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Proposition 6 – Repeal of Fuel Taxes and Vehicle License Fee Increases

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General Election, November 06, 2018

Overview:

In 2017, the State Legislature enacted Senate Bill (SB) 1 to increase annual state funding for transportation through various fuel and vehicle taxes.

Specifically, SB 1 increased the base gasoline excise tax (by 12 cents per gallon) and the diesel sales tax (by 4 percent). It also set fixed rates on a second (add-on) gasoline excise tax and the diesel excise tax, both of which previously could change each year based on fuel prices. Further, SB 1 created the transportation improvement fee (which ranges from $25 to $175 per year) and a fee specifically for zero-emission vehicles (set at $100 per year for model years 2020 and later).

This fiscal year, the state expects the taxes to raise $4.4 billion from the proceeds of SB 1. Two years from now, when all the taxes are in effect and the inflation adjustments have started, the state expects the taxes to raise $5.1 billion. SB 1 dedicated about two-thirds of the revenues to highway and road repairs, with the remainder going to other programs (such as for mass transit).

Proposition 6 would eliminate any fuel and vehicle taxes passed by the Legislature after January 1, 2017, thereby eliminating the increased fuel taxes and transportation improvement fees enacted by SB 1.  In addition, Proposition 6 would require the Legislature to obtain voter approval for any new or increased fuel taxes, as well as for taxes paid for the privilege of operating a vehicle on public highways.

A YES vote on Proposition 6 means fuel and vehicle taxes recently passed by the Legislature would be eliminated, which would reduce funding for highway and road maintenance and repairs, as well as transit programs.  The Legislature would be required to get a majority of voters to approve new or increased state fuel and vehicle taxes in the future.

A NO vote on Proposition 6 means the fuel and vehicle taxes enacted by SB 1 would continue to be in effect.  The Legislature would not need voter approval for new or increased state fuel and vehicle taxes in the future.

Fiscal Impact:

According to the Legislative Analyst Office (LAO), Proposition result in reduced ongoing revenues of $5.1 billion from state fuel and vehicle taxes passed by the Legislature in 2017 that mainly would have paid for highway and road maintenance and repairs, as well as transit programs.  The requirement that voters approve new or increased fuel and vehicle taxes could result in lower revenues from such taxes than otherwise would have been available.

CCC Position:

No position.

Reflections on Church Teaching:

“Another instrument of political participation is the referendum, whereby a form of direct access to political decisions is practiced. The institution of representation in fact does not exclude the possibility of asking citizens directly about the decisions of great importance for social life.”  Compendium of the Social Doctrine of the Church [413]

"It is the duty of citizens to contribute along with the civil authorities to the good of society in a spirit of truth, justice, solidarity, and freedom.  The love and service of one's country follow from the duty of gratitude and belong to the order of charity. Submission to legitimate authorities and service of the common good require citizens to fulfill their roles in the life of the political community.  Submission to authority and co-responsibility for the common good make it morally obligatory to pay taxes, to exercise the right to vote, and to defend one's country."  Catechism of the Catholic Church, nos. 2239-2240.

"In a system of taxation based on justice and equity it is fundamental that the burdens be proportioned to the capacity of the people contributing."  Mater et Magistra, Encyclical of Pope John XXIII on Christianity and Social Progress, May 15, 1961 (132).