The Gas Tax: How it came to be

Ken Holmlund
Tuesday, December 3, 2019
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HD 38

One of the most difficult votes I have had to take in the three sessions I have served in the Montana Legislature was the vote to increase gas tax. I generally do not favor increasing taxes on anyone when there are other avenues to accomplish the same goal- like cutting expenses or combining resources from several state departments.

When the issue of a gas tax increase began to gain a strong foothold in the legislature it was propose as a 10 cent a gallon increase, in large part to benefit cities and towns. My feeling was that a tax increase of that level would be difficult to defend. I expressed my feeling and volunteered to be on a committee to work out the details of a possible increase bill.

The committee was a bipartisan group including legislative staff and our legal department. The committee was headed up by Representative Frank Garner from Kalispell, a gentleman who was not adverse to carrying difficult legislation.

During the early part of the 2017 session the committee met twice a week and hammered out what would become the corpus of the bill. The tax as reduced to 4 ½ cents a gallon walking up to 6 cents over five years.

The next step was to involve several House and Senate members, including leadership, for their input. With a bill of this importance it is critical to get bipartisan support and involvement.

The bill that came to the floor was HB 473 and can be found in its entirety on if you care to read it. Some of the unique parts to the bill included: the funds can only be used for roads and bridges, the funds were divided in three pots- 35% to the Montana Department of Transportation, 68% of the remainder went to cities and 32% went to counties, any city or county wanting to access the funds allocated to them would have to have a 5% match, an audit would be conducted on MDT and a website that reported how the funds were allocated and used was required. The funds received from HB 473 had to be accounted for separately from the funds currently being received from previous gas taxes.

After all the main committee hearings where the general public was asked to give input, the bill made it to the floor of the House. As expected, the bill had several detractors and the discussion was robust to say the least. On March 23rd a vote, called second reading was held and the bill passed 56 to

44. Since the bill included more than $150,000 in tax dollars, it is required to go to Approps. Once again a public hearing was held and the bill passed 12 to 10. Back to the floor for more discussion and a third reading vote. On March 29 the vote was taken and passed 56-44. I include this lengthy discourse to illustrate how close the vote was in the House. The bill passed the Senate with similar results and went to the Governor’s desk where it was signed into law.

Now that I have bored you to tears with the process a second article will follow that discusses my reasoning for my vote and how it has benefited Eastern Montana.

(Ken Holmlund of Miles City represents House District 38.)