Nearly a dozen stakeholders representing local governments and the freight and commuter sectors on Feb. 7 urged a House transportation panel to identify a sustainable source of funding for an infrastructure bill.
As the panel prepares to craft legislation, lawmakers agreed infrastructure policy should top their priorities this year. Yet, they continue to differ on a way forward for ensuring the sustainability of the dwindling Highway Trust Fund.
The idea that former Transportation Secretary Ray LaHood told the Transportation and Infrastructure Committee to consider is increasing and indexing the fuel tax by about 10 cents. Doing so, LaHood argued, would bring immediate revenue into the trust fund while other funding alternatives, such as tolls, gain greater acceptance.
Such an increase would need to be signed off by the tax-writing Ways and Means panel. Funding authority for transportation programs expires in the fall of 2020.
“All over America there are potholes. And you can only do so much by continuing to fill potholes year in and year out. The interstates are crumbling,” LaHood said. “You can’t fix America’s problems with infrastructure with just tolling, with just [vehicle miles traveled], with just public-private partnerships. You have to create a big pot of money.”
Minnesota Gov. Tim Walz (D) and Los Angeles Mayor Eric Garcetti (D) agreed the fuel tax merits inclusion in an infrastructure measure. They also stressed the legislation should reflect advancements in smart technology and projects capable of withstanding the force of extreme weather events.
Speaking on behalf of the U.S. Chamber of Commerce, UPS Freight President Rich McArdle emphasized a sense of urgency, noting that traffic congestion along corridors hinders the movement of freight. The chamber consistently has advocated for a fuel tax increase.
“Will this be the Congress that stabilizes the Highway Trust Fund, which has been underfunded for more than a decade or will the can be kicked down the road one more time?” McArdle asked. UPS Inc. is the top company on the Transport Topics Top 100 list of the largest for-hire carriers in North America.
Since taking over the committee in January, Chairman Peter DeFazio (D-Ore.) has been clear about his desire to advance an infrastructure measure this summer. He called on Republicans and President Donald Trump to help craft a bipartisan, long-term infrastructure bill. Thus far, the chairman seems set on a bill that would look to new revenues as a primary approach for addressing the looming funding crisis.
“Raising revenues is the only sustainable way to increase infrastructure investment. We must answer the tough question of how to sustain investments for future generations and to dig out from the effects of this chronic underinvestment,” DeFazio indicated.
Noting the legislation likely would include policy initiatives on electric cars and trucks, resilient infrastructure that responds to climate change science and autonomous vehicles, he added: “We can’t just maintain what we have; we also need to modernize how we plan and build transportation projects. We have a tremendous opportunity to complete critical projects, create family wage jobs here in the U.S. and support U.S. industry.”
Committee ranking member Missouri Republican Sam Graves continues to promote the alternative of charging motorists for the miles they travel. The VMT fee has not gained nationwide acceptance but could facilitate the transition from fuel taxes.
“First of all, we can’t address our long-term funding issues without finally fixing the Highway Trust Fund. We’ve kicked this can down the road so many times already, pretty soon we’re going to kick it completely off the map,” Graves said. “Congress is going to consider a number of options to address this problem, but I believe that the only viable future lies in a transition to a vehicle-miles-traveled, or VMT, program.”
More than a month into 2019, Trump has yet to unveil an infrastructure plan. His State of the Union touted the potential for reaching a deal on some sort of legislation, yet it did not detail a funding approach. Last year, the White House’s 10-year, $1.5 trillion proposal was panned by transportation leaders in Congress from each party due to its reliance on the private sector.
Analysts say the Highway Trust Fund, which assists states with maintenance and construction projects, will approach insolvency by 2021. The revenue generated from the 24.4-cents-per-gallon diesel tax, and 18.4-cents-per-gallon gas tax is insufficient to sustain the fund. To avoid its insolvency, Congress has supplemented the account with outside funds over the years. The federal fuel tax was last raised in 1993.
Federal inaction helped to persuade more than half of the states to raise their fuel taxes to fund big-ticket projects.