The North Carolina House and Senate’s proposed fiscal year 2022-23 budget would provide more than $625 million annually in transportation revenue by 2025.
Funding would be through a percentage of sales tax revenue that would be divided between the Highway Fund and the Highway Trust Fund. It would start at 2 percent in fiscal year 2023, increase to 4 percent in 2024 and remain at 6 percent starting in 2025.
This is not a tax increase. The state collects more than $500 million annually in auto-related sales tax for the General Fund. This tax comes from the sale of auto supplies, tires, and from repair shops.
The funding will allow the state to address population growth and aging infrastructure.
NC Go, an organization supporting efforts to improve transportation funding and infrastructure, approves of the budget proposal but believes more can be done.
The “Motor Fuels Tax will not be a sustainable source of revenue in the future, with more hybrid and electric vehicles on our roads – and with vehicle fuel-efficiency increasing overall. Inflation is driving up the costs for asphalt, diesel fuel, concrete, steel AND labor – and is busting transportation project budgets,” Charles Hodges, NC Go! executive director, said in a statement.