Haslam reviewing whether 2015 is the ‘right time’ to restructure gas tax

Gov. Bill Haslam said Wednesday that without new transportation money Tennessee must soon decide whether to stop building new roads and bridges and simply stick with maintaining those it already has, reports the Chattanooga TFP.

But the governor told reporters that he hasn’t decided whether 2015 is the year to ask state lawmakers to increase Tennessee’s gas tax — it would be the first one in 25 years — or else pursue new funding mechanisms.

Or he might simply wait.

“There’s no way the state can continue on the path we’re on now. The math just doesn’t work,” Haslam said. “I’m not saying we’re going to ask the Legislature to do it, or they’re going to ask us. We’re evaluating the needs, and is this the right time to do that or not … we obviously don’t want to do that until we have to.”

At the same time, the governor said he is “not going to go put a Band-Aid on it and say, ‘Oh good, maybe we’ll get another three, four years down the road.’ We actually want to look at something that is a strategic long-term view.”

Tennessee’s gas tax — now set at 21.4 cents per gallon — was last raised in 1989. The same goes for the 18.4 cents per gallon diesel tax. The 1.4 cents in both cases goes for inspection fees.

But higher vehicle fuel efficiency standards and increased use of hybrid and electric cars are taking their toll on road funds. They’re not just stalled; they’re going slightly in reverse and the situation will likely grow. While that’s good for the environment, Haslam said, it’s hard on keeping one of the nation’s top five road systems going. Unlike most states, Tennessee funds roads in a pay-as-you-go basis and doesn’t borrow money by issuing bonds.

Haslam’s comments came after Transportation Commissioner John Schroer discussed the situation as agency chiefs this week present their proposed annual spending plans to the governor.

Schroer warned of a transportation funding “gap” with an estimated backlog of $8 billion billion worth of projects.