On February 27, more than 200 advocates for increasing investment in Iowa's transportation infrastructure converged in Des Moines in a winter storm to tell Governor Terry Branstad and Legislators, "It's Time for a Dime." Their mission was to encourage an increase in the state's fuel user fee to generate more revenue for Iowa's transportation infrastructure.

What does a dime cost the consumer?

• Increasing the user fee by 1¢ is less than 10¢ per week or $4.40 a year per vehicle.
• Increasing the user fee by 5¢ would equal $22.00 per year per vehicle.
• Increasing the user fee by 10¢ would equal $44.00 per year per vehicle.

Each week, the added investment in Iowa's transportation infrastructure from a 10¢ per gallon increase in the fuel user fee would cost less than one can of your favorite soda, half the price of a cup of gourmet coffee ($1.85 for a large cup of Starbuck's coffee), and a fraction of the cost of one movie ticket.

Every 1¢ increase in the user fee generates $23 million to be spent on Iowa transportation infrastructure!

These are Constitutionally protected funds for roads and bridges and 20 percent of the payers are from out-of-state.

Average miles driven per household vehicle is 12,100 miles per year. Average passenger vehicle (2004 and newer) is required by federal law (Corporate Average Fuel Economy) to obtain 27.5 miles per gallon. Average passenger vehicles consume 440 gallons per year or 8.5 gallons per week.

What does a dime do for Iowa transportation infrastructure? It will generate $230 million annually which covers the critical needs shortfall of maintenance projects identified by the Iowa Department of Transportation.

Increasing the fuel user fee also gives Iowa the ability to generate revenue from out-of-state drivers using our roads, highways, and bridges. The mechanism for collecting the fee is already in place. And those who use the roads more, truly do pay their fair share.

The last time the fuel user fee was raised in Iowa was 1989. Governor Branstad was in office during his first tenure. The national average price for gasoline was $.98 and median household income in Iowa was $26,229. Today, the national average price for a gallon of gasoline is $3.78 and median household income in Iowa is $52,451.

If the fuel user fee had been indexed in 1989, it would look very different today.

Information provided by Iowa Department of Transportation.

The debate over generating more revenue for Iowa's roads, highways, bridges, and associated transportation infrastructure will continue this session. Let your Legislator know you support an increase in the fuel user fee.

Alternative #3: Bonding and Tolls

Tolling is a revenue source designed to finance bonds for highway construction or improvements. Bonding is not a prudent practice for highway maintenance projects. New corridors will not see sufficient toll revenues to support bond payments. Iowa's current grid system will allow traffic to avoid toll roads making the toll collection infrastructure irrelevant.  Debt service for highway construction is not in the long-term interests of Iowa.

Alternative #4: Raise Other Vehicle Fees

In 2008, numerous registration fees were raised to begin a funding commitment to TIME 21.  Because gas taxes were not raised at the same time, registration fees now outpace gas taxes in revenues to the Road Use Tax Fund. This ratio is reverse of what is should be.

Alternative #5: Replace Gas Tax with Vehicle Miles Traveled Tax

While this embraces a user fee concept, the United States is decades away from fully integrating every American vehicle with the technology to determine the appropriate tax or uniform collection. This approach will require large payments at a time for users, while the current tax system allows for periodic small payments (taxes) over the same time. We cannot wait decades for such a change to take place. Our infrastructure needs attention now.

Alternative #6: Doing Nothing

Not an option for Iowa's future.

Raising the Fuel User Fee: The Better and Fairer Approach

Why?

    1.  User Fee Concept

    2.  Gas taxes and motor vehicle fees are the only funds collected by

         state government that are constitutionally protected to go for the 

         purposes in which collected, "construction, maintenance and 

         supervision of the public highways."

    3.  Supports Iowa's "pay as you go" construction philosophy.

    4.  Tax is easily collected and paid over time.

    5.  Gas taxes are also paid by out-of-state drivers (20 percent of

  traffic) who use our system.

    6.  Has the least adverse economic impact on users over time 

         compared to tolls, fees, etc.

This information is courtesy of:

• Associated General Contractors of Iowa (founded 1923)
• Iowa Good Roads Association (founded 1946)
• Iowa Motor Truck Association (founded 1942)