NewsNovember 29, 1998
Motorists pumped $672 million into the coffers of the Missouri Department of Transportation, and city and county governments last year. That's $381 million more than was generated a decade ago, Department of Revenue figures show. The money was generated by the state's 17-cent tax on gasoline and diesel fuel. The Missouri Department of Revenue levies the tax on fuel distributors, who then pass the cost on to service station operators and ultimately the driving public...

Motorists pumped $672 million into the coffers of the Missouri Department of Transportation, and city and county governments last year.

That's $381 million more than was generated a decade ago, Department of Revenue figures show.

The money was generated by the state's 17-cent tax on gasoline and diesel fuel. The Missouri Department of Revenue levies the tax on fuel distributors, who then pass the cost on to service station operators and ultimately the driving public.

Seventy-five percent of the tax revenue has gone to MoDOT. Missouri cities share 15 percent of the revenue and counties split the remaining 10 percent.

Until 1987, the tax was 7 cents a gallon. Since then, tax hikes have increased the gas tax by 10 cents.

Total revenue from the gas tax has exceeded projections made by the state budget office in March 1996. At that time, state officials estimated that the 17-cent-a-gallon tax would generate $544 million a year or $32 million for each penny of tax.

But in fiscal 1997, it beat that estimate by $128 million.

MoDOT has benefited most from the series of tax hikes. The state agency has seen its gas tax revenue grow by $300,000 since fiscal 1987. In fiscal 1998, the department received $464 million from the tax.

G.A. "Pat" Goff, MoDOT's chief financial officer, said the gas tax has been "pretty much on target" with the department's projections.

Goff offered no specific figures as to how much the total revenue for MoDOT was above or below budget expectations in a given year.

But he said the latest series of gas-tax hikes, which totaled 6 cents, generated $17 million more than had been projected between fiscal 1992 and fiscal 1998.

MoDOT had projected that the 6-cent increase to fund a 15-year plan for road and bridge improvements would generate $605 million for the transportation agency over the first seven years of the plan. Instead, it generated $622 million, Goff said.

The Missouri Highways and Transportation Commission earlier this month scrapped its 15-year plan in favor of a five-year plan to fund over 900 specific transportation projects in the state.

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The commission cited flawed funding and an unrealistic timetable for completing projects as reasons for scrapping the original highway plan.

The 6-cent hike in the gas tax, approved by the Legislature to help fund the 15-year plan, remains in place to 2008.

MoDOT's share of gas-tax revenue has increased annually, but by varying amounts. From fiscal 1987 to fiscal 1988, revenue for the state's transportation agency jumped by $87 million thanks to a 4-cent hike in the gas tax.

Gas-tax revenue for the department also jumped in fiscal years 1993, 1995 and 1997 in response to 2-cent tax hikes in each of those years.

But in fiscal 1998, which ended June 30, the department saw its share of gas-tax money increase by only $4 million.

Mike Right, vice president of public affairs for AAA-Missouri auto club in St. Louis, said motor fuel consumption nationwide increases about 2 to 5 percent a year.

"Much of travel is driven by economic conditions in this country," he said. When times are good economically, more people travel, increasing fuel sales.

MoDOT depends heavily on the state motor fuel tax to fund its department. But unlike sales taxes, the gas tax isn't tied to the price of fuel. The tax is levied on the amount of fuel sold.

"Missouri and other states have looked at a sales tax type structure for motor fuel, but there is a lot of opposition to that," Right said.

Taxing fuel consumption still remains "the cleanest way" to fund the state highway department, he said.

Missouri has one of the lowest state gas taxes in the nation, Right said.

Nationwide, the average is 19 cents a gallon. Illinois' fuel consumption tax is at the national average.

Other neighboring states also have higher gas taxes. Arkansas' tax is 18.6 cents a gallon. Iowa charges 20 cents and Nebraska levies a tax of 24.6 cents a gallon.

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