Dan Walters: Steinberg’s gas tax proposal may be dead on arrival

dwalters@sacbee.comFebruary 20, 2014 

Darrell Steinberg, the president pro tem of the state Senate who will leave the position and the Legislature later this year, proposed Thursday that gasoline taxes be increased sharply to fight global warming and provide new financial support for low- and middle-income families.

But his plan could be dead on arrival, given the Capitol’s political dynamics and opposition from both left and right.

Steinberg, speaking to the Sacramento Press Club, offered the gas tax – about 15 cents a gallon and $3.6 billion a year to start and then rising over time – as an alternative to bringing the fuel industry under the state’s “cap-and-trade” fees aimed at lowering greenhouse gas emissions, now scheduled for 2015.

He argued that a “carbon tax” would be better because its effect on gasoline prices would be more predictable and its proceeds “will be used to alleviate the financial burden of carbon pricing among low- and middle-income families” with an earned income tax credit.

However, it’s already taking fire from environmentalists, such as the Environmental Defense Fund, as undermining the cap-and-trade program, and is certain to face opposition from Republicans, which would make it difficult for Steinberg to get the two-thirds votes in both legislative houses he would need.

Sen. Fran Pavley, D-Agoura Hills, who authored the cap-and-trade law, is a key critic, saying it would let oil companies off the hook and pass on costs to consumers.

This being an election year adds to Steinberg’s difficulty. While Democrats have two-thirds “supermajorities” in both legislative houses, their margins are very thin. Voting to raise consumers’ gas taxes – with the money not going to fix California’s deteriorating highway system – would be a very tough sell for some Democrats, especially several Assembly members facing tough re-election campaigns.

Even were he to overcome those hurdles, Steinberg would need a signature from Gov. Jerry Brown, who’ll also be running for re-election and has strongly indicated he doesn’t want to see any more tax hikes for a while.

Oh, and forget about a veto override.

By happenstance, too, Steinberg unveiled his tax proposal just as the state Chamber of Commerce announced that it would ask an appellate court to void the constitutionality of the cap-and-trade fees, contending that they are taxes that would have to be enacted by the Legislature, not the Air Resources Board.

Brown wants to use proceeds of the fees for, among other things, relieving impacts of the drought and shoring up the finances of his pet bullet-train project.

Meanwhile, some legislators are pushing another controversial bill to impose an extraction tax on California oil companies, which also could have the effect of raising gas prices for the state’s motorists.

It would be a minor miracle if Steinberg pulls this one off.

Call The Bee’s Dan Walters, (916) 321-1195. Back columns, www.sacbee.com/walters. Follow him on Twitter @WaltersBee.

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