As the price of oil hits $100 a barrel, Ron Williamson of the Great Plains Public Policy Institute says that it's time for South Dakota to be careful about the way it spends gas tax receipts: 

While South Dakotans and tourists find new meaning to the phrase "pain at the pump" with gas prices again reaching the $3 mark, there are rumblings of a gas tax increase.

These rumblings started when the Governor recommended that the FY2009 Highway Patrol budget be cut.  The Patrol budget is funded with gas tax revenue.  This brought some obvious and expected dissatisfaction from several Legislators.

The "chilling" effects of a tax hike are evident as it impacts individual standard of living, worker's income and causes personal hardship.

At the federal level a five cent increase per gallon has been proposed.  This is at a time when only 60% of the federal gas taxes are spent on highways and the 2008 Transportation Bill allocates $2.2 billion in earmarks.

At the State level, in FY2007 the Legislature budgeted $470 million for DOT and the actual spending for FY2007 was $494 million. (that's an additional $24 million)  In FY2008 the Legislature appropriated $483 million to DOT and DOT budgeted $523 million ( that's an additional $40 million). The Governor's FY2009 DOT Budget recommendation is still $7 million over the FY2008 DOT appropriation.

As we know there is little that can be done about the federal spending and earmarks.  However, there appears to be some opportunity in the numbers at the State level.  The Legislature's Appropriation Committee will be taking a close look at the proposed budget.

Some may argue that the only option available for building new roadways is to raise the gas tax.  The real solution is to prioritize spending of the available gas tax revenue.

THINKABOUTIT