Leaders of three Senate committees that oversee transportation are calling for colleagues to work together to address the Highway Trust Fund shortfall that is expected to occur after the current funding law expires on Sept. 30, 2014.

“A strong transportation system is vital to ensuring the economic competitiveness of the United States and this requires maintaining federal investments in our transportation infrastructure,” Sens. Barbara Boxer, D-Calif., Jay Rockefeller, D-W. Va., and Tim Johnson, D-S.D., wrote in a letter to colleagues. “We must work together in a bipartisan way to address this challenge, find a dependable source of sustainable funding for the HTF, and keep the nation’s transportation systems strong.”

Boxer chairs the Environment and Public Works Committee, Rockefeller chairs the Commerce, Science and Transportation Committee, and Johnson chairs the Senate Banking Committee.

The current law — Moving Ahead for Progress in the 21st Century Act, or MAP-21 — was signed into law in July 2012 and authorized about $19 billion in general fund transfers to the Highway Trust Fund through fiscal year 2014. It also substantially increased the funding level for the Transportation Infrastructure Finance and Innovation Act program, which provides loans, loan guarantees and standby lines of credit for surface transportation projects.

The HTF, which provides  money for surface transportation projects and is often used to back bonds called grant anticipation revenue vehicles, is primarily funded by motor fuel taxes. However, the fund  has teetered on the edge of insolvency in recent years as people drive less and use more fuel-efficient cars. The Congressional Budget Office predicts the HTF will not have sufficient resources to meet all of its obligations starting in fiscal 2015 if Congress doesn’t act to solve the problem.

In a news conference Thursday, Boxer called the letter “a clarion call to all of our colleagues, saying ‘Please pay attention to this and please be part of the solution.’”

Boxer said continued funding for transportation projects is important to the country’s economy and that about three million jobs are at risk if current law isn’t renewed. She was joined at a news conference by leaders of transportation-sector groups who stressed the necessity of federal resources.

“I don’t think we can overstate the importance of transportation to the United States economy, to the jobs that are created by transportation, and to the quality of life that Americans enjoy every day,” said Bud Wright, executive director of the American Association of State Highway and Transportation Officials. Most states do not have the cash flow to compensate for money that they would lose if the HTF failed, he added.

Boxer said she thinks the HTF should be supported by user fees. “If it’s a user fee, then it has certainty,” she said.

But she said she could support many options for keeping the HTF solvent. Her team has come up several. One approach would be to keep the gas tax and supplement it with other user fees. Another would involve eliminating the gas tax and adding new user fees, she said.

New user fees would have to be put in place by the Senate Finance Committee.  Boxer said the top congressional tax-writers are looking at long-term solutions for the HTF while they are working to reform the tax code.

Boxer also said she would support a tax on vehicle miles traveled, as long as the data was reported on the honor system rather than recorded by devices installed in vehicles. But she added that she doesn’t think a VMT tax would be widely supported by other Congress members.

“Vehicle miles traveled is the most fair way to pay for roads,” she said.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.