Counties could add a tax to gasoline sold at pumps

County officials could approve a gasoline tax capped at 2% of the sale price. The tax would cover gasoline sold at retail pumps in the county, except inside a city or town that keeps both local taxes named in the bill. Officials must first hold a public hearing devoted to the proposal. Gasoline sales exempt from state sales tax would also be exempt. The tax would apply to sales after the later of the date named in the county ordinance or the last day of the month following its adoption.

A county would have to end both county vehicle taxes before its gasoline tax could take effect. The county rule covers counties charging both a wheel tax and a vehicle excise tax. A separate limit applies to cities and towns charging both local taxes named in the bill. A county with both taxes would have to rescind both before its gasoline tax could take effect. The county could collect the gasoline tax outside a city or town that keeps both listed local taxes, but not inside it.

County officials would share gasoline tax money with eligible cities and towns that ask to participate. This covers cities and towns in a county that adopts the gasoline tax. City or town officials must approve support for the tax and request a share at a public hearing. A city or town charging both specified local taxes could not receive money until it ended them. The county would divide the money each month based on the road lane miles of the county and each eligible city or town.

Local officials would have to spend gasoline tax revenue on uses listed in the bill. These limits would cover counties and cities or towns that receive the tax money. Counties without a consolidated city and participating cities and towns could use the money for street and road work, payments to certain authorities, or local matches for road and bridge grants. A county with a combined city and county government would have a different list of allowed uses, including its transportation department.