FOR IMMEDIATE RELEASE 11/10/2020
Representative Lopez Files the Two Cents for Texas Act looking to Modernize Texas' Motor Fuels Tax
San Antonio, TX – Monday, November 9th, State Representative Ray Lopez of House District 125 with the support of leaders in the fields of transportation, labor, commerce and construction filed HB 207.
Continuing the work he started in the 86th legislative session, HB 207 or The Two Cents for Texas Act - would increase the current motor fuels tax by two cents and index it to the consumer price index, allowing the tax rate to keep pace with the rate of rising costs of highway construction and add long term stability. This fixed rate was established in 1991 and has never been modified causing a substantial decrease in purchasing power due to inflation in the nearly 30 years since.
"The existing motor fuels tax has left infrastructure expansion projects at a precarious impasse and Texans are tired of being forced to pay high costs to use tolls roads or waste hours sitting in traffic on congested highways” said Representative Lopez. “Transportation reports indicate that our stressed and decaying infrastructure system is not meeting the high demand. It's time Texas joined other oil driven states in modernizing our motor fuels tax rate which would provide funds to maintain the safety and quality of Texas' highways, roads and bridges. More importantly, it would reduce the need for borrowing, which Texas has increasingly turned to as a means of financing transportation improvements. Texans could help slow a growing trend of using the “credit card” to pay for roadway projects by putting in their two cents and indexing the state motor fuels tax to a modern metric."
If passed, HB 207 is projected to generate over $2.5 Billion in the first five years with revenue being appropriated to fund transportation costs and Texas schools. Today the breakdown of the current motor fuels tax is: 15 cents or 75% goes to the State Highway Fund while five cents or 25% goes to the Available School Fund. In a time where Texas is healing from an almost $5 Billion deficit due to the Covid-19 pandemic and looking for ways to maintain the promises we made to educators all over Texas last session, HB 207 will raise more than $625 million for education in Texas in the first 5 years.
This adjustment will hardly be felt at the pump and it does not target the lowest income demographic who generally use public transportation alternatives. If anything, the added money to the transportation fund would help public transportation initiative all over the state. In the first five years of implementation, The Two Cent for Texas Act will have an average incremental rate increase of 0.027 cents per gallon of fuel or be about .40 cents more to a 15-gallon tank of gas. Well below what Texans already spend on toll roads across our state today. Additionally, with oil prices being the lowest they have been in years, the time is right for a modernization of the motor fuels tax in Texas.
"In the shadows of the economic downturn due to Covid-19 we must find quick and trustworthy ways to revamp our economy and transportation projects are known to enhance the economic vitality of the state by providing thousands of jobs and adding revenue to local communities. Completed transportation projects enhance the state's long-term economic competitiveness and infrastructure improvements projects will be essential to meet the needs of the pandemic as it will be a major contributor to our economic recovery," said Representative Lopez.