Lawmaker proposes a ‘holiday’ from gas tax

05/11/2006

Prospects of passage considered slim

BY PATRICK SWEENEY
Pioneer Press

Motorists would get a 20-cents-a-gallon break on gasoline prices for six months under legislation advocated by four House Republicans.

“Minnesotans, as everyone knows, are getting squeezed at the gas pump,” Rep. Paul Kohls said Tuesday during a news conference to promote the bill, which was introduced in the House last week.

Under the bill, the state would temporarily stop collecting the current 20-cent tax on gasoline during a gas-tax “holiday” that would stretch from July 1 to the end of the year. During that time, about $317 million that is now held in a “tax relief account” would be used to pay for the highway construction and maintenance normally covered by the gas tax.

Kohls, the chief author of the tax holiday bill, said the legislation currently has no mechanism to guarantee the 20 cents a gallon in tax relief would be passed on to motorists buying gasoline. He said he would amend the bill to provide that guarantee before he would allow a House floor vote on the measure.

But the gas-tax-holiday proposal is so loaded with conditions that it might not, and probably will not, become law.

“It’s late in the session,” Senate Majority Dean Johnson, DFL-Willmar. “It’s a headline-grabber, but probably not going to happen.”

The plan is conditioned on House members — who already voted to provide about $317 million in property-tax rebates and income-tax relief for married couples — changing their minds and voting to provide the gas-tax relief instead.

Like the property-tax rebates and income-tax cuts for married people, the gas-tax relief also would be contingent on the state Supreme Court upholding a 75-cents-a-pack cigarette fee that lawmakers and Gov. Tim Pawlenty enacted last summer.

There is another obstacle to the gas-tax holiday becoming law: Both the Democratic majority in the Senate and Pawlenty have proposed spending part of the $317 million, rather than using it for any type of tax relief.

Sen. Ann Rest of New Hope, the assistant leader of the Senate Democrats, called the tax holiday a bad idea.

“We should be addressing issues of energy savings and encouraging people to plan their driving better … (to) use transit and car pool.”

Kohls said he personally would prefer to use the $317 million for property-tax rebates and the income-tax relief for married couples. He said he offered the tax holiday as an alternative that might win support from Senate Democrats.

On Tuesday, when Kohls and three House Republican colleagues — Laura Brod of New Prague, Chris DeLaForest of Andover and Joe Hoppe of Chaska — went to a St. Paul gas station to promote their legislation, gasoline cost about $2.79 a gallon in the Twin Cities.

Six years ago, when gas was averaging $1.81 a gallon, a proposal similar to Kohls’ plan was urged by House Speaker Steve Sviggum and Pawlenty. Sviggum and Pawlenty, then the Republican majority leader in the House, unsuccessfully urged former Gov. Jesse Ventura in June 2000 to call a special legislative session to drop the gas tax from July 4 through Labor Day.

On Tuesday, both Sviggum and Pawlenty said they would support Kohls’ tax-holiday plan — but only as their second choice if they could not enact the property-tax rebates and tax cuts for couples.

“I don’t think it should jump ahead of property-tax relief or the marriage penalty,” Pawlenty said.