Transfers to the federal Highway Trust Fund from the general fund would have to be offset by savings in accounts elsewhere in the budget, under a proposal offered by House Budget Chairman Paul Ryan (R-Wis.).
The Congressional Budget Office projects the trust fund is on a path to insolvency by fiscal 2015, and Ryan called on transportation authorizers to “address the systemic factors that have been driving” the fund toward bankruptcy.
The fund is the main source of federal aid to states for road programs and mass transit agencies. Since many people now drive fuel-efficient cars, revenue from the tax on each gallon of fuel no longer covers the fund’s obligations. The 18.4-cent federal gasoline tax was last increased in 1993.
To keep the trust fund operable, Congress has added $41 billion from general revenue funds since 2008. In the 2012 transportation law, MAP-21, lawmakers approved $21 billion for the fund. The MAP-21 provisions expire in September, and Republicans have suggested they will adhere to Ryan’s proposals as they reauthorize the transportation law in a few months.
“With the Highway Trust Fund facing insolvency in late 2014 or early 2015, efforts need to be made to find a long-term solution to the trust fund’s financial challenges,” the chairman’s summary said. “Maintaining the solvency of the Highway Trust Fund and the policy of the trust fund being user-fee supported is a priority.”
Additionally, Ryan’s plan proposes a pilot program to allow states to opt out of the federal gas tax and forgo federal allocations, an idea championed by several Republicans. It also calls for ending Amtrak operating subsidies, reducing funding for the Transportation Security Agency (TSA, and phasing out subsidies under the Essential Air Service program.
Rep. Nick Rahall of West Virginia, the top Democrat on the House Transportation and Infrastructure Committee, took issue with Ryan’s plan, saying it “takes a partisan jackhammer to our transportation infrastructure.” Ryan’s proposal is expected to win support in the GOP-controlled House, but Democrats in the majority in the Senate are not likely to advance it.