By David Heymsfield
Former Staff Director, House Committee on Transportation and Infrastructure
Many prior postings in this blog have made strong arguments that an increase in federal support for transportation is a sound investment that will promote economic efficiency, growth in employment, and quality of life. If these arguments do not carry the day, there will need to be careful consideration of the rationale we will use to determine the appropriate level of federal investment in transportation.
I find it difficult to understand the rationale followed in Chairman Ryan’s budget. He concludes that highway and transit funding should be reduced to the amount of the revenues that are now received by the Highway Trust fund from taxes established in 1993. This approach would appear to reduce highway and transit funding by 30% or more — much larger reductions than those proposed in many other programs that would be frozen at 2008 levels. For example, the aviation bill recently passed by the House included reductions of about 6%.
Highway and transit trust-fund revenues come primarily from a gas tax last increased in 1993. The increase was first used for deficit reduction and was only added to the Trust Fund in 1998. The 1993 tax is not indexed for inflation and will yield less revenue if fuel efficiency improves. Why should the revenues which this tax produces be the amount at which we will support federal transportation programs?
From the beginning of the trust fund in 1956 through 1998, trust fund taxes were periodically adjusted to the level that would produce the revenues needed for a sound program. Program needs were determined first, followed by establishing revenues to meet the needs. The 2012 budget proposal reverses the process and uses the revenues produced by a 1993 tax to determine the level of the program. Had the Congresses of 1993 and 1998 realized that they were capping the highway and transit programs forever, they would have given it a lot more thought.
https://transportation.nationaljournal.com/2011/04/food-fight-anyone.php#1945261oldId.20110413113858511
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