DALLAS - The $8.1 billion of general revenues transferred into the Highway Trust Fund in July will be able to keep the HTF functional only until late November rather than through mid-2016 as projected last month, Transportation Secretary Anthony Foxx said.
"The trust fund could be facing rocky seas and therefore need additional funding from Congress before the end of the year, potentially as soon as this coming November," Foxx said in a blog on Wednesday. "This is not the time to get complacent about the health of the Highway Trust Fund."
The cash balance in the highway portion of the HTF is projected to dip below $4 billion by Nov. 29, triggering a slowdown in federal reimbursements to states and possibly a reduction in the payment rate, he said.
The balance in transit portion of the HTF should stay above the "prudent operating balance" of $1 billion until June 2016, according to the latest HTF ticker report on the Transportation Department's web site.
"With the recent funding infusion that Congress authorized in July, we anticipate the cash balance of the highway account staying above zero until June 2016, but that is far from the whole story," Foxx said.
The HTF will remain functional for at least a few weeks beyond the expiration of 90-day extension, but the authorization for many programs will end along with the short-term fix, Foxx said.
"The failure of Congress to act prior to Oct. 29 will prevent new obligations from the highway and transit programs -- including grant awards, infrastructure loans, and even DOT payroll -- and will further affect reimbursements to states," he said.
The latest projection shows the highway accounting hitting a zero balance by late August 2016 while the transit portion is expected to last through September.
"Once we approach the 2016 construction season in the spring, the situation just gets dramatically worse as the balances rapidly decline to the point where the fund will become fully insolvent and we will be unable to meet our financial obligations to the states," Foxx said.
The short-term fix, P.L. 114-41, which reauthorized federal transportation funding through the end of October, transferred $6.1 billion into the HTF's highway account and $2 billion into the transit account. The extension was the 34th stop-gap measure since 2008 and brought the total of revenue transfers into the HTF to more than $73 billion.
Expenditures from the HTF totaled $53.7 billion in fiscal 2015. The HTF was supplemented with general revenues because collections from the federal gasoline tax and other dedicated levies came to only $39.6 billion.
The Senate passed the six-year, $350 billion DRIVE Act transportation infrastructure measure in late July. It was fully funded it for only the first three years with $47 billion of revenue offsets and $120 billion of gasoline and diesel tax collections.
The Transportation Department said last month in its regular report on the HTF's fiscal health that the usual winter construction slowdown likely would reduce the level of reimbursements to states by enough to keep the fund solvent into the third quarter of fiscal 2016.
Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, said last week that another extension of federal funding probably will be needed to give lawmakers enough time to reach consensus on additional revenues in a multiyear bill.
