Broad coalition backs extending gas tax indexing in Clark County
Terrible's, the regional gas station chain, did not participate in the hearing for AB530 but is running opposition ads on their digital billboards. (Photo: April Corbin Girnus/Nevada Current)
Clark County's decade-long practice of adjusting gas tax for inflation should continue for another decade before being subject to reapproval by voters, a broad coalition believes.
Fuel revenue indexing — often referred to as FRI — adjusts the county's portion of fuel tax to inflation and has been a major source of funding for roadway projects in Southern Nevada since going into effect in 2014. FRI is currently scheduled to sunset at the end of 2026 unless voters approve an extension next year.
RTC foresees future revenue shortfall if gas tax indexing allowed to expire
For years, the Regional Transportation Commission of Southern Nevada (RTC) has warned that ending fuel revenue indexing will decrease roadway funding by two thirds — from $300 million to $100 million annually. A funding shortage that severe would result in canceled projects and the inability to keep up with roadway maintenance, according to RTC CEO M.J. Maynard-Carey.
RTC's solution to the problem is Assembly Bill 530, which would allow the Clark County Commission, by a two-thirds vote, to extend FRI an additional decade beyond its current sunset date. Continuation beyond 2036 would require voter approval.
Gas Tax in Clark County
Federal: 0.184
State: 0.23
County: 0.10
FRI: 0.23
Other: 0.014
TOTAL: $0.758 per gallon, as of April 1
The Nevada State Legislature and then-Gov. Brian Sandoval first gave Clark County the authorization to use fuel revenue indexing in 2013. The Clark County Commission approved FRI for 2014 through 2016. In November 2016, Clark County voters extended FRI through 2026. That ballot measure passed with nearly 60% support.
RTC currently receives 24.6 cents of the total 75.8 cents per gallon fuel tax, according to Maynard-Carey.
Warren Hardy, chair of the RTC's Transportation Resource Advocacy Committee (TRAC), said the committee has 'looked at every aspect' of funding over several years and determined that 'FRI is the cornerstone.'
'If we are not able to extend FRI, we can fold our tent and go home on a whole bunch of issues related to transportation in Southern Nevada,' he said. 'I've said it's existential, and I stand by that.'
TRAC Vice Chair Danny Thompson called AB530 'the most important bill to Southern Nevada this session.'
More than $1 billion has been generated through FRI since 2014, according to Maynard-Carey. The money has supported 702 projects — 501 completed, 105 in construction, and 96 in the design phase.
The loss of FRI would be compounded by increases in fuel efficiency and the adoption of electric vehicles, which already result in fewer taxable gallons of fuel being sold, added Maynard-Carey.
More than 30 groups threw their support behind the bill during its hearing Thursday in the Assembly Committee on Growth & Infrastructure. Among them: Clark County and its five cities, multiple skilled trades unions, multiple building and construction industry groups, two universities (UNLV and Nevada State), two chambers of commerce (Urban and Vegas), Southwest Gas, and the Nevada Resort Association.
'Fuel tax is the best, most efficient way to collect those dollars that pay for our roads,' said Paul Enos, a lobbyist for the Nevada Trucking Association, which supports the bill.
Just five groups opposed AB530, mostly on the grounds that the county commission should not be able to circumvent voters and that taxes are already too high.
'This takes away the right of the people,' said Janine Hansen of Nevada Families for Freedom and the Independent American Party. 'They were promised 10 years ago they would be able to vote on this. … Are we afraid of a vote by the people? Do we believe in democracy?'
That same criticism was lobbed against a 2023 FRI bill that passed the Legislature with bipartisan support only to be vetoed by Gov. Joe Lombardo. That bill would have allowed the Clark County Commission to extend FRI indefinitely without a direct vote of the people.
(That bill would have aligned Clark with Washoe County, which also indexes their fuel tax to inflation but has no sunset clause. Nevada's other counties do not index their fuel tax.)
'The arguments in favor of fuel revenue indexing are compelling, but a decision on this issue, which impacts household budgets every day, is most appropriately rendered by the voters,' Lombardo wrote in his 2023 veto message.
Democratic Assemblymember Howard Watts, a sponsor of both FRI bills, said AB530's requirement to put the issue in front of Clark County voters in 2036 is meant to address such criticism.
'A final vote of the people has been maintained,' he said. 'We do respect the will of the people while also wanting to make sure that we can continue to provide this critical source of revenue for transportation infrastructure in our state.'
Lombardo's office did not respond to the Current's request for comment on AB530.
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