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(1 percent) and county transit districts (.25 percent).
The flip side of the equation is that consumers are being heavily pinched with every fill-up. Prices that were already
being pressured by worldwide demand received another jolt after Hurricane Katrina knocked several key Gulf Coast refineries
out of commission indefinitely.
At press time, it was uncertain what effect - if any - Hurricane Rita will have on the nation's petroleum supplies.
Consumers aren't the only ones forced to reconfigure spending plans by the spiraling prices. More expensive gas means
higher transportation costs for businesses. Although exempt from paying the sales tax, cash-strapped local governments find a
larger than expected share of their budgets is being used to fuel their vehicle fleets.
Several state leaders, including 17 Republican House members that have formed a Motor Fuel Task Force, are calling for a
temporary repeal of the sales tax on gasoline. Similar to a six-month suspension enacted in 2000 that saved consumers
approximately 10 cents per gallon, the move would provide some relief until prices return to normal. That's assuming, of
course, that consumers now consider paying two-something a gallon for gas as being "normal."
A sales tax repeal would not affect Illinois' 19-cent per gallon fuel tax, which is used specifically for road construction
projects. Michigan and Indiana, which also charge sales taxes on gasoline, are considering similar proposals.
State Sen. Frank Watson, a Republican from Greenville and the sponsor of the 2000 gas sales tax repeal, says its effects
were largely positive.
"Gas consumption went back up and even spiked along our borders, where residents had been buying less-costly gas from
neighboring states," he said.
After publicly entertaining the idea of suspending the gas tax in late August, Illinois Gov. Rod Blagojevich now argues
that a repeal would do more harm than good. And while he insists that the state needs every revenue stream it can get, no
specific plans for the extra revenue have been announced.
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Becky Carroll, spokeswoman for the state's Office of Management and Budget, says there is no guarantee that gas tax savings
from a repeal would be passed on to consumers.
"It's a challenge right now for the Illinois Attorney General's Office just to determine whether there's price gauging,"
she said. "It would be even more difficult to monitor where revenues from a temporary or permanent repeal would go. There was
no proof that the 2000 repeal's savings were actually passed on to consumers."
Carroll said the governor is reluctant to support a proposal that advocates taking a big slice of revenue from the state's
pie.
"Whenever there's a proposal to take revenue out of the budget, it could have a significant effect on our ability to
balance the budget," said Carroll. "Taking anticipated revenue out of our budget would only threaten to throw it out of
balance, and we don't want to revert to the situation of a $5 billion deficit, like when we (Blagojevich) came into office."
Advocates of a repeal counter that the state can't afford not to help consumers cope with the seemingly daily and hourly
gas price increases. Because Illinois families are already devoting 7 percent of their annual income on fuel, they predict
some difficult household spending decisions ahead - particularly with winter and the expected jump in heating prices on the
way.
The issue will likely come to a head when the state legislature returns to Springfield for its annual veto session in late
October. In the meantime, Motor Fuel Task Force members are conducting a series of six hearings across Illinois to share the
latest information on petroleum prices, discuss alternative ideas such as using made-in-Illinois alternative fuels and gather
constituent input.
Watson hopes to bring State Senate and House leaders together before the veto session in hopes of forging a viable,
bipartisan answer to the sales tax challenge.
"We want to discuss options for the tax as well as the revenue windfall," he said. "I'd like to see it go to road and
environmental remediation programs that the governor stripped from the budget."
Blagojevich's opposition to the repeal will likely exclude him from the discussions. "We need to talk about a legislative
solution to this issue so his office will not be involved," Watson said.
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