House votes to cap state gas tax

Measure left hanging as Senate adjourns.

bsiceloff@newsobserver.comNovember 29, 2011 

— The House of Representatives voted 96 to 23 Monday night to block a state gas and diesel fuel tax increase scheduled for Jan. 1, holding the tax until July at its current rate of 35 cents a gallon.

But the Senate hit the road without addressing the bill.

A formula in state law has the tax rise or fall every six months with changes in wholesale fuel prices, and state revenue officials have estimated that the tax will climb in January to a record-high 38.8 or 38.9 cents. That would make North Carolina's gas tax higher than all but five other states.

A final House vote is expected today and would have then gone to the Senate. But the Senate decided to adjourn their session at 12:01 a.m., meeting the requirement for the three-day session without addressing either the gas tax or a gambling compact with the Cherokee tribe.

Senate president pro tem Phil Berger said he was concerned that the measure would defer decisions about cutting road projects to the executive branch.

"When gas prices are high, the cost of everything else is high, too," Rep. Bert Jones, a Rockingham County Republican, said during an 80-minute floor debate. "The price of gas and the tax on gas affect just about everything."

The bill was sponsored by Rep. Mitch Gillespie, a McDowell County Republican, who said he had crafted it in a way to provide tax relief while minimizing the impact on state revenues for maintaining roads and bridges.

The tax cap would be in effect for only six months, allowing the rate to rise again next July. If federal highway funding is substantially reduced next year, he said, the legislature will reconsider North Carolina's tax rate during the 2012 session that convenes in May.

The measure also calls for a new study of how North Carolina pays for its transportation needs.

The GOP-controlled legislature voted this summer to increase road-and-bridge spending when it adopted a budget that assumed an average gas tax of 37.5 cents for the current year. After six months at 35 cents, an increase to 40 cents for the second six months would be needed to support the budgeted spending.

State Department of Transportation officials said that keeping the tax at 35 cents instead will reduce state spending enough to cancel plans for replacing 72 bridges and repaving 400 miles of highways.

"So here we're just going to say we're not going to maintain our bridges, we're not going to maintain our roads for the next six months," said Rep. Deborah Ross, a Wake County Democrat opposing the gas tax cap. "So if one of those bridges falls, that's going to be on your watch."

Opponents warned that it would delay popular road projects and cost an estimated 2,800 jobs.

"The gain I see for the taxpayer is going to be minimal," said Rep. Rick Glazier, a Cumberland County Democrat, who opposed the tax cap.

Blocking a 4-cent increase in the gas tax would save the average driver about $30 a year, DOT officials said.

Staff writer John Frank contributed to this report.

Siceloff: 919-829-4527 or or

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