State has other ways to pay for highways
If you own a 2013 Cadillac CTS sedan in Iowa, it costs you $376 a year to register it. The fee in Wisconsin is $75.
If you own a 2007 Ford Taurus in Iowa, registering it costs $220 a year—almost three times the $75 charged in Wisconsin.
And, in Iowa, the owner of a 2011 Ford 150 pickup pays $220 a year to register it. That’s more than twice the $106 it costs in Wisconsin.
Iowa Department of Transportation official Andrew Lewis explained how registration fees are set there:
“The fees for most autos, pickups and SUVs in Iowa are based on weight and list price. The benefit of this system is that the fees keep up with inflation, which helps to avoid the unpopular vote that a Legislature must take to raise a statutory ‘flat’ fee.”
For vehicles more than 12 model years old, the annual fee is $50.
Why is this relevant?
In the emerging Capitol debate over how to pay for Wisconsin’s transportation future, a panel studying the problem decided to not recommend an Iowa-like registration system.
Ideas the Transportation Finance and Policy Commission considered and rejected are important because the tax-and-fee package it did endorse is the Capitol’s newest pinata. Everybody is taking a swing, trying to destroy it.
The commission’s increases would raise $4.8 billion over the next 10 years.
Transportation Secretary Mark Gottlieb says that money is needed or the state will fall even further behind on rebuilding the Zoo Freeway interchange west of Milwaukee, widening Interstate 39/90 between Madison and Illinois, rebuilding the bridge at Stillwater, Minn., and maintaining roads statewide.
The commission says its recommendations would cost a vehicle owner $120 more per year, or “33 cents per day.”
But, so far, there is no Capitol cheering section for its recommendations:
--A 5-cent increase in the 30.9-cent per gallon gas tax.
--Raising the cost of renewing a driver’s license every eight years from $24 to $44.
--Requiring car and SUV owners to report how many miles they drove the previous year and adding—with some exemptions—a 1.02-cent-per-mile surcharge to the $75 registration fee.
--Eliminating the sales tax exemption for trade-in vehicles.
--Higher registration fees for trucks and commercial vehicles.
Asked why the commission backed some money-raising fees and taxes and rejected others, Craig Thompson, executive director of the Wisconsin Transportation Development Association, said: “We tried to keep our scope focused on user fees, so some other options were really not on the table from the start.”
Thompson and the other 10 panel members didn’t think the owner of a 2007 Ford Taurus would be willing to pay $228 a year to license that vehicle in Wisconsin.
Wisconsin’s $75-per-year licensing fee for cars and SUVs has not been changed since 2008.
Here are other ideas the commission discarded:
--Applying the 5 percent state sales to gasoline prices. Last week, Madison-area gas prices averaged about $3.35 per gallon, according to AAA Wisconsin. Would drivers pay 15 cents per gallon more if the state sales tax was added?
--Weight-based registration fees because heavier vehicles wear out highways quicker. Iowa’s registration system is based on weight and value, as determined by list price.
--Diverting more money from the general fund, state government’s main checkbook, to the Transportation Fund. This year, $137.6 million is going from the general fund to the Transportation Fund, and that amount could be increased over the next two years.
But diverting general-fund cash for highways and bridges leaves less money for public schools, health care, running prisons and aid to the UW System and local governments—the most expensive state programs.
--Installing chip-like devices in vehicles that record miles traveled per year, so bills could be sent to vehicle owners, charging them for in-state miles driven.
The commission rejected this plan for several reasons, including a reluctance to be the first state to use those devices, the high cost of installing them and fears of invading drivers’ privacy.
--Increased long-term borrowing for transportation programs.
But bonding has soared in past years, and debt payments totaled $762 million in the current two-year budget.
If that growth continues, “debt service will consume one-quarter of all state transportation revenues by 2023,” officials warn.
Steven Walters is a senior producer for the nonprofit public affairs channel WisconsinEye. This column reflects his personal perspective. Email email@example.com.