Critics call for tax cap, new vote as Washoe County fuel tax goes up July 1

Like the sun rising in the east, one thing that’s sure to happen every July 1 in Washoe County is an increase in fuel taxes.

This year, the fuel tax will go up by about 3.3 cents per gallon as part of the RTC-5 fuel tax, which gets its name from the Regional Transportation Commission of Washoe County.

The increase will push the total tax on a gallon of gas from RTC-5 past the 50-cent mark for the first time to 50.4 cents.

Folks wondering who's responsible for this annual markup might find the culprit by looking in the mirror. Washoe County voters approved fuel tax indexing — twice — to fund transportation projects and road improvements. The approval of fuel tax indexing by voters in 2008 and the Nevada Legislature in 2009 meant that the fuel tax automatically increased every year using a 10-year rolling average for inflation.

Driving out of Washoe County to fill up: Does it make financial sense?

The revenue generated by the RTC-5 fuel tax is sizable.

In 2023, RTC Washoe estimated that the fuel tax will fund more than $558 million in roadway improvements over the next five years. The fuel tax is also the main local funding source for about $5 billion worth of roadway improvements planned in the next 30 years.

The funding was called crucial by RTC, ensuring that “important transportation projects will be built here in Washoe County.”

But with locals feeling the pinch from high gas prices plus inflation at the grocery store, a fuel tax increase is seen with trepidation today.

“Consumers are not happy with the price of gas,” said Sarah Collins, a spokesperson for the Nevada Petroleum Marketers & Convenience Store Association. “It’s no secret. They don’t like it.”

The fact that Washoe County has one of the highest fuel prices in a state where gas already costs more than the national average doesn’t help.

The national average for a gallon of regular gas as of June 27 is $3.503, according to AAA. In Nevada, the state average for the same gallon of gas is $4.042.

What about Washoe County, you ask?

The average price for a gallon of gas in Washoe is $4.629. Only Mineral County has more expensive gas in the state at $4.749 per gallon.

Meanwhile, a gallon of gas in Carson City just south of Reno is 84 cents cheaper than Washoe at $3.787 per gallon.

Jeff Church, an advocate with Reno Tax Revolt, called the difference ludicrous given that the fuel for both places comes from the same sources. Church attributed the large gap to higher taxes in Washoe County.

Church is also one of those vehicle owners who make the drive to Carson City to get gas because of the price difference.

“We go play some slots down there, go to thrift stores,” said Church, who is also a trustee on the Washoe County School Board. “I have friends there who I have lunch with. We go down there and make an event out of it. And all that money goes to Carson.”

At the same time, Church said he is not asking for the tax to be eliminated. What he does want to see is a cap on the tax so it doesn’t increase by nearly 8 cents in just two years.

Others want the fuel tax issue to be sent back to the voters.

“We’ve been at this for 14 years and I don’t think there are outcomes you can point to that we have a safer road network or one that is working more efficiently or better repaired,” said Reno City Councilwoman Jenny Brekhus.

“Going forward, I think the voters should repeal this because you’ve to two senators (Jacky Rosen and Catherine Cortez Masto) and Congressman (Mark) Amodei who want to create a lot of land available for sprawl development, and those of us who pay at the pump will be on the hook for that with new roads.”

RTC Washoe, meanwhile, pointed to projects such as the Southeast Connector, Pyramid/McCarran Intersection Improvement Project, 4th Street/Prater Way Project, and the Virginia Street Project as transportation initiatives that received funding from the fuel tax.

The agency added that repealing the RTC-5 fuel surcharge is a complex issue that is easier said than done. Such a move would involve multiple government entities and also raise various legal questions.

Although RTC receives federal funding, it is not enough to keep up with the area’s growing transportation demands, according to the agency.

The Nevada Petroleum Marketers & Convenience Store Association also mentioned one more factor that complicates any effort to repeal the fuel tax. The tax is actually tied to bonds.

In fact, the fuel tax has already been pledged as security for $312 million in outstanding bonds that must be repaid, according to RTC.

Those bonds mean that Washoe County will need to have fuel indexing on the books for several more years, Collins said.

“Our roads are bonded so it’s almost like a credit card,” Collin said. “We’re in debt for that credit card for a minimum of 15 years.”

This article originally appeared on Reno Gazette Journal: Critics call for tax cap, new vote as Washoe County fuel tax goes up July 1