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‘Underappreciated’ tax will get dirt moving in state

Twelve cents a gallon —11.9 cents if you want to quibble — sounds like a lot of money when it comes to gasoline. It’s enough, if you saw a 12-cent disparity between posted prices at two adjacent retail outlets, to influence which you’ll pull into.

In comparative terms, it’s not. At $3 a gallon, a 12-cent increase is 4 percent. Even when factoring in the total purchase price for a tankful of gas — for math-convenience’s sake let’s use 15 gallons — that’s still an increase of just $1.80. Every penny counts these days, but plenty of stuff we buy regularly fluctuates by a lot more than that without our paying it much notice. In fact gasoline itself regularly posts swings far greater than that. The Washington average for regular unleaded, according to AAA’s Fuel Gauge Report, is about 80 cents a gallon less than a year ago.

That’s a longwinded bit of background to explain why the Legislature’s approval of a transportation package in its most recent session is both underappreciated and hugely consequential.

“Underappreciated,” because there’s been so much other news hogging the spotlight, starting with the length of the session itself and the Legislature’s refusal to call it a year and go home. Then too there were big issues like the budget, school funding, higher-ed tuition cuts and tax increases.

The transportation package came almost as an afterthought to the budget fight, which diminished the attention it got. One more factor — everyone’s been talking about this for so long, and for multiple legislative sessions, that it was anticlimactic when a deal actually materialized.

But it did, and now we start looking for evidence of its effect. The first will come at the gas pump and in the wallet, with 7 cents of the tax increase to hit Aug. 1. The other 4.9 cents will come next July 1.

Beyond that will be the actual moving of dirt. So far there doesn’t appear to be an official timeline for when projects will be put out for bid, contracts awarded, construction started and pavement opened to traffic. But when that does happen, the obvious impacts will be in the inevitable and unavoidable construction-related traffic snarls.

That’s the downside. The upside will be from hiring and money spent on all the products and services that make construction projects possible. The employment impact could be sizable. Employment in the heavy and civil engineering construction category currently stands at about 18,600 (May figures from the Employment Security Department). That’s up from an annual average of 17,100 jobs for 2011, but it’s still well below the nearly 24,000 average for in 2007.

Eventually those projects will get done, or so we can hope — the experience on the Alaskan Way viaduct replacement is not encouraging. It’s not just a matter of adding roadway capacity; the more important projects may be those that relieve choke points and untangle snarls.

As an aside, there are also some potential political implications to passage of the transportation package. One way to look at the session is that the governor had his hat handed to him by Senate Republicans who scuttled his proposals on capital gains and carbon taxes, as well as a low-carbon-fuel provision he wanted. The other way is that Jay Inslee’s task of getting himself re-elected just got easier. Not that it was seriously challenged anyway, but now he can run without being saddled with unpopular tax increases — the gas-tax increase was a decidedly bipartisan affair. Plus, he gets to show up at all the groundbreaking and ribbon-cutting affairs, and what politician doesn’t love that?

What could derail the positive outcomes everyone’s hoping for?

A nasty recession that cuts gas-tax revenue and limits the amount of money available for projects might do it.

So might a runaway project that falls months behind schedule and soaks up millions of dollars more than was planned. The encouraging feature of the current project list is that with most of them, the state is not attempting something radically new, like drilling a highway tunnel in a congested, developed city center, or something risky, like building a new floating bridge. Interestingly, the transportation package legislation includes a provision that “funds in the Connecting Washington Account may not be used for the state Route 99 Alaskan Way viaduct replacement project.”

How about a taxpayer revolt? That might be more of an issue for Sound Transit, which is now authorized to go to voters with its own set of increases. But the relative size of the gas-tax increase and the visible payoff in the form of construction projects dampens the likelihood of that. The folks who came up with those old “Your Tax Dollars at Work” signs had an understanding of the citizenry’s thinking on such matters. In passing the transportation package, legislators hope those attitudes still prevail. They’re probably right.

Bill Virgin is editor and publisher of Washington Manufacturing Alert and Pacific Northwest Rail News. He can be reached at bill.virgin@yahoo.com.

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