Arizona Lawmakers Reverse Course On Vehicle Fee Increase

By Claire Caulfield
Howard Fischer, Capitol Media Services
Published: Tuesday, March 12, 2019 - 8:19am
Updated: Tuesday, March 12, 2019 - 8:48am

The Arizona House repealed and replaced their year-old plan to fund highway construction Monday.

The original plan would've allowed the head of the Arizona Department of Transportation to set a new vehicle registration fee to fund projects. Before passage, lawmakers were told by the bill’s sponsor the fee would be in the range of $18 a year. After the measure was signed into law, the ADOT director pegged the fee at $32.

The new bill, House Bill 2320, still gives the state Department of Transportation power to set a fee, as long as the cap is $18 a year.

The new measure passed 57-3 but still needs approval from the state Senate and Gov. Doug Ducey, who was counting on the full $185 million from the fee in his budget.

Ducey has built his proposed $10.4 billion budget on collecting the full fee even while insisting that it did not violate his promise never to increase taxes. With HB 2320 he will come up $47 million short.

Gubernatorial press aide Patrick Ptak declined to say whether Ducey planned to sign or veto the fee reduction.

Wait-And-See

ADOT spokesperson Doug Nick said his agency, which began sending out the renewal notices with the $32 fee in December, already has seen an increase in the number of vehicle owners who are taking a wait-and-see attitude, choosing a one-year renewal.

The background of the whole issue is that the state, in a budget-saving maneuver, has for years partly funded Highway Patrol through gasoline taxes. The result of that, however, has been less money for road construction and repair.

The higher fee would've made it possible for the state to free up tax revenue for other priorities, like a promised pay hike for teachers, more expansion to Interstate 10 and road construction and repairs in rural areas.

The measure to decrease the fee from $32 to $18 now goes to the state Senate.

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