A pervasive public outcry by taxpayers in Connecticut has resulted in Gov. Ned Lamont’s (D) acknowledgment that his state will back out of the controversial Transportation Climate Initiative (TCI), a cap and trade policy that many citizens asserted was simply another tax in an already over-taxed state.
“The leadership was very clear. Really all the leadership — Republicans and Democrats alike — in saying that they didn’t have the votes to get TCI done,” Lamont admitted to NBC Connecticut Friday.
As the Boston Herald reported Monday, Connecticut is now the tenth state to back out of the regional TCI that has been promoted by Massachusetts Gov. Charlie Baker (R) as a means to limit carbon pollution by mandating that fuel companies exceeding emissions caps purchase permits. The fees collected from the permit sales would supposedly then be invested in “green” transportation infrastructure.
In December, only Massachusetts, Rhode Island, Connecticut, and Washington, DC, signed the compact that originally touted 13 supporting jurisdictions from Maine to Virginia in 2019.
Lamont referred to TCI as “a win for all of us” when he signed onto TCI in the winter, but he abandoned the initiative as he struggled with budget negotiations Friday prior to the end of the legislation session.
“This provides real revenues for us,” he said. “This provides revenue for us to provide free bus services on the weekend. Get you out of those cars make it easy for that kid to get to the beach make it easy for you to get to the museum easier to buy groceries so you don’t have to take two bus stops to get to.”
Grassroots taxpayers and the fuel industry, however, pushed back on TCI, labeling it yet another “tax.”
State officials admitted gas prices would likely be about five to nine cents per gallon higher in 2023 when TCI becomes active.
As WTNH News reported in March, AAA Northeast already noted a 25 cents per gallon increase in gasoline within that month.
Connecticut residents currently pay three taxes on each gallon of gasoline: federal excise tax, state excise tax, and petroleum gross earnings tax. TCI would have added a fourth tax.
Chris Herb, president of Connecticut Energy Marketers Association (CEMA), a trade organization that represents fuel distributors, gas stations, and convenience stores, warned in an op-ed at CT Mirror Friday that TCI would result in “gasoline and diesel fuel shortages in Connecticut, Massachusetts and Rhode Island, because under the agreement, states would be required to reduce the amount of fuel that could be sold every year.”
Herb predicted that Connecticut would experience a “staggering” fuel shortage by 2026, with a 41 million gallon shortage by that year and more than 360 million gallons by 2032.
The CEMA president continued:
TCI would reduce fuel supply by 30% over 10 years while the Federal Government shows only a 6.32% decline in demand over the same period.
Supporters of TCI are banking on the idea that more people will work from home, take the bus, or buy electric vehicles, but the Federal Government states that the transition to EVs will be slow. Just hoping more people work from home is not a solid plan. We could see long lines at the pumps like we saw in the 1970s, or gasoline hoarding like we just recently saw in the southeastern part of the country.
Republican lawmakers have strongly opposed TCI.
“Anytime the government puts its hand in the people’s wallet it’s a tax,” said Senate Republican Leader Kevin Kelly, noted NBC Connecticut.
Similarly, House Minority Leader Vincent Candelora (R) said, “This is not about environmental policies, this is about pickpocketing the residents of Connecticut.”
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