Federal Transportation Funding May Be Running Out of Gas

Thursday, March 14, 2013
(photo: Seth Perlman, AP)

Federal funding for transportation projects will soon dry up unless Congress decides how to refuel the Highway Trust Fund.


For decades, the U.S. government used the existing 18.4 cents-per-gallon gas tax to finance the fund, which pays for roads and rail programs throughout the U.S.


But over the last 20 years, inflation and fuel-efficient automobiles have caused more money to be spent than what the highway trust takes in through the gas tax.


Consequently, the trust—which will have about $12 billion by the end of the current fiscal year—is projected to have zero dollars left by 2014. This is according to a new report (pdf) from the Congressional Budget Office.


As with most things in Washington, there is a sharp political divide over how to generate revenue for the trust. President Obama has proposed using funds saved from a reduction in defense spending, while House Republicans want to tie transportation spending to an increase in offshore oil drilling. Others are urging such funding to be eliminated from the federal budget altogether and handed over to the states and local governing bodies, a responsibility that has already been undertaken by a number of cities in the U.S.


Even if lawmakers can figure out how to restore the trust, the federal transportation program is also in need of a new mission.


“There's no longer a clear priority for national transport investment like there was during the heyday (or, rather, hey-half century) of the interstate highway program,” Eric Jaffe wrote for The Atlantic Cities. “Maintaining existing roads lacks the ribbon-cutting appeal of opening new ones. The closest thing to a new national initiative is a high-speed rail program, but while regional lines will no doubt emerge in dense corridors like California and the Northeast, political support for a national bullet train network is, to be generous, rather tepid. Lawmakers can barely muster the energy to pay for the rail system America already has, let alone a brand new one.”

-Noel Brinkerhoff, Danny Biederman


To Learn More:

The End of Federal Transportation Funding as We Know It (by Eric Jaffe, Atlantic Cities)

CBO Reports Highway Trust Fund Headed for Bankruptcy in 2014 (by Keith Laing, The Hill)

Federal Road and Bridge Spending Misdirected; Billions Wasted (by Noel Brinkerhoff, AllGov)

Wyoming Best at Using New Highway Funding, Florida Worst (by Noel Brinkerhoff, AllGov)


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