Increasing taxes — on gas, hotel and motel stays, cigarettes and other tobacco products, big rigs that travel on highways — and creating a state lottery could raise $360 million for infrastructure, a legislative committee concluded Thursday.

Sen. Willie Simmons, D-Cleveland, who chairs the Senate Transportation Committee, which is holding hearings this week, said Mississippi has fallen behind on maintaining its roads and bridges in part because taxes have not been raised in years.

“We have chosen to remain constant with the amount that we’re charging at the pump,” Simmons said at the beginning of Thursday’s hearing.

Information distributed at the hearing shows that total transportation funding for Mississippi in 2017 was $1.1 billion compared to $395 million in 1989, with most of the increase driven by rises in construction costs.

Specifically, it cost $3 million to construct one mile of highway in 1987 compared to $10.2 million today. It cost $12 million to build a 10,000-foot bridge in 1987 compared to $29 million in 2017, according to information passed out during the meeting.

Simmons asked the Mississippi Department of Revenue to project potential revenue from a number of scenarios. Increasing the 18.4-cent gas tax by seven cents per gallon could generate $164 million, said Kathy Waterbury, a revenue-department spokeswoman who addressed the hearing.  A state lottery could raise $80 million, she said.

The Senate Transportation Committee projects the state could raise about $360 million by raising taxes in several areas. Credit: R.L. Nave, Mississippi Today

Raising the cigarette tax to $1 (it currently is 68 cents per pack) would raise $58 million, Waterbury said, but that figure does not consider the potential impact if higher taxes causes people to cut back on smoking.

“There’s been a slow decline in smoking so (tax) collections are decreasing on their own,” Waterbury said. “We’re not able to project … what the future might be. I can’t tell you what’s going to happen in the next 10 years.”

Simmons did not ask revenue officials to discuss the possibility of charging a tax for online purchases, however. During the last legislative session, lawmakers in the House noted that taxpayers already voluntarily pay $60 million when they shop online and projected using those funds to help pay for road repairs.

The issue met defeat in the Senate because Lt. Gov. Tate Reeves said he believes collecting online sales would be illegal. In 1992, the U.S. Supreme Court ruled that states did not have the right to tax interstate sales, including internet sales.

“That wasn’t something we had a big interest in,” Simmons said, when asked why his committee did not look at Internet sales taxes. “One because of the unknowns — we don’t know if, legally, we’re ever going to be able to do it and then, secondly, we don’t know what kind of dollars it’ll generate.”

Jeff Dungan, a county engineer in Marion County, said the state faces a crisis with its roads and bridges, a problem that is amplified by the deterioration of bridges with timber components, of which Mississippi has more than any other state.

Of the 9,865 bridges counties are responsible for maintaining, 310 of them are closed (up from 307 as of Wednesday), Dungan said. Of those close bridges, 232 have timber components.  

Sen. Billy Hudson, R-Hattiesburg, took exception to Dungan’s testimony, which Hudson said seemed to imply that county supervisors aren’t minding their stores when it comes to addressing problems with crumbling roads and bridges.

“I know how they struggle with their budgets. What can they do?,” Hudson, a former supervisor, said after the meetings. “If you raise property taxes even more — they’re already too high. So skin in the game? I don’t know. They do the best with what they have.”

The hearings will continue Friday at 9 a.m.

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Ryan L. Nave, a native of University City, Mo., served as Mississippi Today's editor-in-chief from May 2018 until April 2020. Ryan began his career with Mississippi Today February 2016 as an original member of the editorial team. He became news editor August 2016. Ryan has a bachelor’s in political science from the University of Missouri-Columbia and has worked for Illinois Times and served as news editor for the Jackson Free Press.

2 replies on “Tax hikes for roads get a hearing – next step may be bumpy”

  1. Time to cull the herd at MDOT, starting at the top. Investigate where the tax money goes, jail those stealing from public coffers. It’s time to END Mississippi political corruption.

    1. Why aren’t ANY leaders demanding to know where the blatant incompetence or perhaps knowing and deliberate malfeasance resides? WHERE has the money gone that was meant for infrastructure? Where are the investigative journalists?

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