Nebraska senators advance roads funding bill

A coalition of rural lawmakers won first-round approval Wednesday for legislation (LB846) that would create a new gasoline tax formula based on price rather than the amount sold. When combined with a previously approved budget increase for the Nebraska Department of Roads, the bill would result in an estimated 4.5 cent per gallon increase — 1.2 cents on July 1 and 3.3 cents Jan. 1.

The Roads Department budget would be increased by a little more than $30 million. “We have to have more money for roads — that is the purpose of this bill,” said State Sen. Deb Fischer of Valentine, sponsor of LB846. The new tax — a 5% excise tax on the average wholesale price of gasoline — was proposed to shore up Nebraska’s highway construction funds in the face of declining gasoline tax revenue, uncertain federal aid and skyrocketing costs for materials. Gov. Dave Heineman has said he opposes creating a new tax, preferring to first see whether the federal government will provide additional highway funds. But lawmakers rejected his budget proposal to use $15 million in general funds to tide the Roads Department over for one year. Fischer said Wednesday that she would support overriding the governor’s veto of either gas tax increase.

Lawmakers voted 27-12 to give first-round approval to the measure creating the new tax and 27-10 in favor of a second bill, LB 846A, authorizing the Roads Department to spend the $16 million generated in the first five months the new tax takes effect. Rural lawmakers dominated the group backing the increase.