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May. 06, 2008
Copyright © Las Vegas Review-Journal

Gasoline tax holiday out of reach in Nevada

By FRANCIS McCABE
REVIEW-JOURNAL

Motorists in three states, including Nevada, might never see the savings of the gasoline tax holiday touted by two presidential candidates.

California, Oklahoma and the Silver State each have enacted laws that would increase their fuel taxes to offset any drop in the federal tax, so motorists in those three states wouldn't see the plan's potential savings at the pump.

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    • Sen. John McCain, R-Ariz., and Sen. Hillary Clinton, D-N.Y., have proposed a temporary halt of the 18.4 cents-per-gallon tax from Memorial Day to Labor Day.

    Nevada law says the state's gasoline tax increase "must be equal to the amount by which the federal tax is reduced." Comparable language appears in Oklahoma and California law.

    Kent Cooper, the Nevada Department of Transportation's assistant director of planning, said the state's law was enacted to ensure funding for construction projects and bond funding if federal money were cut.

    "It was put in place as protection, should the federal program go away," he said.

    Nevada receives about $235 million per year from the U.S. government for road construction projects and maintenance. It wasn't immediately clear how much of this comes from fuel taxes.

    If that money were to dry up, the state would be unable to provide needed services such as repaving, restriping and plowing roads, Cooper said. The state would also have to cancel a number of construction projects already under way, such as the Interstate 15 north widening project, he said.

    Canceling those projects "costs you a whole bunch of money," he said.

    Nevada's law helps ensure that such a situation is avoided.

    Cooper isn't concerned by the plans being floated by McCain and Clinton because both call for replacing the lost fuel tax revenue to the federal highway trust fund -- estimated at about $10 billion -- with other revenue.

    Either way, Cooper said he doesn't believe motorists will see any savings at the pump because neither plan forces oil producers to lower their prices.

    "That seems to make this not a very good proposal," he said.

    A number of national economists have publicly denounced the fuel tax holiday plan, saying the savings would not be passed on to consumers.

    California and Oklahoma officials could not be reached for comment.

    Tennessee has a law similar to Nevada's, but an amendment passed in 2006 suspended the provision until July 1, 2008, said Julie Oaks, a spokeswoman for the Tennessee Department of Transportation.

    Meanwhile, Clinton called for a vote in Congress on a summertime suspension of the federal gasoline tax, the Associated Press reported.

    Jon Summers, a spokesman for Sen. Harry Reid, D-Nev., said the gas tax holiday was not expected to be part of an energy bill introduced this week, but it could come up as an amendment.

    Contact reporter Francis McCabe at fmccabe@reviewjournal.com or 702-387-2904.



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    Dan Wollam wrote on May 09, 2008 02:31 AM: Something of a non-story, don’t you think? It seems Obama is right, and that scares me. For more: http://nevadapoliticsbydan.blogspot.com/


    D. SAVAGE wrote on May 07, 2008 07:19 AM: So, if the feds cut tax on gasoline Nevada, California, and Oklahoma say they will increase state taxes by the same amount.
    That is one of the big things wrong with the economy now - the PolyTickians (many blood suckers) suck our money and then waste it!


    UNLVStud wrote on May 06, 2008 08:57 PM: Obama is right to say this is just pandering of the highest order. The only real relief will come when we stand up and say to Big Oil, "No More!"

    We have to find alternatives and ways to attack Big Oil. It's going to be $4 before you know it and by the end of the year it will be $5.

    Oil needs to loose its tax breaks that were given to it by Porter and the Republicans.

    There needs to be a comprehensive investigation into what Big Oil is doing with its record profits. Obviously they're not using it to the consumers benefit.

    Investments must be made into renewables and into synthetics. Only when Big Oil has a Big competitor will it realize it can't gouge us anymore.


    tim wrote on May 06, 2008 04:04 PM: these clowns even have a tax backup for a tax reduction so taxes never go down.we are screwed.


    curley wrote on May 06, 2008 12:32 PM: herb,clinton,obamba and mcain are for the it.


    David Huntington wrote on May 06, 2008 11:52 AM: 18.4 cents a gallon? Gee, I might save $2.00 for every fillup. Keep it government. You need it more than I do.


    Herb wrote on May 06, 2008 10:56 AM: Who were the politicans that are behind this? If they are still in office today they should be voted out. Everyone blames the oil companies, but taxes are a main reason gas prices are so high. We not only need lower prices, a holiday from all the orange cones would be nice as well.