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Beshear files emergency regulation to stop rise in state gas tax

Beshear files emergency regulation to stop rise in state gas tax
Published: Jun. 2, 2022 at 1:08 PM EDT
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FRANKFORT, Ky. (WKYT) - An increase in Kentucky’s gas tax has been stopped.

Gov. Andy Beshear’s administration filed an emergency regulation to freeze the state gas tax and to prevent a 2-cent increase per gallon that would have taken effect July 1.

“Kentuckians cannot afford to pay more, and I am committed to doing everything I can to help keep more dollars in people’s pockets,” said Gov. Beshear. “This law was never intended to hurt Kentuckians during tough times, but with rising prices and inflation, this increase would have a negative impact on our families and it is time to take action.”

The state gas tax is set by statute, both in its rate and how it is calculated. The current rate of 26 cents was set to increase under a trigger, resulting in a price hike on both regular and diesel fuel.

The funds collected through the state gas tax contribute to the Road Fund, which year to date is up 2.3%.

Over the first seven months of the fiscal year, this action will reduce the budgeted Road Fund revenues by 1.6%. Gov. Beshear will propose using funds from the upcoming General Fund budget surplus to make up for the lost road fund revenues.

“We will continue with no material impact to our operations,” said Kentucky Transportation Cabinet Secretary Jim Gray. “We will continue with all of our material projects that have been planned. That’s roughly 1500 projects across the state.”

The budget for next year also includes a 21% increase in transportation infrastructure dollars from the federal government.

Beshear says his action will last until, at least, the General Assembly meets in January, when it can make a policy determination then.

House and Senate leadership are questioning this move. Senate President Robert Stivers says the governor’s action is illegal. He and House Speaker David Osborne said it will have little, if any, effect with prices nearing $5 a gallon.

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