Ark. House speaker unveils $2.8 billion highway plan

Plan, which involves raising diesel tax and temporary sales tax increase, has broad support

News Arkansas News February 25, 2011
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Arkansas House Speaker Robert S. Moore Jr. has outlined a $2.8 billion highway program that would both maintain existing highways and connect the entire state with four-lane roads, Arkansas News reported.

The plan consists of two proposals to raise money for construction: one would raise the state diesel tax 5 cents per gallon, and the second would create a temporary half-cent sales tax increase.

If the state Legislature approves the plan, voters will have the final say on both tax increases. The diesel tax would be part of a special election next year, while the sales tax would be on the general 2012 election in November.

If the diesel tax is passed, it would increase the tax from 4 cents to 9 cents per gallon. Initial estimates say the tax could bring in anywhere from $575 million to close to $1 billion for highway maintenance.

The proposed sales tax increase would last for 10 years and could fund a $1.8 billion bond program.

Moore said the plan has the support of several major players, including the Arkansas Highway Commission and Arkansas Trucking Association. Currently, the state funds highway construction with revenue from the gas tax, which has stagnated in recent years. Over the next decade, officials estimate the highway system will have $19 billion in needs with only $4 billion in revenue.

“We not only have found some extremely valuable funding to take care of the needs that we have now and expand our highway system,” Moore said. “But effectively we buy us about 10 years to continue to look for (ways to address) a problem that is still not going away.”

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