into other means of travel and not the latest and lamest electronic 'istink' gadget. How about air travel, rail travel, or how about living close to where you work? We can put a man on the moon and spend trillions of dollars tinkering in space but we can't make decent personal aircraft? One other thing, I do not believe this is a republican/democrat issue - cause they're all politicians and they're all going to lie, but the populaton of this country and state are growing especially with illegal immagration, so if population is growing then why are the current taxes being collected not enough? I would not doubt that if this tax were to pass that most everyone in the state highway department would be looking for a raise in salary. If you cann't live on $20 an hour you should maybe try to start leaving within your means. We the PEOPLE have to take and stand. That's my two cents. I am from Conway and there is truth to what PSMURF58 says.
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HopeChangeObey says... June 16, 2010 at 4:32 p.m.
toll booths reads of more of Government expansion. Stay with small government please.
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HopeChangeObey says... June 16, 2010 at 6:29 p.m.
MRPakko you have a point, part of our/this States spending problem is what our/this States like the truck that is used on his farm, plus the a car that the out going land commissar has, then we can look at the Lt. Governor $2000 plus for a Persian rug for his Office! It better be there when the new Lt. Governor gets there.
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arkie says... June 16, 2010 at 9:42 p.m.
The sad fact is that taxes earmarked for road construction and maintenance have been levied for decades. It's not that there is no revenue, it's that the existing revenues that are nominally for roads go into the general fund and are thus misappropriated. Having spent the money in other areas to the detriment of the roads, suddenly the poor road conditions are noticed (by us the taxpayers) and they feel they've gotta levy more taxes. Bottom line - spend less rather than tax more. That and actually spend the revenue that's supposed to go to roads for the intended purpose.
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craig_craigdouglass.com says... June 16, 2010 at 9:45 p.m.
As an attendee at this morning's Blue Ribbon Committee meeting, I feel it necessary to clarify the online story published above. Mr. Murphy simply presented a paper titled, "Possible Options for Generating Additional Revenue for Highways, Roads, and Streets." The paper contained four different funding options, the last of which included a combination of a half-cent general sales tax (to be sunset after no longer than 10 years), a transfer of vehicle-related sales taxes from general revenue to a highway fund (to be phased in over a 10-year period), and a bond program funded by the temporary half-cent general sales tax. The committee discussed this option, along with several others in their day-long session. No recommendations were made, and no definite proposals were considered. This was a discussion only of possible options. Hopefully this clarifies any misinformation or misunderstanding of what occurred in today's committee meeting, and what will continue at next week's meeting of the committee: on-going study and consideration of a wide range of possible options designed to provide a modern, equitable and adequate funding system for our state highways, county roads, city streets and the bridges that connect them.
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HopeChangeObey says... June 16, 2010 at 10:08 p.m.
"craig" UNDERSTAND THIS, WE AS TAX PAYERS ARE SICK AND TIRED OF GOVERNMENT GONE WILD, WASTEFUL, AND NOT LISTENING TO US. IT WILL NOT MATTER HOW ONE PUTS THE PEA UNDER THE SHALL, WHEN GOVERNMENT SHIFTS FUNDS FROM ONE FUND TO UNDER ANOTHER, A TAX INCREASE "WILL" FOLLOW.
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THIS BEFORE ANY OF OBAMA'S NEW TAXES AS VAT, CARBON, AND THE JUST MOST RECENT OBAMACARE. NOT CONSIDERING THE CURRENT AND STILL GROWING NATIONAL DEBT.
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NOW GO FIND YOURSELF THE BIGGEST BAR OF SOAP, AND PACK IT!
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Jjackk says... June 17, 2010 at 10:53 a.m.
Well then build your own roads.
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cckswoop says... June 17, 2010 at 4:30 p.m.
No need to get all glandular and blue veined about it Maddjack. All craig did was report what he saw and heard.
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HopeChangeObey says... June 17, 2010 at 5:15 p.m.
True...the fact still stands, we need no new taxes while this Nation is so red in debt. Maintain the roads that we have of this time as best one can should be the plan.
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jtricer1973 says... June 17, 2010 at 6:33 p.m.
I've lived in Arkansas for 15 years and in all that time all I hear is how the roads need fixing and they implement this tax and that tax to fix the roads, and Arkansas still has the worst highways that I've ever driven on.
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PSMURF58 says... June 18, 2010 at 1:21 a.m.
KMS made a comment about taxing the tractor trailer trucks coming through Arkansas as a solution to the problem. How does that equate? You tax them more and their rates go up so the truck line has to charge the grocery man more money to haul the produce from California to Little Rock, the grocery man has to cover his bottom line as well so he raises his prices to cover his higher costs. Now who ends up paying for this in the long run? You, me and everyone else. I drive a truck for a living and I know how bad some of the roads are in Arkansas as I drive them everyday. I-40 used to be worse than it is now. On the east bound side around the 207 mile marker the road was rutted like an old logging road all the way to the 252. It was easier to drive partially on the shoulder and partially on the road than it was to drive in the right hand lane. Since it is illegal in most states for semi-trucks to operate in the left lane for other than passing it meant a white nuckle ride to Memphis every night. When it rain the rutted road filled with water and it would become even more hazardous than it already was. It has only been 7 or 8 years since a large portion of I-40 was torn up and replaced. Not all of it was fixed at that time so now older sections are falling apart right and left. The main problem that I see with regards to fixing the roads is how the process is bid on and if its the lowest bid they take it. Doesn't the highway dept. have engineers of its own who could go out and figure what the cost might be? It doesn't take a rocket scientist to figure out someone is making a good chunk of money when you go by a construction site and 15 people are standing around laughing and playing grab fanny. Where is the money collected from fuel taxes now being spent? It surely isn't on Arkansas roads or bridges.
