Missouri gas use hits four-year low

AARON EISENHAUER ~ aeisenhauer@semissourian.com Missourians are cutting back on driving because of high fuel prices. [Click to enlarge]

The publishing of a monthly report by the Missouri Department of Revenue showing that Missourians are cutting back on driving because of high fuel prices coincided Tuesday with the release of an environmental group's study showing the state is more vulnerable than most to cost increases at the pump.

Total sales of gasoline and diesel during the first six months of 2008 fell to the lowest level of any comparable period in the past four years, the revenue department report shows. As fuel prices peaked in June, consumption fell 3 percent compared to June 2007. Overall fuel consumption is down 1.83 percent for the year.

Missouri motorists used 1.9 billion gallons of gas and diesel in the first six months of the year, down from 2.03 billion gallons in the first half of 2007.

Declining consumption means falling revenue for the Missouri Department of Transportation's road projects as well as less funding for the road programs of local governments. Revenue from fuel sales was $338.7 million during the first six months of 2008, compared to $345.1 million in the same period of 2007.

Missourians pay 17 cents per gallon in state fuel taxes on gasoline and diesel.

The money is distributed to cities and counties through a complicated formula that takes into account miles of road and rural land values for counties and population for cities.

Cape Girardeau has received $669,255 since November from fuel tax distributions, down almost $7,500 from the year before.

Fixed accounting error

Putting a bigger strain on local budgets, however, is the revenue department's decision in November to cut local payments from vehicle sales taxes and license fees to make up for an accounting mistake dating to 2005. That decision has cost Cape Girardeau $114,000 in the fiscal year ending June 30. Other cities and counties in the area have also lost substantial funds, with Jackson losing $38,600, Scott City losing $25,900 and Cape Girardeau County losing $65,000.

Cape Girardeau budgets about 60 percent of the expected $1.5 million in state fuel and motor vehicle tax distributions for street maintenance. The rest is used for small street improvement projects, said John Richburg, finance director for the city. A shortfall in revenue will mean fewer small projects, not a reduction in street maintenance, he said. Major projects in Cape Girardeau are funded with a dedicated sales tax.

The loss of revenue "doesn't do anything to the street department, except we may not do a capital project that was planned on being done," Richburg said.

The environmental group study, prepared by David Gardiner & Associates LLC for the Natural Resources Defense Council, ranked Missouri as the state 15th most vulnerable to rising fuel prices. The study, called "Fighting Oil Addiction," also listed Missouri as the ninth-worst state when it comes to actions designed to reduce dependence on foreign oil.

In 2007, according to the report, Missourians on average spent 6 percent of their income, or about $2,064, on gasoline. That is the 15th-highest percentage and the 16th-highest dollar amount reported in the study. The most vulnerable state was Mississippi, where the average person spent 7.87 percent of income on gasoline, and the least vulnerable was Connecticut, where the average resident spent 3.17 percent of income on fuel.

The study's rankings for state action covered 11 measures in four categories from clean and efficient vehicles to research effort and incentives for clean fuels to support for efficient growth and mass transit. Of the measures, Missouri's ranking noted a single initiative, a state fleet efficiency program, and the 2.36 percent of transportation spending used for public transit.

"The report shows that when oil prices go up, families in some states are hit much harder than others because they are paying a greater percentage of their incomes at the gas pump," the Natural Resources Defense Council's transportation policy director, Deron Lovaas, said in a news release. "The good news is that some states are enacting policies that give consumers vehicle and transportation choices. But more states need to do the same, and federal policymakers must follow suit by boosting fuel economy standard, supporting a limit on global warming pollution and investing in more efficient transportation alternatives like commuter rail."

The report shows that 14 states have incentives for hybrid vehicle purchases, 29 states have incentives for fuel stations to install pumps for alternative fuels such as ethanol and 20 states have grant programs for research into more efficient cars and fuels.

rkeller@semissourian.com

335-6611, extension 126

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