WUD Opposes SB 1 – The Largest Fuel Tax Increase in California History

Modesto, Calif., (April 10, 2017) – Led by Governor Brown and legislative leadership, SB 1 was amended and ushered through the process to impose the single largest gas tax increase we have seen. The bill will generate $52 billion dollars over the next ten years to fund deferred maintenance on state highways, local streets and roads, and to improve trade corridors, transit and transportation facilities. SB 1 passed yesterday evening in the late hours earning the bare minimum of “aye” votes to secure a 2/3rds vote threshold needed to win approval.

Most impactful to our members is the bill’s tax on diesel fuel which starting on November 1, 2017:

  • Increase in the diesel excise tax by $0.20 per gallon
  • Increase in the diesel sales tax by 4% per gallon
  • Increase in the vehicle license fee between $25 – $175 annually based on the value of the vehicle

WUD communicated strongly to legislators the impact to the dairy industry. And, although this is not the outcome we had hoped for, we are proud of the opposition strategy we executed. With a targeted budget we engaged over 500,000 people on social media, generated 35,000 signed petitions, and drove 2,000 phone calls to legislative offices. WUD’s campaign successfully activated a base of people that we can energize again on future legislative/regulatory battles. This effort demonstrates yet again why elections matter and the need to continue to build our political strength as an industry.

Particularly relevant was the fact legislative democrats enjoy a 2/3rds supermajority in both houses of the Legislature which was earned in the 2016 election cycle. Given the political environment and leadership’s willingness to use that supermajority to pursue rather aggressive policies that impact animal agriculture is a reality WUD’s leadership must consider as we tackle priority issues – including water quality and short-lived climate pollutants – in the coming year.

SB 1 diesel fuel cost increase: 1000/head of cows = $30,000 annually 2000/head of cows = $60,000 annually 3000/head of cows = $90,000 annually

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