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Highway Funding Bill Set to Be Signed by Governor

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An Arkansas highway funding bill that’s “been years in the making” is expected to be signed on Tuesday by Gov. Asa Hutchinson in a ceremony at the state Capitol.

Senate Bill 336 was delivered to the governor on March 5 and is one of two proposals that will change how highways in the state will be paid for, says Shannon Newton, president of the Arkansas Trucking Association.

“We’ve been very involved with the formation of policy and getting the governor and legislative leadership signed on to pass a highway funding bill,” she said by phone from the state Capitol. “We are very pleased with the plan and worked every day at the capital to make it happen.”

The plan is in two parts, the first is the senate bill that will increase fuel taxes, add registration fees to electric and hybrid vehicles along with securing some additional monies from casino revenues.

That works out, Newton says, to an additional $95 million annually for the Arkansas Department of Transportation with gas tax going up three cents, while diesel tax will increase by six cents a gallon.

Fees for electric cars and hybrids would become, respectively, $200 and $100 annually. Numbers that Jennah Denney, marketing coordinator for Today’s Power, calls unfair.

“We don’t feel that it is a fair but we do think that there should be fees,” Denney says for electric and hybrid vehicles.

She explains that electric vehicles drive about 6,300 miles annually, while conventional vehicles are on the road an average of 10,200 miles, while what she calls a conventional hybrid vehicle is out and about nearly 12,000 miles annually. Fees should be staggered to use, Denney says, with those types of cars paying $60 annually, with purely electric cars paying the least at $35 per year.

“As of August 2018, there’s over 1,000 vehicles that are electric or hybrid with electric plug-ins,” Denney says. “Most of them are condensed to central and northwest Arkansas.”

She acknowledges that the additional fees wouldn’t lead to fewer electric and hybrid vehicles being sold in the state.

“The market is growing at about 1 percent annually,” Denney says of national sales. “Arkansas is on par with that average and what’s really pushing adoption in the market is education and infrastructure. The ability to charge in public is something that leads to more sales.”

But what’s on the road are cars, trucks and 18-wheelers, and the bill expected to be signed will lead to more and better roads in Arkansas.

The other piece in the two-part plan is House Joint Resolution 2018 that has already been passed and will let voters decide to extend a half-cent sales tax to repair and improve the state’s roads.

“Arkansas voters will have the final word on funding for the construction and repair of the roads they drive each and every day,” Hutchinson said in a release last week.

The original sales tax proposal was designed to sunset, Newton says, but if passed by voters, would be extended indefinitely.

If passed, the sales tax would generate more than $200 million annually with total revenue being $300 million.

“We’ve been advocating for a highway program for years and this has been years in the making,” Newton says. “It can’t be understated that this governor and this legislature … support investing in more infrastructure.”

READ MORE: Cash and Candor: Legislative Recap

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