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Why Iowa needs an increase in the Road Use Tax Fund - A Student Perspective page banner

Why Iowa needs an increase in the Road Use Tax Fund - A Student Perspective

Posted on March 21, 2012 at 10:30 AM by Iowa Corn

 

First, a background on how this post came about. My name is Kate Greif. I am currently a student majoring in Agricultural Communications at Iowa State University. For one credit, I spent the week at the Iowa Corn Growers Association and the Iowa Corn Promotion Board job shadowing. The week included agency meetings, learning about staff, sales meetings, a radio station visit, a print media breakfast, lunch with an out of state farmer group, and an afternoon lobbying at the Iowa State Capitol.  I’ll be the first to admit, I have limited political awareness. And after an afternoon at the Capitol, I realized I have a lot to learn. 
 
Source
Prior to this experience, I thought lobbying was the political ‘black-market’ and issues like the fuel-tax were just another reason for costly gas prices. Naive, I know, but so true for many Iowans like me. However, just one day of lobbying (more like lobby-watching) allowed me to gain a much greater appreciation for the profession and their ability to communicate various issues.  Lobbyists continually represent the general population and communicate what we the people truly want
 
This thought brings me to the ‘fuel-tax’ or Iowa Road Use Tax Fund (RUTF). Seldom does our society enjoy the thought of taxes. Income taxes, property taxes, sales taxes. Taxes. Taxes. Taxes. The word alone brings about feelings of discontent or anxiety. However, sometimes we overlook the importance of these taxes in our daily lives, and the reasons that they are implemented in the first place.
 
During my job shadow experience, we were communicating on behalf of today’s Iowa corn farmers favoring an increasing in the Iowa Road Use Tax Fund. Farmers are highly dependent upon solid infrastructure for the production, transport, and sale of their goods. Unfortunately the ag-industry is at a productive disadvantage because of the present state of rural Iowa roadways and is encouraging a fuel-tax increase to improve these disparities. 
 
Sigh. Yes, another tax increase, but before jumping to conclusions, take a moment to consider what I learned “On the Hill” as it’s called at the Capitol. The RUTF increase is different from other tax increases because:
  1.  It not only affects Iowans’ pocketbooks, but is paid by all who travel and use our roadways. That includes visitors and businesses passing through Iowa. 
  2. And, the ‘gas-tax’ is a constitutionally protected fund, meaning the Iowa constitution guarantees fuel taxes will be used only for our roads. So, the money collected from the fund goes to building or repairing roadways!
 
I once learned in an introductory marketing course that building infrastructure is a primary step toward becoming a developed country or ‘market.’ Without infrastructure there would not be transportation, flow of goods, or flow of money. This all culminates into a lack of overall prosperity. Although this is a rather simplified generalization, it applies to the current condition of the roads and deteriorating infrastructure present in Iowa. Simply put, Iowa’s roads and bridges in many areas are in desperate need of improvement. The current funding for Iowa roads is not enough to fulfill the maintenance they demand. (Brief side note from Econ 101: If supply equals demand, a market is in equilibrium. If the supply is less than demand, the market is out of equilibrium. Our current road funding represents the supply in an out of equilibrium market).
 
The fuel-tax hasn’t been increased since 1989, when gas was still under $1.00/gallon, but sadly, when we were communicating the Iowa corn farmer’s position at the capital, legislators seemed to be hung up on one idea: I can’t vote for an increase in taxes. Many agreed that road conditions were in disrepair and something needed to be done. However their personal re-election and focus on the perception of the word, “tax” took priority over the actual issue at hand. It’s a fact that good infrastructure is a basic component to economic growth. I am a student in Agriculture and have lived in Iowa all my life. I am like most people and don’t necessarily want to pay more taxes, but when I understand that the financial burden is shared and we need to make improvements to keep our economy strong, I think it’s time to reconsider the Road Use Tax Fund as an economic necessity rather than just another tax-increase. 
 
Additional Reading: 
 

Kate Greif grew up on a family farm outside Monticello, Iowa. While growing up she was active in 4-H, FFA, and assisted with the family business, Prairieview Ag Service. She currently attends Iowa State University where she is majoring in Agricultural Communication with a minor in Business.  Kate has been showing Arabian Horses for 11 years and is pictured with her eight-year-old gelding, Jazz. 
 

 

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