WASHINGTON — Leadership from groups representing key sectors of the freight industry on March 6 urged the powerful tax-writing committee in the U.S. House of Representatives to approve a long-term funding system for the country’s network of freight and commuter corridors.
American Trucking Associations, the U.S. Chamber of Commerce, the AFL-CIO and the American Society of Civil Engineers were unified in their support before the Ways and Means committee for congressional action on raising revenue meant to ensure the sustainability of the dwindling account at the center of the infrastructure policy debate, the Highway Trust Fund.
Momentum appears to be building on Capitol Hill on a long-term infrastructure package, and policymakers kicked off the year by revisiting their conversations with executives, experts and nonfederal officials to gain input and insight on a legislative package. Senior lawmakers, as well as congressional observers, say a comprehensive measure has the potential of advancing as early as this summer.
At the hearing, ATA President Chris Spear proposed that Congress adopt a 20-cents-per-gallon fee on motor fuels. Collected at the wholesale rack, ATA’s Build America Fund proposal would be phased in over four years at 5 cents annually, Spear explained. He noted that in about 10 years the proposal would generate about $340 billion.
To boost infrastructure funding, ATA chief Chris Spear tells Ways and Means to consider Build America Fund (20 cents per gallon fee on motor fuels phased in over four years) pic.twitter.com/5z0T504YRf— Eugene Mulero (@eugenemulero) March 6, 2019
“We are no longer facing a future highway maintenance crisis, we’re living it; and every day we fail to invest we’re putting more lives at risk. In nearly 53% of the highway fatalities, the condition of the roadway contributed,” Spear said. “Federal inaction has prompted cash-strapped states to adopt regressive revenue schemes that hurt commuters, communities and divert funds to noninfrastructure priorities.”
Improving connectivity across freight corridors would significantly enhance regional economies, Spear emphasized. In 2016, congestion resulted in an annual cost to the trucking industry of $74.5 billion, the American Transportation Research Institute concluded.
The AFL-CIO, the Chamber of Commerce and ASCE endorsed directly increasing the Clinton White House-era taxes on fuel as an ideal approach for boosting the Highway Trust Fund.
“In the business community, some of the strongest proponents for a federal increase are those who would be most directly affected — the truckers,” Chamber of Commerce President Tom Donohue told the panel. “Claims that this can’t get done are simply false. We believe this is the simplest, most common-sense solution out there.”
ASCE explained a 5-cent increase in fuel taxes over five years would help bring the country’s infrastructure to a state of good repair. In 2017, the group gave the country’s overall network of bridges, tunnels, dams, transit, roads and railways a D+ grade.
“The federal government has historically been the leader in strengthening our surface transportation network,”said Gregory DiLoreto, speaking on behalf of ASCE. He is the group’s former president who currently chairs an infrastructure funding advocacy initiative for the organization. “The current user fee must be raised and tied to inflation to restore its purchasing power.”
ASCE also proposed establishing a national pilot program on a mileage-based user fee, as well as establishing a tax on electric vehicles.
Addressing the tax-writing panel in his role as leader of the House Transportation and Infrastructure Committee — which will craft the infrastructure bill for which Ways and Means would later devise a funding strategy — Chairman Peter DeFazio (D-Ore.) shot down alternative funding approaches, such as public-private partnerships, and promoted “real federal investment.” DeFazio said, “I hope that this [Ways and Means] committee will take substantial action to raise revenues.”
“You put up the money, it’ll get done.”
T&I Committee ranking Republican, Missouri Rep. Sam Graves, remains convinced a viable alternative to increasing fuel taxes is a vehicle-miles-traveled fee. A nationwide VMT pilot program is likely to hitch a ride in an infrastructure measure.
“If we’re going to spend that capital, we’ve got to focus on the long term,” Graves said. “A VMT [fee] has the potential to be a true user-funded program that captures everyone and gets the Highway Trust Fund back to where it needs to be to maintain our network and improve it. However, like any real solution, there are challenges. For instance, privacy is a big concern, and questions about whether or not VMT is fair to both rural and urban drivers have been raised.”
DeFazio (left) and Graves. (Office of Rep. Sam Graves/Suzanne Youngblood)
Ways and Means Chairman Richard Neal (D-Mass.) told the stakeholders that after meeting with senior administration officials, such as Transportation Secretary Elaine Chao, he is confident an infrastructure bill is capable of advancing in the near term. The tax-writing panel has yet to indicate when it intends to consider the legislation.
“I think we have a real opportunity here to work together and do something really big,” Neal said.
Analysts have estimated the trust fund, which assists states with transportation projects, will face insolvency in about two years. Revenue from the 24.4-cents-per-gallon diesel tax and 18.4-cents-per-gallon gas tax that backs the trust fund is insufficient to meet the account’s obligations. The taxes have not been raised since 1993. Republicans and Democrats have avoided voting on raising fuel taxes, citing possible retribution from voters.
More than half of states have raised their fuel taxes in response to federal inaction on a long-term infrastructure funding plan. President Donald Trump recently told a group of governors at the White House he would sign an infrastructure measure into law.