Monday, November 30, 2009

N.C. gas taxes being drained by corporate leakers

Posted By on Mon, Nov 30, 2009 at 1:21 PM

People complain about the price of gas but rarely remember to include gas taxes in their rants -- and they should, since those taxes make up a significant percentage of the price tag.

So, what is that tax revenue being used for? You're not going to like this ...

North Carolina is struggling to find money to clean up thousands of underground tanks that are leaking gas and oil into the dirt and water.

As a result, a new state report says it is time for businesses with such tanks to buy insurance to cover the costs of any cleanup.

North Carolina has spent more than $441 million to clean up pollution from private tank leaks since it set up a fund in the late 1980s to cover such expenses. But the state has a backlog of more than 6,500 locations that will take another 25 years to get to, according to a report from the program evaluation office at the state legislature.

The state fund is filled by tax revenue from fuel excise and inspection taxes and yearly fees on commercial tanks. But legislators have routinely had to step in to pump up the fund. In 2004, North Carolina enacted a one-year increase in the motor fuel excise tax to raise $30 million to cover claims. A few years later, legislators increased the fee for tank owners.

But the increases have not made much of a dent in the backlog, which will cost an estimated $513 million to clear.

Environmental groups say it is time for gas stations and other commercial tank owners to take more responsibility for leaking tanks.

"North Carolina should get out of the business of being the insurance company for any new tanks," said Molly Diggins, head of the North Carolina chapter of the Sierra Club.

Read more from the Raleigh News and Observer here.

In case you've forgotten, state rule makers are looking for new ways to tax driving ... by the mile:

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