Editorial: Not ideal, but it’s best time to talk about gas tax

With only one year left on Illinois’ current construction program, a coalition of business and labor groups is trying to get discussion started about what to do when it ends.

In many ways, the timing for such a discussion could not be worse, but unfortunately there will not be a better opportunity any time soon, and it’s a discussion that must be had.

The crux of the Transportation for Illinois Coalition message is that without a new construction program, Illinois’ transportation system, the lifeline for the state’s prosperity, will deteriorate rapidly, further battering the state’s economy, costing thousands of jobs and delaying necessary work that will only cost much more to complete later. The group’s legislative prescription is a major revision in the way gas taxes are collected for state transportation projects, supplemented by increases in various driver’s license and registration fees.

With pensions, budgeting and a simmering debate over income taxes already on their legislative plate, Illinoisans understandably may be wearying of talk about financial crises, but fortunately, this situation is not yet an emergency. Its potential solutions do demand attention, though, and serious reflection, for the coalition is right to warn of the foolishness of letting the construction program dissolve and its proposals carry serious consequences for motorists in Illinois.

The easy part of this debate is the question of changing the way gas taxes are collected. A system based on a percentage of the wholesale price of gasoline makes more sense than the current fixed figure per gallon, which cannot naturally follow the trends in inflation and the economy as a whole.

For example, when the present 19 cents-a-gallon motor fuel tax was implemented in 1990, gasoline in Illinois cost about $1.50 a gallon. Since then, labor and materials costs have increased markedly as have the needs for construction and upkeep of Illinois roads, but sales of gasoline have not kept up. Indeed, under such a system, the only way to produce a revenue stream for roadwork that ebbs and flows with the economy is to sell more gasoline, a prospect fraught with numerous drawbacks.

Basing the fee on a percentage of the price of a gallon of gas offers a better alternative. The question is, what should that figure be? The coalition wants 9.5 percent. That’s not an unreasonable a place to start discussion, but it is for many reasons an uncomfortable one. Yes, when the present gas fee was implemented in 1990, the 19 cents represented nearly 13 percent of the then-common $1.50 retail cost of a gallon of gas, and 23 years later, it’s less than 5 percent. But the coalition estimates that a 9.5 percent tax on the wholesale gas price would add about 13 cents to the retail cost of a gallon of gas today. In a time of continuing economic hardship, it’s hard to generate interest in adding to people’s burdens.

We must remember, of course, that Illinois’ transportation assets are critical to the state’s economic vitality and that fixing them later rather than maintaining them now could add even more to those burdens. The coalition plan would generate $800 million a year to stave off such a prospect. Is that the best number to work with? It’s worth a discussion, and, bad timing or no, one that needs to get under way.