State Representative Jeremy Faison Responds To The Passage Of The IMPROVE Act
This week in Nashville, members of the Tennessee General Assembly passed House Bill 534, the “Improving Manufacturing, Public Roads, and Opportunities for a Vibrant Economy (IMPROVE) Act” — a proposal that Governor Bill Haslam introduced in January that raises the gas and diesel tax and implements a series of other fees in an effort to help fund the state’s $10 billion backlog of road construction projects.
While I have always said we must find a dedicated source of funding to pay for our roads and bridges in Tennessee, I did not support the IMPROVE Act after hearing feedback from our community voicing strong opposition to the plan and the tax increases it contains.
Instead, I supported an alternative plan sponsored by State Representative David Hawk that also would have created a reliable funding source for infrastructure without raising taxes on any Tennessean. By using existing revenue and dollars already in the budget, the Hawk Plan would have dedicated $320 million a year to city, county, and state road projects while still preserving funding for education, health, public safety, and other top budget items. The Hawk Plan was fiscally responsible and would have solved the transportation funding puzzle, all while living within our means as a state — just like every Tennessee family has to do.
Unfortunately, the Hawk Plan failed to receive the necessary votes for passage and the IMPROVE Act was adopted by both the House and Senate this week. While I did not support the bill, it has now officially passed both chambers and will soon be traveling to the desk of Governor Haslam to be signed into law. With that said, I wanted to share the details of the plan with each of you, both the good and the bad.
The bad: The IMPROVE Act raises the gas tax and diesel tax, along with implementing increased fees for vehicle registration. Specifically, the plan will raise the gas tax by 6 cents and the diesel tax by 10 cents over the next 3 years. Registration fees for most cars will be raised by $5, with commercial automobiles and other large vehicles paying $10 and $15 extra. Electric cars will see a new $100 fee for registration.
The good: The IMPROVE Act decreases franchise and excise tax on Tennessee companies aimed at helping recruit new industry to the state. The bill also decreases tax on food from 5% to 4% and cuts the Hall income tax. Increased property tax relief for veterans and the elderly, an issue we have fought for over the last several years, is also included in the plan.
The passage of a new infrastructure funding bill also means the Tennessee Department of Transportation (TDOT) and our local governments will have more money to spend on road projects — TDOT will see increased revenue of $240 million per year, Cocke County infrastructure funding will increase by $659,000 per year, Jefferson County by $634,000 per year, and Greene County by $832,000 per year.
These are all positive things that will come from the IMPROVE Act — sadly, it also means increased taxes for each of us.
The families of our community have been consistent expressing opposition to an additional tax increase throughout this entire process. In a year where we are experiencing a historic budget surplus, we should have chosen to live within our means and not raise taxes at the expense of Tennesseans across our state. However, a majority of my colleagues disagreed with this concept, and the IMPROVE Act will soon be the law of the state. Even though we will see increased costs at the pump and several other places, the legislation does cut taxes in other areas which will be beneficial to each of us.
As always, I remain committed to listening to the voice of our community as we continue forward with the 2017 legislative session.