By Jason Stuart
Ranger-Review Staff Writer
The future of Dawson Community College dominated the discussion in last Friday’s public meeting with the Glendive area’s two local legislators, but the proposed elimination of state funding to the college wasn’t the only issue on local residents’ minds.
With state revenues down and some legislators proposing deep cuts to other sectors besides education, including spending on the state’s highways and infrastructure, some of those present at the meeting pressed Rep. Alan Doane and Sen. Steve Hinebauch on their willingness to consider ideas for raising the state’s revenue so those proposed cuts wouldn’t have to be as deep or painful.
However, both Doane and Hinebauch expressed in their statements a reticence to consider any option which would include raising taxes on anything, despite that the tax revenue the state generates for some areas — like highway funding — is failing to keep up with the rate of inflation and is leaving the state unable to fully maximize the matching funding available from the federal government.
“When I went to Helena, I didn’t have a bunch of people saying, ‘Hey, go raise my taxes,’” Doane said.
Mike Newton pressed Doane and Hinebauch on the issue of raising the state’s gas tax. The state gas tax funds the Montana Department of Transportation and is the primary source of funding for the state’s roads, highways and bridges, as well as the Montana Highway Patrol.
But the state’s gas tax has not been adjusted in over 20 years, falling behind the rate of inflation and leading to declining revenues from it. Deep cuts have been proposed by Gov. Steve Bullock to MDT and the MHP for the next biennium. The declining revenue the gas tax generates also means that the state has been unable in recent years to fully leverage the federal highway funding made available to it.
“Considering we haven’t had a gas tax increase since 1993, you should probably take a look at it,” Newton said, adding his opinion that hiking the gas tax would be one of the few ways to squeeze some more funding for the state out of the millions of tourists who visit each year. Newton noted that with no state sales tax, gas taxes and lodging taxes are the only way the state currently has to generate tax revenue from its booming tourism industry.
Doane, however, said he already voted in the House Transportation Committee against a bill — HB 473 — to raise the state’s gas tax by 8 cents per gallon. The state’s current gas tax is 27 cents a gallon, which has, as noted, gone unchanged since the increase made by the 1993 Legislature took effect in 1994.
Doane said he was concerned about what an 8-cent gas tax hike would mean for the state.
“It’s an 8-cent gas tax hike for the state of Montana, and I think that would put us 11th in the nation for gas tax,” he said.
The city of Glendive is full-bore behind HB 473.
According to city Director of Operations Kevin Dorwart, Glendive receives approximately $103,000 per year in gas tax returned to it. That money is the city’s sole source of regular funding to maintain, repair and construct city streets. With the 8-cent gas tax raise proposed in HB 473 and changes which would distribute more of the collected tax back to local municipal and county governments, Dorwart said the city would stand to gain an additional $143,000 per year on top of what it is currently getting.
“It would help a lot with our streets,” Dorwart said.
He also pointed to analysis which shows that a good deal of that additional 8-cent gas tax would be collected from non-residents, echoing Newton’s comments about how the state currently gets little tax money out of all the tourists visiting it.
“The beauty of it is 40 percent of that tax would come from out-of-state, from tourists,” Dorwart said.
Dorwart noted his data comes from the Montana Infrastructure Coalition, of which the city of Glendive is a full, voting member.
During last Friday’s meeting, Doane though he expressed opposition to the bill appeared to leave a little room for consideration of a lower gas tax increase.
“I’m going to have a hard time voting for the gas tax in its present form, but maybe we could find a compromise,” he said.
Doane added that one feature of HB 473 that he did like is the proposal to give more of the collected tax back to the local governments. Local government officials have long complained that Helena keeps too much of the tax for itself and does not send enough back to the local communities.
Hinebauch did not specifically say he was against the gas tax increase, but his comments belied his personal belief that the state government has enough revenue as it is and that he would look for even more ways to cut state spending if possible.
“I went down there vowing to make government smaller, and that’s what I did, and that’s what I want to do,” Hinebauch said. “The state budget right now is at $5 billion, and it’s a little bit overwhelming to me that the biggest industry in the state (agriculture) generates just about what the state spends on its budget, so it’s obvious to me that we’ve got too much government.”
Hinebauch did suggest he would be open to pulling money out of the state’s Coal Tax Trust Fund to shore up some of the state’s current revenue shortfalls. However, he also noted that doing so is politically unlikely, given it would “take a big vote” (meaning two-thirds of both houses of the Legislature) and the support of Bullock to do so.
Reach Jason Stuart at rrreporter@rangerreview.com.