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When the State of California says a tax is handcuffed for transportation funding, do not believe them. They find a way around it…every time.
The latest grab is siphoning the diesel excise tax to pay for “green” aviation fuel. That is right. Green aviation fuel. And, yes, you are correct, planes do not use our roads and bridges, which is what the diesel excise tax is intended to fund.
How does this proposed scheme work? Governor Newsom’s budget allows fuel producers to reduce their diesel excise tax liability if they produce “green” aviation fuel. The outcome, according to UC Berkeley Energy Institute, would be a 20%-75% reduction in diesel excise taxes paid.
Not only that, but it would divert the feedstock used to produce biodiesel to aviation fuel instead. Biodiesel is widely used in California’s transportation network and significantly reduces tailpipe emissions.
This proposal is just a bad idea all the way around.