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Workingpayingtaxes says... June 18, 2010 at 8:26 a.m.
State and Federal government doesn't have a tax problem, they all suffer from a spending problem. Spend, spend, spend, and when you run low threaten to do away with fire and police protection first to scare everyone into voting for a tax increase. I am personally fed up with this poor government oversight of YOUR and MY money. Both the state and feds need to go back and fund what is Constitutional first and then prioritize from there. Police, fire, schools, roads first and then you can fund the fluff. Unfortunately, fluff is what buys votes.
All Arkansans would be sick if we could get even a half hearted accounting of where OUR money is going.
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HB4 says... June 18, 2010 at 9:48 a.m.
Arkansas tax burden is not that bad....relatively speaking. Yeah, we pay higher sales tax but we have some of the lowest property taxes in the country. Not to mention, we are a relatively poor state (size and average income by tax receipts) so if we are going to add money....we should raise property taxes.
Who's voting for that one?
For those who say we, in Arkansas, have a spending problem...show me where we can cut.
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Workingpayingtaxes says... June 18, 2010 at 10:54 a.m.
First you show me where all the money is going and I'll bet you I can find some things to cut. As was stated above by MRPakko, Arkansas is typically in the top 10 states in tax burden but as HB4 points out we are "a relaively poor state." Hmmm, seems like a good combinatin to me.
How much additional tax are you willing to pay HB4? I already think I pay too much for what I seem to be getting for it. $2000 rugs for the Lt. Governor and $14,000 is gas bills for 22 months of driving for the Land Comissioner. No places to cut you say?
How about the cigarette tax to fund Trauma Centers? Where did most of that money go? Into the General Fund, or the Black Hole would be more accurate a description.
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jreppoh says... June 19, 2010 at 1:27 a.m.
Glad to see that a couple of you remember the highway department needing and getting more money,but as far as I can see they move around so much they rarley finish a job and the rest of the time they just fill the holes and move some place else. Oh and then have to come back and do it all over again. If they would finish a job before they move on I think that would save alot of mney. Money that we don't have anymore. Eitther they use a budget like the rest of us or much more taxes for me and I am going to stop trying and join the other half of the people and get me a hud house and food stamps. Trying to own this over 50 year old house and pay my own way and taxes just is getting to stressfull. What is the point when there is an easier way. FED UP with our stuid goverment. They have 2 sets of rules one for them and one for the rest of us.
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Jjackk says... June 19, 2010 at 1:49 p.m.
Total tax burden by state per GDP:
Arkansas #4 behind Vermont, West Virginia and Hawaii. It is twice as high as Texas and they have pretty good roads. This new tax would put Arkansas closer to the top state.
So I have to go with the "no" here. Looks like the money should be there but its not going to roads or it is getting spent wrong.
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LSS says... June 20, 2010 at 11:49 a.m.
What makes me the saddest is all the road construction going on in the state, yet the schools are in much worse shape, and with AR schools on the bottom of the national list. I could drive on a few bad roads if my kids could get a decent education here.
Toll boths would solve the problem - those who use it the most pay the most. Save the tax increases for the schools. Could never understand why was not some of the stimulus money ear maked for schools??????
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HopeChangeObey says... June 20, 2010 at 9:44 p.m.
"State says no to raises at Ark. agencies, universities."
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News Flash!! !!
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HB4 says... June 21, 2010 at 8:11 a.m.
@ Workingpayingtaxes- I'm with you 100% on the expensive rugs (for someone who doesn't even really do a job) and the excessive expense on gas for a gas guzzler truck...especially one that you keep at your house. (yeah, make me believe that you only drive that to work.
Well, any of you who know rank-and-file, street level, state employed bureaucrats know that they aren't the ones excessively spending. I'd reach out on a limb and say that many of our state employees could make more money working full time at a burger joint
You are also correct about the matter of value. What are we getting for our money? Do we have any non-partisan agencies that perform oversight for our state government?
With that said, I think gasoline is too cheap. We could pay for better roads by an increase of the gas tax. That would also adequately reflect the finite nature of our natural resources. If you use gasoline, you drive a car so....you use the roads.
I would be interested to see what a toll road study would yield.
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HopeChangeObey says... June 21, 2010 at 9:26 a.m.
Toll roads equal more government.
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80Redux says... June 21, 2010 at 10:18 p.m.
PSMURF58's comments not withstanding, Large, Heavy Trucks do most of the damage to the roads, so they should be the ones paying for the repair of the roads. I don't have the statistics, but would be interested to know what percentage of OTR truckers are not picking up or delivering in Arkansas. Again, if they are the ones causing the problem, much like BP in the gulf, they are the ones to pay for the mess.
One other thought. In America we use 11 inches of concrete to build a road. In Germany, the Autobahn is 35 inches thick. Guess what, the autobahn rarely needs to be redone. We should build our primary freeways to last and break the cycle of continuous repairs.
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