Colorado Department of Transportation wants to impose a new fee on diesel fuel
Three and a half years after Gov. Jared Polis signed a bill enacting nearly $4 billion in new fees for roads and bridges, the Colorado Department of Transportation is asking for more fees.
CDOT Director Shoshana Lew asked the Joint Budget Committee to increase a fee drivers pay to the Bridge and Tunnel Enterprise by $8 per vehicle, saying the enterprise has drastically improved the condition of the state's bridges because its fees are designated solely for that purpose.
"One of the things that makes this source of funds different from all the others is that it's kind-of not in competition with anybody's policy priorities," Lew told the JBC.
Which is why she wants to start a new enterprise for road maintenance. It would be funded by an additional 3 cents a gallon fee on special fuels, including diesel, to generate $20 million a year. Right now, taxes and fees on diesel add up to about 25 cents a gallon in Colorado. The new enterprise would also receive revenue from a new fee on electric trucks that is yet-to-be-determined.
In exchange, CDOT says, it will lower a road safety surcharge -- or FASTER fee -- drivers pay by $11 a year, which would save the state about $65 million.
State Sen. Barb Kirkmeyer calls it a bait and switch.
"They're trying to make it look like, 'Oh, we're doing a great deal for folks by saying we're going to reduce your FASTER fee - you know your registration fees -- by 11 bucks -- but hey, we'll catch you on the back side,'" the Republican said.
She accused CDOT of lowering the surcharge simply to keep revenue below the Taxpayer Bill of Rights cap -- so the state doesn't have to issue taxpayer refunds -- and raising the two enterprise fees because they don't count toward the cap.
Kirkmeyer says the additional fee on diesel will not only impact the trucking industry but agriculture industry.
"It will impact freight movement across our state and our economy in a negative way. But the bottom line is, it will all get passed off on the consumers at some point," she said.
Instead of creating new fees, she says CDOT should look at redirecting some of the $500 million in fees it already collects.
"They need to just quite frankly prioritize," she said.
CDOT's overall budget is more than $2 billion. That doesn't include federal grants which added up to $250 million last year.
Kirkmeyer also raised concerns about a lack of transparency and accountability with enterprises, saying -- unlike state agencies -- enterprises don't report to the budget committee.
But CDOT says their budgets are posted online and their boards hold public hearings every month.
The legislature must approve any new enterprises or fees.
According to the state's chief economist, Colorado now has 35 enterprises. That includes everything from higher ed institutions to the lottery. Half of them have been created in the last seven years since Polis took office. Their revenue totaled just over $23 billion in 2022, which is the most recent year available. About $17 billion of that came from fees. The entire general fund, which is made-up of income, sales and use taxes, is $17.5 billion.
The new legislative session starts Jan. 8 and all agencies have been asked to make cuts with the state facing a $1.4 billion budget shortfall.
