Arkansas: Panel faces tough road to highway improvements

[phantom power]

As it stands, the message is: Arkansas can’t make its road-building ends meet with some $900 million in annual revenue from state and federal motor fuel taxes. State Highway Director Dan Flowers says the state needs $200 million a year more just to maintain its highways at current levels.

To supplement road funds, the highway committee is endorsing three options — shifting $425 million a year from state general revenues; indexing fuel taxes based on the annual Construction Cost Index increase, which is a general measure of inflation associated with construction commodities; and levying an excise tax on the wholesale price of motor fuel.

Gov. Mike Beebe, who spearheaded successful efforts to increase the state severance tax on natural gas operators to aid road construction in 2008 and raise state tobacco taxes last year to fund health programs, bluntly opposes tapping general revenue for highway construction. He also questions raising fuel taxes in the current economy.

“It’s one of those tough deals. Everybody knows we need more money for highways, but we don’t have any realistic opportunity to shift general revenue, and I’m not for that,“ the governor said. “It would be tough for me or the Legislature to support tax increases, right now when we’re in such a tough economic situation for our people.”

http://www.maumellemonitor.com/articles/2010/01/24/jacksonville_patriot/local_news/nws08.txt