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| What would a 4 cent reduction on gas locally cost our General Fund in Escambia County? |
Channel 3 requested and subsequently conducted an interview with me yesterday on the topic of the President's "Federal Gas Tax Holiday." Apparently we as local communities and counties will be asked to forego local gas taxes as well along with the federal reduction if it occurs--ostensibly in order to cobble together enough savings to where the average consumer would actually feel "some" relief at the pump.
The state is doing something similar in the month of October.
The idea is fraught with problems, in my opinion, as I explained during the interview which I don't think Channel 3 used. Which is fine, no worries. It's probably no a popular viewpoint I have on this.
Number one problem is I don't know that the President will have support---in his own party---to get this done.
Number two is, 18 cents in federal taxes on a gallon of gas--even if the congress did support this-- would likely be slurped up by the stations, oil producers, refiners and the distributors--with very few pennies of the 18 cents winding up back in consumers' pockets.
The other argument is that with gas in some areas approaching $7 per gallon---even if all 18cents on a gallon of gas went back into consumer's pockets----for a 10 gallon fill up this only represents a savings of $1.80 on a cost of $70 dollars on the fill up. $1.80 on a $70.00 fill up is a savings of only a little over 2% and a negligible amount when juxtaposed to the $70. $1.80 doesn't even buy a cup of coffee at waffle house or denny's these days.
Locally--our 4 cents per gallon goes exclusively to support mass transit and generates nearly $5 Million per year for ECAT. Giving that funding up --even for a short duration--would provide very negligible relief in and of itself (e.g at $5.00 per gallon on a 20 gallon fill up costing $100---the savings to an individual if all four cents directly lowered the price which is not a guarantee--adds up to less than a dollar--$.80cents.). But the overall costs to our general fund could reach a million dollars or more--depending upon how long such a "tax holiday" would last; if we cut this tax for 30, 60, or 90 days--we would have to plug that funding hole with general fund dollars totalling betweeen $416,000-$1,250,000 (depending upon length of the holiday).
I explained to Ch. 3 that the board has not discussed this, and that I do not know if a discussion is planned, but I would obviously be willing to have this discussion. But I also told them the better option is for the federal government to actively work to increase supply--which will drastically reduce costs rapidly without constricting demand and utilizing a gimmick bandaid solution which is what a gas tax
