DALLAS -- The steady decline in oil prices is an opportunity for Congress to increase the federal gasoline tax to ensure reliable funding for transportation infrastructure, U.S. Chamber of Commerce president Thomas J. Donahue said in his annual State of American Business speech.
But two recently introduced bills and public statements by some lawmakers indicate Congress is not moving in that direction.
Several key Senate committee chairmen have said a higher federal gasoline tax is an option for fully funding a multiyear transportation bill, but House leaders have shown either skepticism or opposition to the idea of a tax increase.
House Speaker John Boehner recently said he's never voted for an increase. Rep. Bill Shuster, R-Pa., chairman of the House Committee on Transportation and Infrastructure said late last year that raising the gas tax would not be politically feasible.
The Chamber will make a strong case to Congress, the White House, and the American public for a long-term highway and mass transit bill with full funding, Donahue said Wednesday.
Water and aviation infrastructure programs must also be funded, he said.
Donahue endorsed the rebranding of the gasoline tax as a "user fee" paid by motorists, as was recently suggested by Sen. James Inhofe, R-Okla., the new chairman of the Senate Environment and Public Works Committee.
"The big question is how to pay for these programs?" Donahue said. "The simplest and fairest way to do this is through a modest increase in the federal fuels user fee that hasn't been increased in more than 20 years."
Donahue said the average price of a gallon of gas has fallen by $1.45 since last summer, bringing the cost to about $2 per gallon in many parts of the country.
"Isn't it reasonable to consider investing a dime or two of those savings back into our roads, bridges, and highways to put Americans to work, clean the air, grow our economy, and save thousands of lives?" Donahue asked. "I know the politics are difficult, but isn't this a pretty good time to try?"
Federal gasoline and diesel taxes are the main revenue sources for the Highway Trust Fund, which supports federal reimbursements to states for highway and transit projects.
Two pieces of legislation have been filed in the House that would affect gasoline tax revenues if enacted.
H.R. 309 introduced on Tuesday by Rep. Jared Huffman, D-Calif., would replace the gasoline tax with a carbon tax on carbon dioxide and other greenhouse gases of $50 per metric ton.
Huffman, a new member of the House Transportation and Infrastructure Committee, said the proposed tax could generate approximately $240 billion for transportation funding through fiscal 2020.
The Environmental Protection Agency, which would determine the emissions associated with gasoline and other fuels, could adjust the tax rate to ensure adequate revenues for transportation needs, Huffman said.
H.R. 118, introduced earlier this year by Rep. Scott Garrett, R-N.J., would lower the federal gasoline tax within a state if the state raises its own tax, by the same amount.
Garrett said his Surface Transportation and Tax Equity act shifts the primary responsibility for transportation infrastructure projects to the states.
Meanwhile, Sen. John Thune, R-S.D., chairman of the Senate Commerce, Science, and Transportation Committee, said recently that a parliamentary process in the Senate known as budget reconciliation could result in a bipartisan reform of the corporate tax code big enough to fund a five- to six-year transportation bill. The budget measure would require only 51 votes to pass in the Senate, not the normal 60, and could be developed with input from the White House to avoid a veto, Thune said Tuesday.
A funding solution needs to be found before the current short-term fix of the Highway Trust Fund expires at the end of May, he said.
The budget reconciliation process would allow lawmakers to deal "with what we know is going to be a crisis come May 31, and that's funding highways," Thune said.
