Proposals would funnel car tax money into roads

SANTA FE (KRQE) – Lawmakers are looking at several proposals this session that would increase spending on roads significantly by taking millions in motor vehicle excise taxes out of the general fund over the next few years.

Right now, New Mexico charges 3 percent on every vehicle sold, a tax that brings in an estimated $140 million per year. That money used to go towards road funds, but in the 1980’s and 1990’s it was shifted entirely towards the general fund, the state budget.

Four separate bills proposed this session would shift that money back into either the state road fund or a combination of the state road fund and local road fund.

“This extra $140 million could make a huge difference if we’re sending it to the municipal arterials and the county arterials at helping to fix these roads,” said Rep. Jason Harper, R-Rio Rancho, who’s carrying one of those bills.

But because this isn’t a tax hike but a shifting of money, that means the general fund budget would be short by that amount of money. Due to the state’s budget crunch, none of the four bills would move all of that money for the upcoming budget year, either phasing it in or delaying the shift.

A fiscal study of Harper’s bill for example, finds that the general fund would be short about $160 million in two years.

It’s that financial uncertainty in the budget that’s led the New Mexico Department of Transportation to be opposed to taking action on the idea this year.

“This is not the year to undertake such a large shift in revenue,” said Matt Kennicott, a spokesperson for NMDOT. “We will continue to be supportive of this concept and work to make changes to the funding stream when revenues to the state are in a more healthy position.”

House versions of the idea made some progress this session, but were tabled in committee on Tuesday.

A Senate version is still alive, but chances of it passing are slim given NMDOT’s position and the lack of remaining time in the session.

There is another bill in the Senate that would raise revenues by upping the state gas tax by five cents. That bill is even less likely to make it on the books this year. provides commenting to allow for constructive discussion on the stories we cover. In order to comment here, you acknowledge you have read and agreed to our Terms of Service. Users who violate these terms, including use of vulgar language or racial slurs, will be banned. Please be respectful of the opinions of others. If you see an inappropriate comment, please flag it for our moderators to review.

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