Trucks may bear burden
CARSON CITY — Assembly leaders unveiled a plan Wednesday to slap a tax increase on trucks to raise some of the money needed to relieve highway congestion in Nevada.
Speaker Barbara Buckley proposed the 15 cents-per-mile "weight-distance" tax on trucks as a partial solution to the state’s projected $3.8 billion highway construction shortfall. The proposed levy is part of a package of taxes being looked at by Buckley and other legislative leaders to fund 10 major highway projects over the next eight years.
Buckley, D-Las Vegas, and Assembly Minority Leader Garn Mabey, R-Las Vegas, pledged during a news conference to lead a bipartisan effort to find the revenue for the projects, eight of which are in Clark County, before the Legislature adjourns June 4.
Though Mabey didn’t commit to support the weight-distance tax on the trucking industry — a tax that would raise $1.3 billion over the next eight years — he did say Republicans want a bipartisan solution to the highway construction shortfall.
"I don’t want a repeat of 2003," said Mabey, referring to the bitter partisan fighting and special legislative session during which the Legislature passed a record tax increase.
Buckley said of the tax plan: "There are certain industries that are not going to like this. But I think we will make a million Nevadans happy if they are not stuck in gridlock. I care more about what they think than what industries think."
Senate Majority Leader Bill Raggio, R-Reno, wouldn’t pledge to find a solution to the shortfall this session.
"I am pledged to trying to do something," Raggio said. "We are all aware of the need."
Despite apparent Assembly solidarity, Gov. Jim Gibbons reiterated Wednesday his blanket opposition to any new tax increases — including those to address traffic congestion.
"While I have not yet reviewed the proposals, I welcome innovative and creative transportation funding initiatives to address the challenges created by the tremendous growth of our state," Gibbons said in a statement. "However, I remain steadfast in my opposition to new or increased taxes."
Nonetheless, Buckley, Mabey and Assembly Transportation Chairman Kelvin Atkinson, D-Las Vegas, said the Legislature cannot go home without appropriating funds to reduce gridlock.
"Maybe the Legislature needs to do something the governor may oppose," Mabey said.
Buckley said Raggio, Mabey, Senate Minority Leader Dina Titus, D-Las Vegas, and others have agreed to serve with her on a committee to look at highway tax options. Only gas tax increases won’t be considered, she said.
The chief lobbyist for the trucking industry, Paul Enos, chief executive of the Nevada Motor Transport Association, blasted the weight-distance proposal, calling it "absolutely horrible" for the trucking industry.
Local trucks picking up garbage and hauling cement often weigh more than 55,000 pounds and under Buckley’s plan would be assessed the tax, he said.
It also would be difficult to enforce and costly for consumers, he said.
About 30 percent of trucks have found ways to dodge paying weight-distance taxes in the four states with such taxes, Enos said.
"You would have to rely on self-reporting, or have ports of entry at the 37 entrances and exits to this state," he said.
"It would hit the pocketbook of every single Nevadan. Everything from a new computer to a can of black paint comes on a truck," he said.
Ken Gilman, a manager for Las Vegas-based Neagle Freight Systems Inc., said the trucking industry should bear its share of the tax burden.
"Running (a truck weighing) 80,000 pounds is going to tear up the roads more than cars do, but they shouldn’t bear the full burden," Gilman said. "It’s everybody’s concern."
Ron Lane, a trucker from Montana resting at a North Las Vegas truck stop Wednesday, said a weight-distance tax would hurt truckers trying to make ends meet.
"The freight rates are going to stay the same," he said, meaning brokers will not offer any more money to truckers to haul goods.
Between fuel prices and taxes, "I’m making less money now than I did 20 years ago," the 65-year-old said. "It used to be a good job."
Nevada had a weight-distance tax on trucks until 1989, when it was determined to be unconstitutional because it was levied only on out-of-state trucks.
A hearing to amend Assembly Bill 595 and add the weight-distance tax will be held this afternoon before the Assembly Transportation Committee.
Among the other proposals under consideration by Assembly leaders is a plan to require rental car companies to return to the highway construction fund half of a 4 percent tax they impose on renters. The change would bring in $87 million over the next eight years.
The weight-distance and car rental taxes won’t raise enough to cover the $3.8 billion shortfall, Buckley said. But it would raise about $170 million a year, an amount that Regional Transportation Commission General Manager Jacob Snow testified Tuesday would pay off a $3.8 billion bond over 30 years.
The Nevada Department of Transportation has proposed selling bonds to raise the $3.8 billion and begin working on the highway projects between 2008-15.
The agency estimated $280 million a year in additional revenue would be needed to pay off $3.8 billion in bonds over 20 years.
Less additional revenue would be needed if the Legislature changed the law and allowed 30-year and 40-year bond payoffs, Snow said.
The $3.8 billion would pay for 10 "super" highway projects. Most of them are in Clark County and include several U.S. Highway 95 and Interstate 15 widening projects.
The tax increases proposed last year by a transportation task force formed by then-Gov. Kenny Guinn will be on the table, Buckley said.
Those proposed taxes — placed in Senate Bill 324 — include increasing car registration fees paid by motorists through a reduction in depreciation allowances, tacking $20 onto the cost of driver’s licenses, and placing sales taxes from motor vehicle sales and repairs in the highway construction fund instead of the general fund.
Under a constitutional amendment sponsored by Gibbons, a two-thirds majority of both houses of the Legislature must approve any tax increase.
A two-thirds majority of the Senate and Assembly also would be needed to override a governor’s veto of a highway tax bill.
"We hope it doesn’t come to that," Buckley said. "We want to work with the governor on this package. … There is a growing feeling among the legislators that we need to act."
Review-Journal writers Molly Ball and Francis McCabe contributed to this report.
2007 Nevada LegislaturePROPOSED TAX CHANGES Levying a 15 cents-per-mile weight-distance tax that would raise about $150 million a year. All trucks with a gross weight over 55,000 pounds would be subject to the tax. Placing half of the revenue from the current 4 percent rental car surcharge tax in the state highway construction fund. This would raise about $11 million a year. Redirecting sales tax collected on purchases and repairs of motor vehicles to the state highway construction fund. That revenue, amounting to about $170 million a year, now goes to the state general fund. Increasing by $20 the fee for driver’s licenses, which now cost $10 for four years. The increase would generate about $11 million a year. Adjusting the depreciation schedule used to calculate the annual motor vehicle registration fees, leading to motorists paying about 20 percent more a year. The change would bring an additional $96 million a year. Amending a state law that limits to 20 years the time allowed state government to pay off bonds.
