Why KY Gov. Beshear is turning to President Trump over pausing the gas tax
Democratic Gov. Andy Beshear is urging President Donald Trump to temporarily suspend or reduce the federal gas tax to protect Kentuckians from rising prices at the pump driven by conflict in the Middle East.
The suspension of the tax would cut prices by another almost $0.20 per gallon in addition to Beshear’s own $0.10 state gas tax cut that only a handful of municipalities are continuing to see; Lexington not being one of them.
The governor is turning to the president after he clashed with the Republican-led General Assembly over a difference in political will.
Beshear wants to give immediate relief to Kentucky’s drivers and legislators want to ensure long-term funding for the state’s transportation infrastructure — even if it means taking money from local communities that are still participating in the cut.
In a letter sent to Trump June 8, the governor encouraged the president to work toward a resolution in the conflict with Iran that would open the Strait of Hormuz and in the meantime, temporarily suspend the federal gas tax.
“Steps like this provide temporary relief to families who are feeling the pain at the pump, grocery store, and more,” the letter said.
“Unfortunately, members of your Republican Party in Kentucky’s General Assembly have opposed my efforts to save Kentuckians money at the pump,” the letter continued. “Some have even called it ‘political pandering.’ Given your similar efforts, I believe they are accusing you of the same. I would welcome any outreach you could make to Kentucky state legislators to encourage them to embrace a policy that you and I support.”
The conflict with Iran and gas prices
The conflict with Iran has escalated following a breakdown in negotiations over the country’s nuclear program. It has disrupted the flow of crude oil, a significant portion of which travels daily through the Strait of Hormuz. Since crude oil is globally traded, any interruption in the market causes prices to spike.
As of June 16, the average price of regular gas in Kentucky is $3.62 and diesel is $4.83, according to AAA.
Beshear signed an executive order in May to lower the gas tax starting in July. The order declared a state of emergency, something the Kentucky General Assembly has legislated to be an opt-in system after a month has gone by.
“In other words, I did not have the authority to do this statewide for another month. If I did, I would have done it and saved Kentuckians even more as gas is still too expensive,” Beshear said June 11.
“I don’t agree with President Trump on most things, but I agree that when families are suffering and the government can suck up and take a little bit of that to get through the toughest time, then we absolutely should,” the governor continued.
More than 30 communities across Kentucky successfully requested to extend the executive order June 9.
A spokesperson for Mayor Linda Gorton’s office told the Herald-Leader that Lexington did not put in a request because legislators said they did not know where the money would come from to make up for losses from the extension.
How Kentucky’s gas tax works
In Kentucky, the gas tax is managed by the state so it can maintain and construct major highways and other state-run roadways. Another portion of it is distributed back to cities to help pave local and secondary roads in addition to supporting infrastructure maintenance.
The state Transportation Cabinet estimated June 2 the state’s road project fund lost approximately $26.8 million in the month following the executive order.
Beshear said losses could be made up through dipping into the flush rainy day fund, but Republican lawmakers at the Interim Transportation Committee threatened to take road funding from local governments that continued to participate in the reduction past the first month.
“Localities are already struggling across the board to keep up with road maintenance and repairs, so this clearly becomes a no win situation,” the city spokesperson said. “Fayette County received several projects in the road plan last session, and this could put that funding in jeopardy.”
Push back against Beshear’s gas tax cut
Attorney General Russell Coleman, in addition to legislators, was critical of the governor’s push for cutting the state gas tax since Beshear has “vetoed almost every tax cut that’s come to his desk.”
“Now, he’s just playing politics and running for president,” Coleman said in a previous statement. “Kentuckians stand with President Trump, and they’re not buying what the governor is selling.”
Beshear earlier this month said it was legislators who had made the issue political when they threatened communities that had decided to extend the emergency order. In his letter told Trump about the pandering accusations because he believed they were being made about the president, too.
“Kentucky families are the ones that pay the price for those political games and the prices are going to continue,” he said last week.
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