What is being proposed?
City Manager Tim Gleason has proposed adding a tax of five cents per gallon on unleaded gasoline and one cent per gallon on diesel fuel. This would apply to both retail and bulk sales. Money from the tax, estimated at $300,000 per penny, would be allocated for road repairs. Some council members have also asked for a sunset provision, which would end the tax after a period of time unless a future council extended it.
When will they decide?
Mayor Julie Moore Wolfe said it’s likely that an ordinance would come before the Decatur City Council at its next meeting on Tuesday, Feb. 16.
Why tax diesel less?
The state motor fuel tax for diesel, 21.5 cents per gallon, is 2.5 cents higher than the 19 cents per gallon on unleaded gas. Gleason said the city was taking the different into account when proposing a lower amount for the the local diesel tax.
Doesn’t the city already get motor fuel tax money from the state to do road repairs?
Yes. But the city is getting less of it as people drive more efficient cars and Decatur’s population declines. Also, because the city’s financial position hasn’t been great, some of that motor fuel tax money has been used to buy salt. Last year, the city got about $1.8 million total in state motor fuel tax.
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Didn’t the city used to do road work regularly?
Yes. Before the recession, the city spent about $4 million every year on street projects. In 2009, financial pressures led the city to take about $2 million that had been set aside for capital projects and put it toward higher pension costs and other general fund needs. For every year that the city can’t do as many repairs, the roads get worse and cost more to fix. Also, the price of asphalt doubled between 2005 and 2013.
How do we know they will use this money for roads?
Gleason has said he wants to create a special line item in the budget for this money, and use a website to track projects that it funds. Also, every project that costs more than $20,000 will come before the council for a vote.
Won’t this just cause people to buy their gas elsewhere?
Maybe. Gleason said the city has talked to other communities about what happened when they added a local motor fuel tax (and many other Central Illinois cities have). "Part of our research and even past research that staff has done shows that - and this is not an absolute - but shows that surrounding communities around a community that has adopted a local motor fuel tax, you will in fact see a dip," Gleason told the council. "But generally, that recovers at six to nine months, and those outlying communities will adopt the same pricing as the community that adopted the local motor fuel tax."
Haven’t they been talking about this forever?
Basically. There were specific study sessions devoted to a gas tax in June 2014 and February and March 2015, and it has come up several times during discussions of city finances over the past four years or so. Gas is a very sensitive purchase. It's not an easy vote. Council members have expressed frustration and reluctance every time they talk about it, even as they acknowledge the necessity of good roads for safety, quality of life and economic development reasons.