City takes pass on gas proposal

Commission considered asking Legislature to increase tax

It is hard to find many people who champion the idea of higher gasoline prices, but city commissioners briefly toyed with the notion Tuesday night.

City staff members were recommending that the commission include in its list of items that it plans to lobby for at the state Legislature a proposal to increase the amount of gasoline tax the state charges.

The state gasoline tax, which currently is 25 cents per gallon, is a major source of revenue that cities use to maintain streets. But the amount of money collected through the tax has been stagnant or declining as high gasoline prices have people looking for ways to conserve fuel.

“I don’t know if this is the right solution,” City Manager David Corliss said of a tax increase, “but I know it is a major concern for us. We need to have a revenue source that will grow with our costs.”

City commissioners, though, ultimately balked at making a request for a tax increase. Instead, they agreed to soften the language to merely alert legislators that the motor fuel tax was not keeping up with street maintenance costs, which have increased as asphalt and other materials have seen large price increases.

“We’ll leave the solution up to the wisdom of the Legislature,” City Commissioner Boog Highberger said.

The staff proposal for a tax increase did not specify how much the tax should be raised. Instead, it suggested that the tax might need to be changed from an excise tax that charges a certain amount per gallon to a traditional sales tax that charges a percentage of the price. That would ensure that consumers pay more in taxes as the price of gasoline increases.

Commissioners have been struggling with how to fund street maintenance. As part of the 2007 budget, commissioners agreed to spend $5.3 million in street maintenance, up from $4 million in 2006. The city receives about $2.4 million in gasoline tax revenue, with the remainder coming from local sales and property taxes.

But city commissioners did find other taxes that they will lobby the Legislature for. In particular, commissioners will seek:

l Legislation that would allow the city to charge an excise tax to help fund new development. Some communities, such as Overland Park, charge a tax on each new plat that goes through the development process. Those tax revenues then are used to help pay for major streets that will serve the new areas of development.

The Legislature during the last session, however, prohibited cities from creating new excise taxes. Communities that already have an excise tax can keep theirs. Corliss said that would put Lawrence at a competitive disadvantage in funding development compared with Johnson County communities.

l An increase in the mortgage registration tax. The state already charges a tax on each new deed that is filed with a county. The city would like to see that increased by an unspecified amount to provide funding for a housing trust fund that would address affordable housing issues.

l Rejection of bills that propose spending or taxation lids on local governments. Commissioners want legislators to reject efforts to create at Taxpayers Bill of Rights that would limit how much the city could spend or increase taxes.

City Commissioner Mike Rundle said state legislators need to place more trust in local governments.

“The state seems to be overly concerned with looking over the shoulders of local governments on how they spend money or raise revenue,” Rundle said. “They should leave that to local voters who elect or de-elect local leaders.”