Ohio may pair income tax cut with gas tax increase, Senate leader says

The DeWine administration proposed increasing the state gas tax by 18 cents-per-gallon over the current 28-cents to bring in $1.2 billion a year for roads and bridges. Without the money, the Ohio Department of Transportation faces a fiscal cliff, the administration argues.

Obhof is skeptical and said “I’m not sure that it is trouble….We are going to air that out. We’re going to ask them tough questions. We’re going to see what their assessments are and we’ll decide for ourselves whether we agree with that or not.”

He also noted that some senators support imposing fees on alternative fuel vehicles, such as electric cars, as a matter of fairness. ODOT Director Jack Marchbanks has said that requiring electric car owners to pay $250 and hybrid owners to pay $75 a year would generate about $2.6 million.

RELATED: Here's how much local governments would get from Ohio's new gas tax

The $7.4 billion two-year transportation budget bill must be signed into law by March 31.

Obhof raised the prospect that the gas tax increase could be peeled out of the transportation budget bill and later inserted in a separate bill that deals with tax reform.

Gov. Mike DeWine said on Tuesday that he initially pushed back against a gas tax hike until he saw the financial data.

“18-cents is a minimalist approach, it is a conservative approach, it is frankly a status quo approach. People aren’t going to wake up in two years and think they’re driving on the most fabulous roads in the world. But it’s going to keep us in the game, it’s going to save lives and it’s going to allow Ohio to continue to grow,” DeWine said.

The last gas tax increase came in 2005.

DeWine wants the hike to begin July 1 and then be tied to inflation in future years, allowing it to automatically rise without returning to lawmakers for further approvals. The same 60-40 percentage split would continue between the state and local jurisdictions.

If lawmakers agree to the entire increase, the total state gas tax would be 46 cents per gallon. That would put Ohio’s gas tax in line with neighboring states: 58.7 cents in Pennsylvania, 44.1 cents in Michigan, 42.9 cents in Indiana, 35.7 cents in West Virginia and 26 cents in Kentucky. Pennsylvania’s gas tax is the highest in the nation. Alaska’s 14-cent gas tax is the lowest.

The Ohio Constitution mandates that gas tax revenue only be used for construction, reconstruction, maintenance and repair of public highways and bridges.