Today, Governor Bill Haslam released the Improving Manufacturing, Public Roads, and Opportunities for a Vibrant Economy (IMPROVE) Act. The plan proposes increased funding for the state’s transportation needs, including $278 million in new dollars. The Governor’s proposal relies on the following sources of revenue:
- New Revenue Sources:
- An increase of $0.07 and $0.12 per gallon on the state’s gas and diesel fuel taxes, respectively
- Tie the state’s gas and diesel fuel taxes to inflation
- A $5 increase, on average, on annual car registrations
- A new annual road user fee for electric vehicles
- An increase in charges on vehicles using alternative fuels
- A 3% charge on rental cars
- Existing Revenue Sources:
- A one-time transfer from the General Fund to the Highway Fund from the FY 2016-2017 budget surplus
- A change in the state’s open container laws that will provide flexibility for additional federal funding to be used for road projects
To offset the new revenue increases, the Governor’s plan also proposes reductions in taxes on groceries, corporate taxes paid by manufacturing businesses, and the Hall Income Tax on investment income.
As the Tennessee General Assembly prepares to consider the Governor’s proposal, we have created a 2-page fact sheet with basic information about Tennessee’s Highway Fund – how it is funded, how that funding has changed over time, how the state’s gas and fuel taxes have changed over the years, and other trends impacting highway funding. The fact sheet is available for download below – along with standalone graphics of each of the fact sheet’s key pieces. A separate comparison of Tennessee’s Highway Fund with and without one-time funding from The American Recovery and Reinvestment Act of 2009 is available here.
To download images, click on each image below, left click or Ctrl+select on the image, and “save image as” to your computer.