Connecticut governor John G. Rowland recently signed a $13.2-billion budget that calls for a 44% increase in the state's diesel fuel tax, a cause for concern for truckstop owners and fleets that call the state home.
The jump from 18 to 26 cents per gal. will go into effect August 1. The tax increase is projected to produce about $25 million in additional revenue, according to proponents.
The Associated Press said the proposal did not go through the normal legislative process, but came to light two days before the fiscal year ended – the final deadline for lawmakers to pass a budget deal.
"There was never a bill to increase this tax and there never was a public hearing on it," said Michael J. Riley, president of the Motor Transport Assn. of Connecticut.
According to Riley, the state increased the diesel tax four times between 1987 and 1991, and fuel sales dropped 12.3%. In September 1991, the same year a state income tax was adopted, legislators experimented with dropping the diesel tax from 23 to the current 18 cents, which generated 33.9% more in tax revenue today than in 1991.
Riley said lowering the tax helped truckstops in Connecticut rebound from near bankruptcy because truckers would not pass through the state before fueling. Lower diesel taxes also helped to persuade major interstate carriers to base facilities in Connecticut, he said.
Trucker Carroll Dugan told AP that owner-operators will feel the increase more than trucking companies because they do not have the power to negotiate fuel prices with truckstops.