Local consumers, government officials respond to gas tax increase

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Drivers filling up in Iowa, like those shown here at Kwik Star in McGregor, are now paying more at the pump after a 10-cent gas tax increase took effect March 1. (Photo by Audrey Posten)

By Audrey Posten, North Iowa Times Editor

Drivers filling up in Iowa are now paying more at the pump after a 10-cent gas tax increase took effect March 1.

The increase, which is the first the state has seen since 1989, will provide around $215 million annually for Iowa roads and bridges, according to Iowa Department of Transportation Director Paul Trombino. Some of that funding will be distributed locally, to the cities and county.

“I think it’s long overdue in this state,” said McGregor resident John Kohlstedt.

That’s a sentiment Monona City Administrator Dan Canton echoed at the city’s March 2 council meeting.

“This helps a lot,” he said, noting Monona could anticipate an additional $25,574, according to the Iowa League of Cities. “We’ve been treading water. What we were getting, we were spending.”

Other local cities will also see increases of varying amounts, including $14,381 to McGregor, $6,651 to Marquette, $3,271 to Farmersburg and $1,977 to Luana.

Much of the funding will be spent in more dense, high-population areas, said Marquette City Manager Dean Hilgerson, so people in those areas will likely see more of an impact.

“What happens in the rural communities remains to be seen,” he said.

Just under $1 million extra will go to Clayton County, shared County Supervisor Gary Bowden. While the additional funds will help, it’s still not enough, he said.

“Even with the new tax, we only have $3.5 million to spend on county roads and bridges,” he said. 

With 1,100 miles of road—900 gravel and 200 paved—and 260 bridges to maintain, that doesn’t go far, he said, when $1 million goes for gravel and additional funds go to labor, equipment and shop buildings. To put things into perspective, he said, the small bridge recently replaced near Farmersburg cost $600,000. 

“We’re so limited with funds,” Bowden added, “so we have to pick and choose where to spend it.”

Bowden said people shouldn’t expect the tax increase to immediately turn everything around statewide, either.

“An independent study showed 47 states had better roads and bridges than Iowa,” he said. “It will be very hard for Iowa to catch up. It’s sad that we got that far behind.”

State Senator Michael Breitbach, of Strawberry Point, voted for the gas tax increase, stating in his Feb. 26 “Bottom Line” column that he felt it was the best course of action, as it will get money from out-of-state travelers.

“It is estimated 20 to 30 percent of the traffic on our roads is vehicles from out-of-state,” he said. “My feeling is the out-of-state traffic that uses our roads should help pay a portion of the cost to build and maintain them. This provides a way to do that.”

McGregor City Administrator Lynette Sander agreed roads need to be fixed, but admitted a more gradual increase would have been more ideal.

Kohlstedt and fellow driver Kathy LaBarge, also of McGregor, felt the same.

“The only good thing about it is that it will help the roads in the state,” LaBarge said of the increase. “But it’s not good that it’s taking more out of peoples’ pockets, especially in this area, where wages aren’t as adequate.”

State Rep. Patti Ruff, of McGregor, voted against the bill, citing the impact on local consumers as one of her reasons.

“This is too much for working families trying to pay bills and put food on the table,” she said in her legislative column issued Feb. 26. “Allamakee and Clayton Counties are two of the poorest counties in the state. Both counties are in the bottom one-fourth out of the 99 counties in per capita income.”

Ruff said she voted against the bill not because she didn’t think Iowa roads and bridges needed to be fixed, but because the bill is not a long-term solution, nor does it, in her eyes, adequately expand the use of renewable energy.

She said she also feared competition from neighboring states, where prices are now lower, will be detrimental to border towns.

For much of last week, across the Mississippi River, in Prairie du Chien, gas prices were five cents lower than in Iowa ($2.39 as opposed to $2.44), only coming up even with Iowa prices over the weekend. That was a reversal from the pre-increase era, when Iowa gas prices were normally around five cents less than those in Wisconsin.

“We’ll be as competitive as we can,” said Brian Johnson, vice president of finance for Casey’s General Store, referencing the company’s Marquette location.

Inventory is turned over frequently enough, he said, that there could be a price swing to make the store more competitive with gas stations across the river.

“There will be a slight competitive disadvantage. It’s definitely unfortunate for that store and fuel is definitely important, but we make most of our money inside the store,” he said, explaining that the difference will be made up on the sale of cigarettes and other products. “We’re very happy with the Marquette store and we’ll continue to deliver a good product and experience.”

Kwik Trip, Inc., which operates the Kwik Star locations in McGregor and Monona, declined to comment on the issue.

Both Kohlstedt and LaBarge said the gas tax increase won’t affect where they buy gas.

“I always buy in McGregor. I rarely buy in Prairie,” LaBarge said. “I live right here, so it’s more convenient. I like to support the community.”

Kohlstedt said, by the time he’d make the trip to Prairie du Chien to buy less expensive gas, he didn’t feel he’d be saving that much.

“There’s not enough of a difference to go to Wisconsin,” he said.

Hilgerson said only time will tell the impact of the increase.

“Initially, we’ll anticipate an increase [in funding] if consumption remains stable,” he said. “We’ll have to consider the impact of local gas prices across the river and we’ll have to see if consumer buying patterns change.”

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