In tonight’s speech will the Governor reveal how Pilot Oil could make millions off the gas tax increase?
So far, the arguments we have heard on why the state needs a gas tax increase all ring hollow:
“We need more money for roads.”
Ahem, we currently have $2 billion in surplus taxes squeezed out of Tennesseans. When you run through that, Governor, get back to us.
“We have $6 billion in unfunded projects.”
Really? Says who? The transportation bureaucrats and their allies in the road building industry? If your toddler sees a box of cookies and you ask him how many he wants and he says “all of them,” would you give him the whole box? Of course not. The crew here at Rocky Top all think we need bigger and nicer houses, but we lack the necessary funds. All told it comes to about $4,000,000 in our personal “unfunded projects.” See how easy it is to pull a meaningless number out of your butt? Nice try, guys.
“We need a more stable revenue stream to fund transportation.”
Yeah, that is the same load of bull we heard when Haslam’s father was pushing for a state income tax 15 years ago. The argument then was “the sales tax system will not be able to keep up.” Well that “antiquated and insufficient” sales tax system just produced a $2 billion surplus.
And as background to all of this, don’t you find it curious the Governor is making a mad push to get the gas tax through, even though President (choke on it) Trump has announce he is going for a huge national investment in infrastructure? Wouldn’t it be prudent to wait until we can see how much Tennessee might get in that proposal before we rush out and raise taxes?
So what’s really going on here? All the above arguments are pretty damning against the gas tax. Could there be another reason why Bill Haslam is so hell bent and jamming his tax down our gas tanks?
Here is potentially how it would work to the Haslam family’s financial favor (we inserted “potentially” because our lawyers wanted us to. It is our personal belief that this is exactly how it could go down.) Here are two ways Pilot could make a bunch of moolah off the gas tax increase — and it would all be legal:
Play the Float
The gas tax will be collected at the pump. Pilot is the largest distributor of diesel fuel in the state. They will collect the taxes for every gallon of fuel pumped for the state, every minute of every day. Annually, that could come to tens if not hundreds of millions of dollars collected by Pilot for the state. BUT, Pilot only has to remit those taxes every 90 days (quarterly). That means they would have access to millions of dollars to “play the float” making money of the interest while out tax dollars sit in their bank account. That could result in millions in easy money for Pilot Oil.
Pad the Balance Sheet
For as long as the tax money stays in Pilot’s state tax escrow account each quarter, the millions they collect can legally be added to the company’s daily balance sheet. And that means their accounts look even better when they go to financial institutions for loans, more favorable terms, etc. In other words, they can use our tax money to make their books more attractive and help make them money in the process.
Is this what will happen? Could Pilot actually do this? Did they rip-off truckers for millions with fraudulent “manual rebates” that landed them in Federal court?
Can’t wait for the speech.