Authorization of the next surface transportation bill has
languished in Congress. Learn about prospects for a
breakthrough and how states are dealing with continued
uncertainty and planning for a future with diminished federal
resources.
Good afternoon. It is a pleasure to be here to talk with you about the outlook for Federal surface transportation funding and programs. We are at a crossroads for the Federal transportation programs. The decisions that must come will have far reaching implications for that nation’s future. These programs impact the economy, safety, the environment and generally the nation’s quality of life.
Let me address the overall climate for surface transportation reauthorization and funding. As I said, we are at a crossroad in transportation’s future direction. To provide a context, I have divided my presentation into a series of segments to give you a prospective on how the future direction may take shape. I say may because the whole direction is fluid. I will attempt to address the current climate that will affect future funding. Than discuss key questions on Federal funding followed by facts, figures and a discussion of what we all face as the Federal government proceeds to set a future course.
Let’s begin with the issues.
The latest news on the Federal front is: Highway and transit programs are being funded in short-term extensions at current levels. The Administration has said it will send up a proposal for reauthorization and funding in February with the Federal budget. The current extension expires September30th. As does the authority to collect Federal gas tax and pay the States. The Federal Highway Trust Fund has had to get transfers from the Federal General Fund to pay the bills.
There is no clear path forward. The House has developed a major redirection of the programs. The Senate has shown no inclination to move forward. Funding is clearly shot. The future direction is very unclear. We face other priorities.
Discuss the possible outcomes
Everything needs a context. Nationally we are meeting about 33 percent of needs at all levels of government and given current revenue we face a massive funding gap and possible program funding reductions.
Let me take you through a set of illustrative revenue sources starting with the traditional gas tax and other state type user fees. You can see from the chart than tags tax is the main fee followed by motor vehicle registration fees and truck sales tax at the federal level. But there are other ideas such s VMT fees, carbon taxes, sales taxes, freight charges and custom fees just to name a few. The list in fact extends to revenue totaling $1.3 trillion dollars. However, the politics of each of these potential sources tend to mitigate against adopting them. So the question becomes what to do.
Given the magnitude and diversity of needs, states and local governments should be provided with maximum flexibility to use federal revenues from existing core sources to meet systemic transportation needs.