TPB News

TPB to Congress: Protect the Highway Trust Fund From Insolvency, Now and Into the Future

Jun 2, 2014

The Transportation Planning Board recently urged the United States Congress to act immediately to replenish the federal Highway Trust Fund and to secure more reliable, long-term sources of revenue to support ongoing transportation investments into the future.

Federal officials anticipate that the fund, from which nearly all federal aid for road and transit projects flows, will become insolvent by the end of August. That means that incoming revenues, from fuel taxes and other sources, will not be able to pay for the $51 billion in transportation spending that Congress has already promised during the current fiscal year, which ends September 30. If that happens, officials would have to delay or stop payments to states and localities for projects that are already under construction or are scheduled to begin soon.

The TPB conveyed its message in an official letter to members of Congress representing districts in the Washington region. The letter says that insolvency of the Highway Trust Fund would result in "significant administrative burdens and immediate unmet transportation needs in the Washington region."

"Agencies responsible for keeping our roadways and transit systems safe and in a state of good repair have programmed nearly $2 billion in federal funding to spend on hundreds of improvements this year," the TPB said in its letter. "Many of the projects address critical safety needs. Insolvency will put agencies in the impossible position of deciding which projects to keep funding and which to halt."

The letter pointed out the major impacts such disruptions would have in the region, including threatening job growth and economic recovery, and making it harder to maintain mobility for the federal workforce and for the millions of people who visit the nation's capital each year.

States and localities across the country have long relied on federal funding to make major investments in transportation infrastructure to support economic growth and quality of life. The Washington region's Metro system and its Interstate highways, including critical bridge connections across the Potomac River, would never have been built without the promise of federal funds to help pay for them.

Traditionally, Congress has provided long-term assurances of federal aid by authorizing funding for up to six years at a time. Until recently, federal fuel taxes provided the kind of reliable source of revenue needed to make such promises.

But those taxes, which are assessed on a per-gallon basis, have not been increased in more than 20 years. During that time, the TPB letter says, "inflation has eroded nearly 40 percent of their purchasing power" and less reliable solutions, like transfers of general fund revenues and other one-time fixes, have been used to fill the widening gap between traditional revenue sources and growing transportation needs.

Later this year, Congress will have an opportunity to secure a more sustainable source of revenue for the long-term when it considers extending the current federal authorization, known as MAP-21, or when it introduces a brand-new bill. Authorization must happen to allow any federal spending on transportation beyond September 30, the date that MAP-21 expires.

In its letter, the TPB cited the historic steps Virginia and Maryland took in 2013 to raise new revenue for transportation by raising user fees and other taxes. "Now it's time for the federal government to do its part," the letter says.

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