BISMARCK — North Dakota's gas tax has stayed steady since 2005, but several Republican lawmakers are pushing a bump at the pump to tackle costly infrastructure repairs.
Drivers in the state currently pay 23 cents in tax per gallon of gas or diesel — more than nickel under the national average. A freshly amended version of House Bill 1464 would take the fee up to 29 cents. The House Finance and Taxation Committee on Monday, Feb. 1, voted 9-5 to give the bill a "do-pass" recommendation as it heads to the House floor.
Prime sponsor Rep. Vicky Steiner originally proposed a more modest increase to appease tax-averse conservatives in the Legislature, but a majority of the committee felt the state's aging roads and bridges required a more potent approach. Steiner, a Dickinson Republican, said she respects the committee's direction on her bill, but she's not certain her colleagues in the House will go for the bolder tax hike. Similar efforts to raise the gas tax failed to pass either chamber in 2019.
Steiner said raising the gas tax would help lessen the enormous impending burden of fixing sub-par infrastructure. A recent North Dakota State University study found maintaining and repairing local roads in the state will cost $9.3 billion over the next two decades, but each penny the gas tax is raised would bring in an estimated $7.4 million a year for infrastructure funding.
"I can't say I'm thrilled to bring a user tax increase, but it needs to be done," Steiner said.
The Department of Transportation and lobbying groups for counties, cities and construction companies backed the recent drives to inflate the fee, saying the road and bridge problems will get more expensive the longer the state waits.
It's a simple calculation for Steiner, who said the roads and bridges will be mended one way or another. By raising the gas tax, it means not all of the necessary funding will have to come out of the voter-approved Legacy Fund, she said. Several proposals in the legislative pipeline would use earnings from the state's oil tax savings account to pay for infrastructure, but Steiner argues sapping the fund amounts to "taking some opportunity away from our kids and grandkids."
If the bill passes, North Dakota's tax will be slightly lower than what South Dakota charges and slightly higher than what Minnesota levies.
Steiner's bill also nudges up an annual fee paid by owners of electric vehicles to make up for their lack of gas tax payments.
West Fargo Republican Rep. Ben Koppelman voted against the bill because he said it doesn't address the structural problem of failing to account for inflation in the gas tax. Koppelman said he would be more likely to support a proposal that ties fee increases to the rate of inflation, but other committee members rejected the idea as logistically difficult and harder to explain to the public.
House Majority Leader Chet Pollert declined to comment on the bill, saying he's waiting to see the full picture for infrastructure funding that includes federal dollars. The Carrington Republican added Steiner's desire to preserve Legacy Fund earnings is a "fair argument" that the Legislature will have to consider.
A spokesman for Gov. Doug Burgum declined to comment on the bill, but the Republican governor proposed a budget in December that emphasized no tax increases.