- Associated Press - Tuesday, May 20, 2014

WINDHAM, N.H. (AP) - Gov. Maggie Hassan signed a bill Tuesday that raises New Hampshire’s tax on gasoline and diesel by 4 cents per gallon, the first increase since 1991.

“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 Interstate 93 and improving commutes for our workers and visitors,” Hassan said in a news release.

The tax increase takes effect July 1. New Hampshire’s 18-cent tax is the lowest in New England and will remain the lowest with a 4-cent increase.

The bill increases funding for highway improvements for two years, then earmarks about half the proceeds to pay off $200 million in borrowing to finish the Interstate 93 expansion.

Once the debt is paid off in roughly 20 years, the tax increase would expire.

Hassan, a Democrat, noted that the bill was sponsored by Republican Sen. Jim Rausch of Derry and supported by a bipartisan group of lawmakers. It also was supported by the business community.

“A solid, modern transportation infrastructure is the foundation for long-term economic growth, critical to the success of New Hampshire’s people and businesses, and I am proud to sign this bipartisan legislation into law so that we can strengthen our transportation infrastructure and boost our economy,” said Hassan.

The conservative Americans for Prosperity said the tax increase will hurt motorists, especially at the start of the summer driving season.

“With gas prices at $3.61 for regular and diesel at $3.91 per gallon, the working families of New Hampshire are being crushed when they fill up their tanks,” said Greg Moore, the organization’s state director.