Friday, October 24th, 2014
False
Club for Growth
When the New Hampshire Legislature raised the gasoline tax, gas prices in the state were "skyrocketing."

Club for Growth on Monday, July 21st, 2014 in a campaign ad

Club for Growth says N.H. gas tax enacted when prices were 'skyrocketing'

In this ad, the Club for Growth said New Hampshire gasoline prices were "skyrocketing" when a new gas tax was enacted. Is that correct?
Here is a chart of the past three years of gasoline prices in New Hampshire, according to gasbuddy.com...
... and here's a closeup of the period between when the New Hampshire gas tax hike was introduced and signed. Total increase: from $3.42 to $3.61, a 6 percent increase.

New Hampshire voters are famously unenthusiastic about tax hikes, so it’s no surprise that the Club for Growth, a fiscally conservative group, is making hay of the state’s recent gasoline tax hike in an ad that’s intended to bolster a Republican congressional candidate.

The ad -- part of what the group is calling a "six-figure" television buy -- aims to "thank" GOP state Rep. Marilinda Garcia for opposing higher taxes and spending in the Legislature. Garcia is running in the Sept. 9 Republican primary for a U.S. House race. The 2nd district seat, representing the western half of the state, is currently held by Democrat Ann McLane Kuster.

Here’s the ad’s narration:

"Across New Hampshire, taxes are going up, and families are hurting. With gas prices skyrocketing, the Legislature raised our gas tax. State budgets are growing by hundreds of millions. What’s next, an income tax? One representative has taken the lead to say no -- Marilinda Garcia. She knows government has gotten too big. Conservative Marilinda Garcia is fighting for more freedom and less government. Thank Marilinda for opposing higher taxes and spending."

When we looked into it, we found that the Club for Growth’s claim that prices were "skyrocketing" isn’t supported by the data.

A little background: Democratic Gov. Maggie Hassan signed the tax increase into law on May 20, 2014, after the Democratic-controlled state House and the Republican-controlled state Senate passed the measure.

It added 4.2 cents in tax to each gallon of gasoline sold, effective July 1, 2014. The proceeds -- an estimated $32 million annually -- are to be spent on road and infrastructure projects, including the widening of Interstate 93. The tax hike marks the first time the state has raised the gas tax since 1991.

The bill that became the gas tax hike was introduced in the state Senate on Jan. 8, 2014. (It was introduced in the House later.) So we looked at how the state’s gasoline prices moved between Jan. 8 and May 20, when Hassan signed the measure.

According to gasbuddy.com, a website that tracks gasoline prices in a wide range of states and cities, New Hampshire gasoline prices were $3.42 around Jan. 8 and rose to $3.61 around May 20. That’s an increase of 6 percent -- rising, but not exactly "skyrocketing."

And gas prices haven't skyrocketed since Hassan signed the bill, either. Between the bill signing and the effective date of the increase, gas prices in New Hampshire rose from $3.61 to $3.68. Then, since July 1 they've fallen, from $3.68 to $3.55.

If you take an even longer view, the term "skyrocketing" becomes even less apt. For a significant portion of the previous three years, gas prices were higher than they were when the bill was signed on May 20, 2014, peaking at $3.91 in September 2012. Smaller spikes, each higher than $3.69 a gallon, occurred in July 2011, April 2012, February 2013 and July 2013.

The same general pattern holds region-wide. Data from the federal Energy Information Administration shows that gas prices in New England as a whole rose from $3.63 when the bill was introduced to $3.80 when it was signed -- an increase of 5 percent, or well short of "skyrocketing."

According to the American Automobile Association, seeing a rise in gas prices on this scale is typical for the period from January to May. Gas prices usually are cheapest in the winter because people drive less, reducing gasoline demand. Prices generally rise through the spring, when refineries conduct maintenance between peak demand for heating oil in the winter and gasoline in the summer, among other reasons.

"It can be a shock to see prices rise significantly in the springtime, and no one wants to pay more for the same product," said Michael Green, a spokesman for AAA’s national office. "With that in mind, it is understandable why consumers might feel that gas prices are skyrocketing at times." But Green said it’s important to keep some context in mind. "Every year, someone could say that gas prices are ‘skyrocketing’ by comparing Jan. 1 to May 20," he said. "But that comparison would only tell a small part of the story."

The rest of the story is that gasoline prices have actually been coming down modestly in recent years, Green said.

In New Hampshire, the average price of gas on May 20, 2014, was lower than it was on that date in 2011 ($3.90) and 2012 ($3.70) and was only a little higher than it was on that date in 2013 ($3.46), Green said.

"The most important trend we see is that gas prices are a little less expensive than in recent years due to the recent boom in North American crude oil production," he said. "Consumers are not saving huge amounts of money, but prices absolutely are not ‘skyrocketing’ higher when compared to previous years."

For what it’s worth, a July 2014 survey by the University of New Hampshire found that, as a whole, New Hampshire voters support the gas tax increase. In all, 52 percent said they favor it, compared to 40 percent who said they opposed it.

Unlike Democrats and independents, Republicans -- the direct target of the ad, since Garcia must win the GOP primary -- narrowly opposed the hike (43 percent in favor, 47 percent against). Self-described conservatives were the most negative about it (36 percent in favor, 60 percent opposed).

The Club for Growth did not return an inquiry for this article.

Our ruling

The Club for Growth ad said the New Hampshire legislature raised the gasoline tax at a time when gas prices in the state were "skyrocketing."

Gas prices in New Hampshire rose modestly -- about 5 percent -- between the bill’s introduction and its signing, mostly, experts say, because of cyclical increases related to refinery maintenance and other reasons. Not only is that short of "skyrocketing," but the price of gasoline at the time the bill was signed was actually lower than it had been at multiple points over the previous three years. We rate the claim False.