S.C. Gov. Henry McMaster said Wednesday he opposes raising the S.C. gas tax in order to pay for road repairs – rejecting the only proposal lawmakers are considering passing this year.
“Raising taxes is rarely the answer, and it’s not the answer in this case,” McMaster said without identifying where he would find the $1 billion a year state transportation officials say is needed to fix the state’s crumbling roads and bridges and make them safer.
McMaster’s stance marks a shift from last month, when the Richland Republican, who will face a primary challenger next year, said raising the gas tax should be a “last resort.”
It also puts him at odds with lawmakers.
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Last week, the House passed a 10-cent gas tax increase with a veto-proof majority. Earlier Wednesday, a Senate panel approved raising the gas tax to 12 cents.
McMaster offered one place in the state’s roads budget that needs to be reformed.
“The governor believes that the revenue generated by the current gas tax needs to be directed to improving roads and bridges before raising taxes on the people of the state is even considered,” said his spokesman Brian Symmes.
Lawmakers this session have been on track to increase the state’s $16.75 cent-a-gallon gas tax, the second lowest in the nation.
The gas tax now raises roughly $600 million a year, according to the Department of Transportation.
About a third of that money — $167 million — is sent to other entities, including county road committees and the State Infrastructure Bank. Of that, about $45 million is spent on non-road related functions, including the state’s natural resources and agriculture departments.
Meanwhile, $139 million of gas tax money is spent on salaries and benefits for maintenance workers.
S.C. House Minority Leader Todd Rutherford, D-Richland, criticized McMaster’s opposition to raising the gas tax.
"If you’re looking for another revenue source, where you’re not going to find it is where the governor is currently looking," Rutherford said.
It’s unfortunate McMaster is taking a position opposite of a majority of S.C. residents and major S.C. business groups, Rutherford added.
The Senate plan would increase driving fees to raise $800 million a year to repair the state’s crumbling roads.
However, state senators said they expect fights over whether to address two other issues in the road-repair bill — whether to give the governor more control of the state Transportation Department and whether to include any offsetting income tax cuts.
The plan now moves to the full Senate Finance Committee, where more changes could occur.
The Senate panel also stripped out parts of the House proposal that would give the governor more control of the Transportation Department, the state’s roads agency.
State Sen. Tom Davis, R-Beaufort, failed Wednesday to re-insert proposals to give the governor more say over that agency.
Some senators also want to include tax cuts in the plan that would offset the increase in the gas tax.
“There are many of us on the Republican side who really want to fix the roads,” said Senate Majority Leader Shane Massey, R-Edgefield.
But he said those senators are being backed into a corner with an $800 million tax increase, and no offsetting cuts.
State Sen. Greg Hembree, R-Horry, said he supported increasing the gas tax, noting out-of-state drivers would help pay the tax. But he said he only would support a gas-tax hike if it also included tax cuts.
Spending money on road repairs out of the general fund budget — made up of state income and sales taxes — as lawmakers have done for the past few years, punishes S.C. citizens and gives a gift to out-of-state residents, Hembree said.
Cassie Cope: 803-771-8657, @cassielcope
$800 million for S.C. roads?
A panel of state senators approved Wednesday increasing driving fees to raise $800 million for road repairs. In addition to a 12-cent-a-gallon gas-tax increase phased in over six years, drivers would face paying an added:
▪ $25 fee for a 10-year driver’s license
▪ $16 fee every two years to register a vehicle
▪ $60 in fees every two years if they own a hybrid vehicle
▪ $120 in fees every two years if they own an electric vehicle
▪ Up to $200 in added sales taxes if they buy a used car that costs between $6,000 and $10,000. Buyers who purchase vehicles that cost more than $10,000 also would pay an added $200. That tax hike is the result of increasing the cap on the sales tax on vehicle sales to $500 from $300.
▪ A one-time fee of up to $250 if they buy a vehicle out of state and register it in South Carolina