County commissioners look at cap to better sell fuel tax ballot measure

A tax cap is being proposed to strengthen public confidence in a Clark County ballot measure that could boost fuel taxes to more than $1 a gallon by 2026.

Clark County commissioners, whose tax increase measure will appear on the Nov. 8 ballot, will consider the added protection — a cap of 4 cents a year — in coming weeks.

Their goal is to sell Question 5 to voters so the county can raise fuel taxes annually over the next 10 years in order to continue building and improving local roads.

Existing projects that could benefit include the 215 Beltway and the U.S. Highway 95 intersection with the Beltway in the northern valley, a study to improve Las Vegas Boulevard, and a $20 million study on how Interstate 11 would connect from Boulder City, through the Las Vegas Valley and into Northern Nevada.

“I think 4 cents is a generous cap,” commission Chairman Steve Sisolak said Friday. “I think it will solve the infrastructure problems and it will create some jobs and the taxpayer is protected by capping it.”

The fuel tax would stop increasing in 2026 but the increases would stay in effect indefinitely to fund roadway projects.

In Clark County, gas buyers are already paying 62 cents per gallon in taxes and fees, which includes federal, state and county taxes. The proposed ordinance would limit the growth of the county’s fuel tax to 40 cents — for a total of $1.02 per gallon in taxes and fees — by 2026.

Without the cap the county’s fuel tax could grow even larger.

That’s because the fuel tax increases are tied to the rate of inflation.

Projections made by the Regional Transportation Commission of Southern Nevada estimate the fuel tax, if approved, will climb about 3.6 cents per gallon annually, based on a 4.54 percent annual inflation rate connected to the producer price index, which measures road construction costs.

If the transportation commission’s projections hold true, the tax means people would pay 36.32 cents more per gallon by 2026. That would equate to about $2.2 billion to $2.4 billion in fuel tax revenue over 10 years, said transportation commission Chairman and County Commissioner Larry Brown.

Brown called the 4-cent cap a “safeguard” and said it will instill “a higher level of confidence that we, the public agency, will raise only enough money that we need.”

But that safeguard could be removed by a future commission because it is in an ordinance, Sisolak said.

“The only problem with it being separate is that it could be changed down the line,” he said.

Before 2014, county motorists were already paying 52 cents per gallon in fuel taxes and fees. Commissioners approved a three-year tax increase tied to inflation in 2013. November’s ballot measure would be an extension to that.

Contact Michael Scott Davidson at sdavidson@reviewjournal.com or 702-477-3861. Follow @davidsonlvrj on Twitter.