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Monday, January 12, 2009

State Oil Board Backs Gas Tax Increases

(CONCORD) The state Oil Fund Disbursement Board is pushing a pair of gas tax increases to boost flagging funds used to clean up petroleum storage tanks. At its first meeting of 2009, the Board discussed two bills being drafted by Representative Chris Christensen (R-Merrimack), who was re-elected Chairman. The panel oversees several state funds which assist gas station owners, as well as cities and towns, to clean up leaking gas storage tanks and monitor groundwater near contaminated sites.

Christensen's first bill would increase the state's import fee on fuel oil by 25%, from a penny per gallon to 1.25 cents, with the revenues going to the Fuel Oil Discharge Cleanup Fund (FOD). The Department of Environmental Services estimates the increase would generate $680,000 in revenues. The FOD has received $925,000 so far this fiscal year, but has paid out over $1.7 million, and currently has a balance of just $125,000.

The second proposal would increase the import fee on diesel fuel by 17%, from 1.5 cents per gallon to 1.75 cents. Those revenues would flow to the Oil Discharge and Disposal Cleanup Fund (ODD). DES projects this fund to spend up to $2.5 million more than it takes in in Fiscal 2009, drawing the ODD fund down to just over $1.3 million.

The Board also weighed in on a draft proposal being prepared by Representative Candace Bouchard (D-Concord), which would lapse the ODD Fund in 2012, three years earlier than current law. Bouchard would then transfer some of the remaining money towards highway and bridge repair. According to Christensen, Bouchard would like major gas station chains to pay for their own oil tank cleanup projects, and not receive state reimbursement.

The Board spent several minutes discussing the legislation's political prospects, such as its chances of coming out of the House Ways and Means Committee. Senator Harold Janeway (D-Webster) suggested using the projected cost of the bill to kill it, noting that the Fiscal Note prepared by DES could "do the job.". The Board voted unanimously to oppose the bill as proposed. Under Section 146-D, the Oil Fund Disbursement Board lacks any authority to provide legislative recommendations or lobby the Legislature. The Board will meet next on March 2.

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