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Legislators work to head off gas tax hike

Posted: August 22, 2014 6:12 p.m.
Updated: August 22, 2014 6:12 p.m.

Some state legislators are working to stop or delay what they describe as a “hidden” tax that could cause a spike in gas prices.

At the heart of the issue is California’s cap-and-trade program. Starting next year, that program will include transportation fuels — a change that may result in extra pain at the pump.

The nonpartisan Legislative Analyst’s Office says the resulting price increase would likely be in the range of 13 to 20 cents per gallon by 2020 — but could exceed 50 cents per gallon by that time.

“I am all for clean air and doing what we can to mitigate climate change, but not for a dubious program, not at the expense of our economy and not with a regressive tax,” said Assemblyman Scott Wilk, R-Santa Clarita.

“Low- and middle-income residents, who already dedicate much of their household budget to transportation, cannot absorb such a huge increase in gas prices; higher fuel prices also means higher prices for necessities such as food,” he wrote in a statement.

Cap-and-trade is part of California’s Global Warming Solutions Act, passed in 2006, a law meant to reduce greenhouse gas emissions.

Some of the cap-and-trade revenues are used to fund the California High-Speed Rail project, which was approved by voters in 2008 but has drawn ire as its price tag rose while the economy sank.

Wilk said he is among the co-authors for Senate Bill 1079 from Sen. Andy Vidak, R-Hanford, which would exempt some transportation fuels from the state cap-and-trade program.

“California’s small businesses and consumers face significant economic harm from fuel price increases, and this bill prevents big government from harming our already struggling economy,” Wilk said of the Vidak bill.
State Sen. Steve Knight, R-Palmdale, is also a co-author of that bill.

Knight was also among those who signed a letter urging the Democratic leadership to support nixing or delaying the inclusion of transportation fuels in cap-and-trade.

“Millions of Californians need immediate relief from this hidden gas tax — they did not vote for it, they aren’t aware of it, and they most definitely cannot afford it,” the letter reads.

Another bill, Assembly Bill 69 from Assemblyman Henry Perea, D-Fresno, would delay putting fuels under the cap-and-trade program until 2018.

“The cap-and-trade system should not be used to raise billions of dollars in new state funds at the expense of consumers who are struggling to get back on their feet after the recession,” Perea said in a statement.

A poll published in July from the Public Policy Institute of California showed that most respondents, around 76 percent, favored "requiring oil companies to produce transportation fuels with lower emissions," but support fell to 39 percent if doing so meant higher prices at the pump.

As of Friday, the average price for a gallon of regular, unleaded gasoline in California was $3.87 — the fifth-highest average in the nation, according to AAA’s Daily Fuel Gauge Report.

The price of gas in California has fallen around 17 cents a gallon in the last month, according to AAA.

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