The Highway Trust Fund: Important and Necessary Government Spending

While liberals and conservatives constantly debate about the necessity of government spending on various programs and projects, there is bipartisan agreement among voters on the need for maintaining our highway infrastructure.  To that point, the Highway Trust Fund must remain adequately financed to keep our roads and bridges operational and safe.

The fund currently lacks $8.1 billion and will become insolvent in August, absent an infusion of financing.    Congressional summer recess and midterm elections are not an excuse for avoiding what should be a no-brain decision to upkeep our infrastructure.

Unlike much government spending, roads and bridges are not kickbacks that only benefit campaign contributors or favored special interest groups.  They are public goods utilized everyday by Americans of all backgrounds.    Infrastructure must constantly be monitored and maintained — it is not something that can be addressed every few years.  This is why before any large-scale infrastructure bill gets approved by Congress, we need a short term fix in the form of adequately financing the Highway Trust Fund.

Failure to address this issue in the short term , while not the cataclysm that some have projected, puts strain not just on the existing revenue stream, but also on the state funds that are relied upon to bolster the Highway Trust Fund – removing the certainty and state-to-state uniformity engendered by federal funding.  Federal funding ensures equal treatment of highway issues rather than a patchwork of state approaches, but the $110 billion in local and state spending on roads doubles federal spending and would likely keep most existing projects moving in the event of a brief federal shortfall.

Perhaps just as importantly, allowing the fund to fall into insolvency this summer makes the challenge of meaningfully revising the structure of the Highway Trust Fund that much more difficult, adding even greater political pressure to an issue that already carries the dreaded prospect of “tax increases” to the forefront.

 

Fortunately, a respite – at least in the short term – does appear to be at hand in the form of a coalescing, if still unsteady and preliminary, agreement on an infusion of revenue that will keep the fund solvent through next spring – beyond the election and into a new Congress.

Still, questions remain over how to construct such a package. Pension smoothing, collection of delinquent taxes, and a transfer of funds from the Leaking Underground Storage Tank trust fund are in discussion on both sides of the aisle and on both sides of the Hill. But, as these bills snake their way toward floor consideration – especially given the fact that the extension of funding is among the last “must pass” bills facing the 113th Congress – the potential for a messy, politically-driven amendment process is strong.

Such campaign politicking has no place in this debate, whether in the short or long term. With the clock ticking, lawmakers do not have time to get stuck in the mud debating unrelated policy priorities, inserted into the proceedings more for messaging than as a genuine contribution. We witnessed this the last time a major highway bill graced the Senate floor with its presence in an election year, when some on the left attempted, unsuccessfully to attach a measure increasing taxes on American energy companies to the bill.

This time around, as we debate both a short term patch and a long term revision to the manner in which the Highway Trust Fund is funded, it’s vital that lawmakers focus like a laser on the task at hand. With less miles traveled, more efficient cars, and greater reliance on public transportation, it’s clear that leaving the gas tax at its current level is not an option. Federal action is needed. The bipartisan legislation introduced last month by Senators Corker and Murphy would take the drastic(according to some) but likely needed step of both increasing the gas tax (by 12 cents)over two years and indexing it to inflation. The bill has promise, even if it or any similar measure won’t see meaningful action until after the election.  And states should  raise their fuel taxes, or eliminate them and not eliminate them as Virginia did, so that  broader user-pay philosophy that has long defined highway funding is not further undercut.

It won’t be easy, but if we’re going to fix this problem, we need to have the debate now, and we need that debate to be earnest, genuine, and devoid of extraneous partisanship.  As we know all too well, Congress has plenty of that as is.

 

This article appeared on the FuelFix website at http://fuelfix.com/blog/2014/07/11/the-highway-trust-fund-important-and-necessary-government-spending/

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