North Carolina governor signs bill to lower gas tax

North Carolina Gov. Pat McCrory signed legislation on Tuesday that will immediately lower the state's gas tax as part of a finance plan that will steady revenue needed for the state’s transportation projects.

“This bill will allow us to build roads, strengthen bridges and fix potholes so people can get to their jobs, go to school, see their doctors, and drive to the mountains or the beach," McCrory said. “We now have a gas tax that is based on North Carolina's transportation needs instead of the unpredictability of the world oil market."

Effective on Wednesday, the bill reduced the state tax motorists currently pay on a gallon of gasoline from 37.5 cents to 36 cents. On Jan. 1, 2016, the gas tax will be reduced to 35 cents and drop to 34 cents on July 1, 2016.

After Jan. 1, 2017, the gas tax will be calculated on a formula with a 34 cents per gallon base price plus calculations taken from the Consumer Price Index and the state’s change in population. The state’s gas tax was previously based on the fluctuating international wholesale price of crude oil.

The new gas taxes will force the North Carolina Department of Transportation to reduce its budget by $13.5 million and eliminate 40 positions.