WASHINGTON – The American Trucking Association wants the administration and Congress to create a Build America Fund that would be backed by fuels fees and generate $340 billion over 10 years to modernize the nation’s deteriorating network of highways and bridges.
The fund would be supported by a 20-cent-per-gallon federal user fee – phased in at a nickel per year over four years -- that would be built into the wholesale price of all transportation fuels and collected at fuels terminals. Fuels would include natural gas as well as diesel and gasoline. The fee would be indexed to both inflation and improvements in fuel efficiency, with a 5% annual cap.
The ATA said on Wednesday that the Build America Fund would be a supplement, not a replacement, to the Highway Trust Fund and would be an alternative to tolling and public-private partnerships.
The ATA’s proposal is similar to the 25-cent-per-gallon increase in fuels taxes in the U.S. Chamber of Commerce’s four-point infrastructure plan released last week, but the Chamber would add the increased revenues to the HTF.
These proposals are being released before President Trump offers his infrastructure plan later this month or in February but they run counter to a purported draft of that plan.
The draft, leaked earlier this week, called for an expansion of tolling on interstates and initiatives for private investment but made no mention of the HTF, drawing complaints from these groups, other transportation advocates, and some lawmakers.
“A 21st century transportation network cannot be sustained with financial tricks and finance schemes – it requires real and substantial investment,” said Chris Spear, the ATA’s president and CEO.
“The Build America Fund is the most efficient – and conservative – way to generate infrastructure investment and adheres to the bedrock principal that users only pay for what they use,” he said.
“So-called ‘creative financing’ tools are a road to nowhere, as study after study shows the shortfalls of tolling and the unintended consequences that tolls impose on motorists and surrounding communities,” Spear said. “There is nothing ‘conservative’ about tolling.”
The ATA estimates the 20-cent user fee would only cost the average motorist $100 per year but would alleviate traffic congestion caused by failing infrastructure.
The group said the trucking industry is already paying almost half of the funding tab for the nation’s highways, contributing 45% to HTF user fee revenue even though trucks account for only 14% of vehicle miles traveled on roads. But truckers are willing to pay more, it said.
“Through the Build America Fund, the trucking industry to would invest upwards of an additional $112 billion,” the ATA said.
The nation “is heading straight toward a highway funding cliff” because the Highway Trust Fund is will run out of money in fiscal 2021, the ATA said. With more fuel efficient cars and infrastructure needs, revenues are not keeping up with funding.
The HTF finances most of the federal government’s spending for highways and mass transit through grants to state and local governments. It is supported by a federal tax of 18.4 cents per gallon on gasoline and a tax of 24.4 cents per gallon on diesel fuel as well as related excise taxes, which have not been increased since 1993 in spite of inflation.
Congress has had to prop the HTF up with transfers of general funds. According to the ATA, by 2025, an estimated $88 billion will be needed to shore the HTF up to prevent a reduction in funding.
Tolling “is a waste of taxpayer money,” the ATA said. The administrative, collection and enforcement costs of a typical toll facility are between 12% and 33.5% of the revenue generated, it said. That compares to less than 1% of revenue for the collection of fuels taxes.
“Even worse, many public-private partnerships (a code word for tolls) are operated by multi-national corporations putting
Americans’ hard-earned dollars in the pockets of foreigners,” the group said.
A national survey of 800 registered voters conducted in June 2017 showed that only 23% preferred tolls while 57% supported user fees, according to the ATA.