Gas Tax & Vehicle Fees Bump May Benefit State’s Black Business Owners

November 01, 2017

(CBM) – A looming hike on the price of gasoline and new vehicle registration fees that will pay for improving the Golden State’s crumbling roadways will send millions of dollars of infrastructure work to minority and women-owned agencies and firms.

State Senator Steve Bradford, a Los Angeles-area legislator, said in an Aug. 17 interview with California Black Media that state leaders aim for 25 percent of funds from Senate Bill 1, a $52.4 billion transportation bill, to be awarded to Black, Hispanic, women, veteran and other minority-owned businesses that specialize in roadwork and tasks related to improving California’s ailing streets and highways.

To fund the revitalization work, SB 1, also known as The Road Repair and Accountability Act of 2017, will increase the state gasoline tax from 12 to 30 cents a gallon over the next decade and create new vehicle license fees on traditional and zero-emission cars.

Panel Discussion June 30, 2017 with Gov. Jerry Brown at CSU Dominguez Hills on equity and access to gas tax transportation funds.

Bradford said the state’s infrastructure has been neglected for 25 years, so improvement is needed, but the main benefit of the bill are the funds that will flow to businesses from traditionally disenfranchised backgrounds.

“The part that got me to say ‘yes’ in voting for this was making sure that diversity was part of this program,” said Bradford, one of 11 members of the California Legislative Black Caucus. “We cannot continue to talk about the job opportunities and the economic growth it will bring if it doesn’t touch all sectors, all ethnic groups.”

According to the California Department of Transportation (Caltrans), the gas tax law will provide an ongoing funding increase of about $1.8 billion annually for maintenance and reworking of California’s highway system, including $400 million for bridges and culverts. The new transportation act, aimed at tackling a mountainous sum or road repair backlog, will also direct monies to local jurisdictions.

The price for a gallon of gas will jump up 12 cents beginning on Nov. 1 and add 20 cents per gallon to the tax on diesel under SB 1. The annual vehicle registration costs, at the start of 2018 will be $25 for cars worth under $5,000, $50 for cars worth between $5,000 and $25,000 and at least $175 for vehicles valued over $25,000. Also under the law, owners of zero-emission vehicles will have to pay a yearly $100 vehicle registration fee beginning in 2020.

Bradford said he supported SB 1, signed into law by Governor Jerry Brown in April, because of the work opportunities it will bring.

“If we are going to ask drivers who utilize California roads to pay an extra 12 cents per gallon and promise billions of dollars for infrastructure,” he said, “some of that must reach minority trucking firms, minority engineering firms, real estate firms, architectural firms, all those types of services that will be needed to build and repair those roads.”
Brown harped on how the bill would bolster businesses owned by minorities, women and veterans earlier this summer. The governor linked the push for more diversity in California infrastructure spending to a move toward general social equality in the U.S.

“This work is part of the larger challenge of making a more equal society and that takes working on many fronts, and we’re going to do that with the money coming to our roads and bridges,” Brown said.

Caltrans says the additional revenue will enable the repair of 17,000 lane miles of pavement, 500 bridges and 55,000 culverts by 2027. The money will also fix 7,700 traffic operating systems, like ramp meters, traffic cameras and electric highway message boards that help reduce highway congestion.

Caltrans announced on Aug. 17 that in anticipation of the funds, the California Transportation Commissions authorized almost $690 million in funding to be put towards 32 major “fix-it first” projects will be started a year earlier.

Caltrans Director Malcolm Dougherty said the state’s roadways have many needs, so his agency is not waiting for SB 1 funding to come in.

“The time to get to work is now and we are lining up the projects,” he said. “SB 1 is a game changing investment for transportation in California, and Caltrans is already putting that money to work across the state.”

Minority and women business owners that want to bid on a SB 1 work through Caltrans must contact the agency’s Office of Business Economic Opportunity.

However, the gas tax increase and new vehicle registration fees has its critics.

An organization of conservative-leaning groups in San Luis Obispo County rallied last week outside of a county courthouse to launch a statewide signature drive to have the gas tax law repealed. And in May, gubernatorial candidate Assemblyman Travis Allen of Huntington Beach filed an initiative calling for the new law’s repeal.

“Many Californians are living paycheck to paycheck and struggling just to make ends meet. Jerry Brown’s massive gas tax increase will add $2.50 every time we fill up our gas tanks, which hits our poor and working class Californians the hardest,” said Allen, who launched a website dedicated to repealing the tax.

“Meanwhile, Sacramento’s special interests are lining up for their $52 billion payday with absolutely no concern on how this will impact California’s hard working families,” added Allen.

Bradford said SB 1 is needed because California’s roads need to be improved and Californians need jobs.

“Democrats and Republicans alike know that our infrastructure needs to be repaired,” he said.