WINDHAM – Gov. Maggie Hassan signed the first increase in the state’s tax on gasoline in 21 years on Tuesday, saying it would finish the state’s top highway priority, create jobs, and repair ailing local and state infrastructure – as well as eliminate one of the three exit toll plazas that Merrimack residents have resented for nearly that long.

“Our bipartisan transportation funding bill is the most significant state-level investment in transportation infrastructure in 23 years,” Hassan said. “This legislation is an important step toward addressing our transportation needs, keeping New Hampshire’s economy moving forward by advancing critical road and bridge projects, finishing the long-overdue expansion of I-93 and improving commutes for our workers and visitors.”

The final agreement also gives some modest toll relief to Merrimack residents. Retiring Sen. Peter Bragdon, R-Milford, convinced colleagues to attach to the gas tax increase the taking down of exit ramp tolls south and northbound at Exit 12 (Bedford Road) on the F.E. Everett Turnpike. State officials agree that increased traffic to the Merrimack Premium Outlets will more than offset the loss in revenue by shutting down the exit ramp toll.

Business owners near the exit praised the move after the legislature passed the bill in April.

“It’s about time they got rid of them,” said JoAnn Costa, the owner of Axel’s Food and Ice Cream in Merrimack, about 11?2 miles from the highway exit. “The tolls are unfair to the people in Merrimack, and they hurt our business.”

But on Tuesday, critics turned out in protest at what they said would add to the crushing burden residents already face with high food and energy prices. Activists with the fiscally conservative Americans for Prosperity and Citizens for a Strong New Hampshire turned out with signs that read, “Maggie Hassan = Higher Taxes” and “Gas Tax Bad 4 NH Business.”

“Right now, working families can’t afford a 23 percent increase in the gas tax,” said Greg Moore, AFP’s state director. “It’s unconscionable, and it still doesn’t solve the problem.”

Hassan, a first-term Democrat, chose to sign the long-awaited bill, SB 367, into law in front of a bridge under construction just off Interstate 93 near Exit 3.

Advocates fought for the tax increase principally to fill a $250 million hole in the budget to widen I-93 from Salem to Manchester. Hassan said business leaders constantly ask her when lawmakers were going to come up with the money to finish the project, 30 years in the talking stages.

“I-93 is the main artery to New Hampshire’s economy,” said state Rep. David Campbell, D-Nashua and chairman of the House Public Works and Highways Committee.

Sen. Jim Rausch, R-Derry, came up with the way to turn the Republican-led state Senate in 2013 from a group that blocked a larger hike to the one that embrace his plan, 14-9, last month.

The proposal makes a one-time adjustment in the tax, currently 18 cents a gallon, to fall in line with the rising cost of living over the last decade.

The change raises the tax to 22.2 cents.

After the bonds to finish the I-93 widening ends in 20 years, the tax increase is scheduled to go away.

Rausch called upon federal officials to approve environmental permits needed at the southern end of the last widening section and also at a new Exit 4A designed to give access to undeveloped, industrial land in Londonderry near the Manchester-Boston Regional Airport.

“We now have the resources; now give us the permits,” Rausch said.

Perhaps appropriately, Campbell and Rausch will retire from the Legislature this fall after each working more than a decade apiece to try to get more revenue for road and bridge work.

Transportation Commissioner Chris Clement said his staff started later Tuesday preparing work to competitively bid the next phase of local and state projects that can be done with the extra money – about $30 million a year.

“We are ready to go this week advertising contracts to do an additional 210 miles of paving this summer,” Clement said.

Hassan’s predecessor, former Gov. John Lynch, also a Democrat, threatened to veto a gas tax increase in three of his four successful campaigns for governor.

That’s why the Legislature under either Republican or Democratic control never sent Lynch such an increase.

In February, Hassan praised Rausch for making this renewed effort and a few weeks later confirmed she would sign the bill into law if it got to her.

Republican candidate for governor Walter Havenstein, of Alton, said this is the wrong time to approve a gas tax increase. Havenstein said the I-93 job needs to be redone and he would have found ways to reset transportation priorities to finish the work.

“I have been clear about my opposition to increasing the gas tax. Raising the gas tax in a stagnant economy would make a bad problem worse,” Havenstein said.

Campbell said gas prices will go up this weekend because of the Memorial Day weekend, but market cost for crude oil and supply and demand will set prices at the pump, not a 4.2-cent increase.

“New Hampshire has the lowest fuel charge of any state in New England, and every single dollar from this increase goes for road and bridge work,” Campbell said.

The I-93 project will get 42 percent of proceeds from the increase, a third of it goes for local highway improvements, and another 25 percent will be spent on state-maintained secondary roads.

Kevin Landrigan can reached at
321-7040 or klandrigan@nashua
telegraph.com. Also, follow Landrigan on Twitter (@Klandrigan).