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Sponsor asks committee to double gravel tax to 4¢ to help local roads and offset exemptions
Summary
Representative Tom Schamberg told the Ways and Means Committee that HB 11‑44 would raise the excavation (gravel) tax from 2¢ to 4¢ per cubic yard to align the statutory rate with inflation and offset local infrastructure costs; DRA urged an April 1, 2028 effective date to simplify administration.
Representative Tom Schamberg opened the public hearing on HB 11‑44 by describing the bill as a modest, locally retained adjustment to the excavation (gravel) tax that has not been updated since 1998.
"Under current law...excavated earth is exempt from property taxation and instead taxed at the time of removal at a rate of 2¢ per cubic yard," Schamberg said, arguing that inflation has eroded the tax’s value and municipalities bearing road and bridge upkeep deserve the modest revenue increase.
Schamberg provided a spreadsheet showing uneven local receipts and estimated that doubling the rate to 4¢ would increase annual statewide gravel tax revenue from roughly $250,000 to about $500,000. Municipal assessors and the Municipal Association testified in favor, saying the rate change would help offset infrastructure wear from heavy truck traffic without creating a new state tax or diverting revenue from municipalities.
Jim Michel, chief assessor for Hudson, said the town received $9,336 from the excavation tax in 2024 and that the proposed change would raise that to $18,672 — a small but direct contribution to municipal non‑property tax revenues.
Several lawmakers raised questions about the statute’s definitions (RSA 155‑E:1) and whether the bill would unintentionally sweep in ordinary soil removal or very small residential projects. Schamberg andMunicipal Association witnesses said the tax is typically triggered only for commercial excavation or sales of aggregate and that thresholds could be adjusted to avoid burdening small homeowners.
Jennifer Ramsey, tax policy counsel for the Department of Revenue Administration, asked the committee to align any effective date with the property tax year and recommended an April 1, 2028 effective date to avoid short‑year administrative processing.
The public hearing closed with committee members indicating interest in technical fixes: clarifying the statutory definition of ‘‘earth’’ and considering adjusting the threshold and indexing the rate to inflation.
What’s next: The committee closed the public hearing and signaled follow‑up work sessions to address definitional and administrative drafting questions before any recommendation.
