OUR THOUGHTS ON:

Pennsylvania Passes Transportation Funding Bill

State and Local Tax

By Matthew Dodge

PA Passes Transportation Funding Bill, Schneider Downs CPAsPennsylvania’s Legislature has approved a bill that will increase spending on transportation by $2.3 billion a year by 2018.  The proposal is supported by Governor Tom Corbett, and he is expected to sign the bill.  The additional funds will be used to repair the Commonwealth’s transportation infrastructure, primarily roads and bridges, but also includes grants to mass transit agencies and discretionary transportation-related accounts.

Drivers in Pennsylvania can expect an increase in the cost of driving.  The bill is funded through an increase in gasoline taxes, DMV fees and traffic citation fees.  The cap on the wholesale tax on gasoline will be lifted over the next five years and will result in a total gasoline tax of 59.2 cents by 2018.  The gas tax rate in 2018 will be higher than other states’ current gas tax rates.  Fees for vehicle registrations and drivers’ licenses will be indexed for inflation starting in 2015.  Fines imposed on traffic violations will also increase as part of the revenue-raising effort.

The transportation bill is expected to cost the average driver an additional $22 a year in 2014 and will top out at an additional $132 a year in 2018.  Lawmakers highlighted the bill as an investment and noted that Pennsylvania has not increased its gasoline tax in 15 years.  “I don’t know of a successful business in this country that didn’t invest in themselves at some point in time,” said Senate Appropriations Committee Chairman Jake Corman.  Senator John Wozniak stated, “I don’t think there is any place in the private sector that has not raised their prices in 15 years.”  The bill is expected to create 50,000 jobs and retain another 12,000 according to the governor’s office. 

For more information about the Pennsylvania Transportation Funding bill, please contact Matt Dodge.

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