Locals speculate on effects of gas tax increase
Published 3:42 pm Friday, January 18, 2019
In his annual “State of the City” address Monday, Selma Mayor Darrio Melton discussed his intention to propose a 5-cent gas tax in order to raise funds for the city.
According to Melton, a 10-cent statewide gas tax being considered by state leaders would have local citizens contributing to infrastructure repairs in other counties, as the tax would be contributed to the city in which it’s charged.
Melton’s plan is to institute the local tax before the state’s tax hike takes effect, which won’t be taken up until the Alabama legislature convenes in March.
According to AAA, the average price of gas in Dallas County is $1.96 per gallon, which puts the county just below the highest tier of gas prices in the state.
A 5-cent increase in Selma, in addition to the proposed statewide tax increase, would place the city among the most expensive places to buy gas in the state. According to AAA, Alabama counties over $2.003 are in the highest tier for gas prices – the 5-cent tax would put Selma at $2.01 as an average price per gallon.
Currently, Selma has a 4-cent gas tax. For those living outside of the city limits but within police jurisdiction, that tax is only two cents – beyond that, the city does not collect tax revenues from gas.
Rex Jones of Cougar Oil believes a city gas tax hike would hurt people on a number of levels.
“I think it will hurt the businesses on the outskirts of town,” Jones said. “People are going to go to the guy that’s cheaper.”
By Jones’ calculation, gas buyers would likely purchase their gas from places just beyond the reach of the city’s gas tax and therefore put a pinch on business owners.
Jones ran into a similar situation doing business in Florida – when Escambia County raised its gas tax, many of the businesses he supplied gas to went out of business as customers simply went across county lines to purchase fuel.
“Gasoline’s a game of pennies,” Jones said. “We don’t make a lot as it is.”
Additionally, Jones noted that the pain of the tax would reach the consumer’s wallet.
“Some people would benefit, but some people it would hurt,” Jones said. “But everybody’s going to have to pay. It’s a big deal. On top of the state increase, that’s going to make it even harder for the public.”
After Melton’s address broaching the subject of an increase to the city’s gas tax, Councilman Carl Bowline noted that he supports the idea but believes a compromise could be reached in regard to the price of the increase.
For his part, Bowline thinks a 3-cent tax might be a little easier to swallow for consumers. However, he would like to see the revenues from that tax earmarked for infrastructure repairs throughout the city.
Councilwoman Miah Jackson took exception with the mayor’s suggestion for a number of reasons, stating that a gas tax increase will “do more harm than good for our local economy and impose an added burden on the poor.”
Jackson suggests that the city work to build stronger relationships with the county in an attempt to collect revenues from the future statewide tax hike and noted that the city has not “adequately exploited” its current opportunities through gas and other tax collections.
Wayne Vardaman, Executive Director of the Selma-Dallas County Economic Development Authority, has mixed feelings about the possible tax increase – while it could be a benefit if used for proper purposes, it would also have an adverse effect.
“You’re just taking money out of the marketplace,” Vardaman said. “That’s just less disposable income people have to spend on goods and services.”
However, Vardaman noted, the impact on individuals would not be a “tremendous amount” – for a person purchasing 10 gallons of gas per week, the cost would be less than $30 annually.
Vardaman added that it needs to be made clear exactly what the additional revenue would be spent on. For his part, he believes infrastructure would be a worthwhile cause.
“The roads have a lot of potholes,” Vardaman said. “Anything to help that would be a good thing.”