DALLAS -- Congress should expand the Highway Trust Fund to provide federal funding for comprehensive solutions to transportation problems rather than focusing on conventional infrastructure approaches, the Center for American Progress recommends in a recent report.
The next transportation infrastructure bill should establish a separate multimodal account within the HTF - which would be renamed the Transportation Trust Fund - for passenger and freight rail projects, port development, and intermodal facilities as well as major highways and transit projects, said Kevin DeGood, director of infrastructure policy at CAP.
The HTF currently includes two accounts, highways and transit, both of which are supported by federal fuel taxes of 18.4 cents per gallon of gasoline and 24.4 cents per gallon of diesel. Most of the revenue goes into the highway account, with 2.86 cents from each tax dedicated to transit.
It's a myth that highways pay for themselves through user fees, including the gasoline tax, while transit requires a fiscal subsidy to function properly, DeGood said.
"Every type of transportation requires public subsidy," he said. "Just because a portion of funding comes from highway drivers does not mean building more highways is the best solution, especially in metropolitan regions."
Only 40% of the road miles in the National Highway System, which includes interstates and major state arterial roads, generate enough traffic so that gas tax revenues pay for their long-term upkeep, DeGood said. He noted that the calculation does not include road construction costs or inflation of more than 1% a year.
An even smaller percentage of state and local roads are self-sufficient, according to the report released Jan. 28.
Funding from the proposed multimodal account to states could be through a competitive grant process similar to the federal Transportation Investment Generating Economy Recovery program, DeGood said.
The new account could also support major highway and transit capital projects that are too large for a state or metropolitan region to complete using conventional federal funding, he said.
A multimodal approach to transportation would let planners and public officials find the best use for limited transportation funding without restrictions on whether the money should be spend on rails or roads, DeGood said.
However, he said, 30 states have statutory or constitutional prohibitions on funding public transportation and other multimodal projects with fuel tax revenues. At the federal level, DeGood said, there is an unofficial rule that no more than 20% of fuel tax revenues can be allocated to public transit.
"Rather than predetermining what must be built, we should encourage planners to make investment decisions based on what will provide the most benefit, rather than where the money comes from," he said.
Congress last year extended the solvency of the HTF through May 31 with a general fund transfer of $11 billion that filled the gap between gasoline tax revenues and expenditures.
The Congressional Budget Office said last week that grants to state and local governments for transportation projects from the HTF in fiscal 2015 will total $54 billion, including $46 billion for highways and $8 billion for transit. Fuel tax revenues are expected to total $39 billion in fiscal 2015.
