Gas Tax Is Imperative to a Robust Highway Bill | Commentary
This harsh winter has taken a serious toll on our roads and bridges, adding to the potholes and cracks in an already-damaged infrastructure across our nation. This spring and summer will be absolutely crucial for the construction industry to repair the damage and continue building a transportation infrastructure for the 21st century. Unfortunately, inaction in Washington has led to uncertainty and hesitation from the industry because of the pending shortfall of the Highway Trust Fund and potential loss of federal transportation assistance which makes up over half of state capital investment in highway bridge improvement projects.
If Congress and President Barack Obama don’t act before Oct. 1, there will be no new federal money for highway and bridge projects in fiscal year 2015. Such a scenario would jeopardize hundreds of thousands of American jobs and threaten the ability to safely and efficiently move people and goods across the entire infrastructure network.
At least 10 states — Colorado, Georgia, Iowa, Kentucky, Missouri, Oregon, Rhode Island, South Dakota, Vermont and Arkansas — have already publicly warned about the potential negative impacts on projects from the continued uncertainty. In particular, Arkansas said it will be halting work on 10 projects valued at $60 million.
With the current surface transportation act, MAP-21, set to expire at the end of September and the Trust Fund expected to run out of money as early as July, it is imperative that Congress do its job and pass a robust reauthorization to give the state, local, and regional planners and industry the confidence they need to do their jobs.
Obama has offered in his budget a substantial investment in transportation of $302 billion over four years, including $199 billion for the highway program. This would increase federal highway funding from $41 billion to $48.6 billion in fiscal 2015 alone, and would increase further in subsequent years. If the president’s plan was to be adopted, 171,000 jobs would be created with about 40%, or 68,000 created in the construction sector. The fact of the matter is that with 15 percent unemployment in the construction sector, we need to get Americans back to work.
Passing a four-year reauthorization of MAP-21, that is fully funded, would be the most significant stimulus that this recovering economy so desperately needs. There are thousands of projects ready to go.
To pay for our surface transportation investments now, we need to maintain the integrity of the gas tax as a user-fee and source of revenue for the Highway Trust Fund. Although Obama and Rep. Dave Camp, R-Mich., chairman of the House Ways and Means Committee, have proposed using one-time corporate tax reform to pay for their transportation plans, they do not agree on how to enact the reform, nor is the it a long-term fix to the HTF. The unsustainability of the Trust Fund is a direct result of Congress’s failure to raise the federal motor fuel tax since 1993. As a result, we have had to borrow $53 billion since 2008, further adding to the deficit.
Although several suggestions have been made to fund the Trust Fund, the only way to fund it robustly is to increase the motor fuel tax as President Reagan did in 1983, President George Bush did in 1990 and President Bill Clinton did in 1993. I’m pleased that Sen. Thomas R. Carper, D-Del., chairman of the subcommittee tasked with writing the reauthorization bill and member of the Finance Committee tasked with paying for it, has summoned the political courage to propose an increase to the motor fuel tax of 3- or 4-cents-per-year for four years, and then linking it to inflation. I’m hopeful that he can find a Republican partner so that this can be done on a bipartisan basis.
The passage of a robust four-year reauthorization would be the biggest job creator we have had since the stimulus bill, would respond to the growing crisis in highway and transit infrastructure, substantially reduce greenhouse gas emissions, and last but not least, relieve the stress being experienced by millions of Americans traveling on our highways each day and provide many more of them with a transit or rail alternative.
Wouldn’t it be wonderful if Congress and the president could get something done before the end of the year that is bipartisan, good for the country, and restores the American people’s faith in our government?
George Voinovich is a former Republican senator from Ohio.