Bill would change the way vehicle excise tax is distributed

Politics - Government

SANTA FE, N.M. (KRQE) – New Mexico’s roads get a poor grade every year. Now there’s a push at the Roundhouse to use more of the state’s new car tax on roads.

A bipartisan House bill would shift the distribution of money from that tax and put more of it into roads all the way down to the local level. “We don’t have recurring revenues for our roads from the general fund. the motor vehicle excise tax in its original form was supposed to be that funding. But it reverted into the general fund so now we’re going to use that fund to basically fix our roads,” said Rep. Patricio Ruiloba of Albuquerque.

House Bill 220 makes major changes to the distribution of the state’s motor vehicle excise tax which is a 4% tax on cars sold in New Mexico.

The bill would cut what goes into the general fund by almost half and put more than 30% towards the state road fund, which is about ten times what goes into it now.

Lastly, it would undo the 25% earmark for roads in the oil patch in the southeastern part of New Mexico. That money would be used toward local government road projects to help fund city roads.

“We all drive so when you buy a vehicle, you drive on the roads, they wear and tear so you’ve got to pay for that so it makes sense but if it were up to me, I think more money should go towards roads and not the general fund,” said Rep. Tim Lewis of Rio Rancho.

The tax brings in roughly $200 million a year and that revenue is expected to go up in the next few years.

House Bill 220 has passed in one House committee and now its fate rests in the House Tax Revenue Committee. In the budget, lawmakers already set aside a one-time appropriation of $200 million for state roads.

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