The Colorado Department of Transportation (CDOT) is facing a significant budget shortfall and is now proposing a new fee on diesel fuel to address infrastructure needs.
With a $1.4 billion budget gap, CDOT is looking for new ways to raise revenue for road maintenance and bridge improvements.
Colorado's Push for New Diesel Fee
CDOT is proposing a 3-cent per gallon fee on diesel fuel, which is expected to generate about $20 million annually.
This fee would also apply to electric trucks, adding another revenue stream to fund a new road maintenance enterprise.
Currently, taxes and fees on diesel in Colorado add up to 25 cents per gallon, but CDOT argues that this additional fee is necessary to keep up with road upkeep demands and improve bridge conditions across the state.
Balancing Fees and Budget Concerns
In an effort to balance the proposed diesel fee, CDOT plans to reduce the FASTER fee—an existing road safety surcharge—by $11 per vehicle.
This change is intended to offset the impact of the new diesel fee on drivers.
Critics, however, argue that these adjustments are a strategic move to avoid breaching the Taxpayer Bill of Rights cap, which could trigger taxpayer refunds.
With a looming $1.4 billion budget shortfall, the state is looking at cuts across all agencies, making revenue generation through new fees a key priority.
Impact on Industries and Transparency Issues
The additional diesel fee could have a noticeable impact on industries such as trucking and agriculture, which rely heavily on diesel fuel.
The trucking industry, for example, could see increased costs passed down to consumers.
CDOT’s $2 billion budget includes $500 million in fees collected currently, with an additional $250 million from federal grants.
There are growing concerns about transparency and accountability within CDOT’s enterprise funds, which do not report directly to the legislature.
Critics argue that these funds should be more accountable, especially as they continue to grow in size and scope.
