PROBLEMS WITH GAS TAX HOLIDAYS
There is more to both the federal and state governments temporarily suspending collection of taxes on gasoline “Obvious gas tax fix may not be best” (Editorial — March 18).
Democratic Sens. Mark Kelly of Arizona and Maggie Hassan of New Hampshire introduced a bill that would temporarily suspend the federal gas tax until the end of 2022. They remind me of cartoon character J. Wellington Wimpy, who famously said: “I’ll gladly pay you Tuesday for a hamburger today.” In this case, it would be a discount for the cost of filling up your gas tank. Tuesday may never come for motorists who have to pay for these proposed goodies.
What neither senator addressed is the result, which would be billions less going into the Highway Trust Fund. This is a critical source of funding for highway and transit projects. A federal gas tax holiday would result in Uncle Sam not collecting 18 cents for every gallon of gas purchased.
The Highway Trust Fund already faced financial difficulties. The loss of billions would have to be made up at a later date. This kicks the can down the road for members of Congress. They will have to decide how to make up the lost billions. They will either raise taxes, transfer revenue from another source or reduce the scope or number of transportation funded projects. Motorists and transit riders will be the losers.
Gov. Kathy Hochul and some members of the state Senate and Assembly are considering supporting legislation that would temporarily suspend the state’s 16 cents-a-gallon tax. This would go into effect from May 1 through the end of the year. In this case, it would be a discount for the cost of filling up your gas tank.
What they all miss is that these taxes raise $2.8 billion per year. They pay for 50 percent of the state’s dedicated Highway and Bridge Trust fund. The MTA counts on these funds for 25 percent of their annual operating budget. MTA Chairman Janno Lieber is correct to express his concern about this proposal as it could result in a loss of $400 million in revenue to his agency.
Other non-MTA transit agencies on Long Island such as Nassau Inter County Express (NICE) Bus, City of Long Beach Bus, Suffolk County Transit Bus and Huntington Area Rapid Transit (HART) Bus would also lose some financial assistance from Albany. This is a critical source of funding for maintaining bridges, highways and transit.
How would the loss of these funds be made up? Hochul, state Sen. Majority Leader Andrew Stewart Cousins and Assembly Speaker Carl Heastie would have to agree on how to make up the lost revenue. They will either raise other taxes, transfer revenue from other sources or reduce the scope or number of bridge, highway and transportation funded projects.
At the end of the day, both motorists and transit riders would be the losers if either the federal or state gasoline taxes are temporarily suspended.
Larry Penner
Great Neck
(Larry Penner — transportation advocate, historian and writer who previously worked for the Federal Transit Administration Region 2 New York Office. This included the development, review, approval and oversight for billions in capital projects and programs for NY MTA, NYC Transit, Long Island Rail Road, Metro North Rail Road MTA Bus, NYC DOT Staten Island Ferry along with 30 other transit agencies in NY & NJ)
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