Haslam: Gas tax hike gives TN ‘a step up in the game’ under Trump’s infrastructure proposal

Gov. Bill Haslam says the state fuel tax increase approved by the legislature last year puts Tennessee in a good position to leverage federal transportation funding under the new infrastructure plan proposed by President Trump on Monday, reports Michael Collins.

The Trump proposal envisions $1.5 trillion in new investments in highways, bridges and mass transit over a 10-year period, but only $200 billion would be in new federal money – the rest in state and local funding or private investment, according to the New York Times. States would have to put in a bigger share of the money for projects, or get private investment, to trigger the new federal funding.

Haslam attended Trump’s briefing on the proposal Monday. From Collins’ article, as appearing in The Tennessean:

Haslam said federal officials have assured the state that money generated through Tennessee’s Improve Act would count toward the state’s share of funding for any project that is approved for Tennessee.

“We feel like that means we’re well positioned to take advantage of this, and we might not have been without having that (bill) passed,” Haslam said.

The Improve Act, passed last year, increases the tax on regular gasoline by 6 cents and diesel fuel by 10 cents incrementally over the next three years. The legislation, which is balanced by other tax cuts, is expected to raise millions of dollars to help pay for a $10 billion backlog in needed transportation projects.

During Monday’s White House meeting, Haslam referenced the bill in remarks to Trump.

“Last year, in Tennessee, we combined the largest tax cut in history with actually increasing revenue toward transportation because our infrastructure was so out of date,” Haslam told the president.

“Tennessee is really keeping up,” Trump responded. “They’re doing a good job. I looked at some numbers yesterday, and it’s really – really doing a good job.

“You’ve made a big difference in Tennessee,” Trump added.

… In an interview after the meeting, Haslam said that while many details of Trump’s infrastructure plan have yet to be released, “we’re encouraged that there is an infrastructure plan.”

“I think an infrastructure plan for the country is long overdue,” Haslam said. “We have serious issues around our roads and bridges and transportation systems, so to finally have that addressed in a new way is encouraging. … And we are even more encouraged that the steps we took last year in Tennessee give us a step up in the game.”

… Haslam said the block grant money could potentially help Tennessee expand broadband service into rural areas. Nashville’s proposal for a new public transit system is the kind of project that could potentially qualify as a transformative project under the administration’s proposal, he said.

The Wall Street Journal  report has this comment from the governor:

Tennessee Gov. Bill Haslam, a Republican, praised the administration’s efforts but said states also need the administration and Congress to find a way to replenish the Highway Trust Fund, which provides the majority of federal transportation funding to the states.

“We’re concerned with the Highway Trust Fund balance where it is now,” said Mr. Haslam. That account is funded by the 18.4-cent-per-gallon federal gas tax, which hasn’t been raised since 1993 and is headed for insolvency by 2021 without infusions of additional funding or a tax increase.