In statements to the House Transportation - HUD Appropriations Subcommittee yesterday, Transportation Secretary Ray LaHood reiterated that the Obama administration does not want to increase motor fuel taxes to shore up the Federal Highway Trust Fund, despite funding shortfalls amounting to $3.6 billion. Pressed by Subcommittee Chairman John Oliver of Massachusetts about how the executive branch proposes to supply the missing cash, LaHood vaguely referred to public toll roads, toll bridges, public-private partnerships and an "infrastructure bank." Although he cited the average citizen's dire financial straits as the reason for not increasing the federal gasoline tax, it sounded like all his other proposals would just represent a different way of taking money out of the pockets of the driving public.
In a related development yesterday, Michigan DOT Director Kirk Steudle told a legislative committee in Lansing that his department will cancel 137 road projects totaling $740 million in value because the state gas tax shortfall of about $102 million will mean inability to provide matching funds for $576 million in federal highway funds. Michigan Infrastructure and Transportation Association spokesman Mike Nystrom says his state stands to lose $1.9 billion in federal highway grants through 2013 unless the fuel tax shortfall can be remedied. To make up the difference, Michigan gas tax would have to go up from $0.19 per gallon to $0.34 per gallon.
With federal fuel efficiency requirements going up, public transportation usage on the increase in major metropolitan areas, and people just plain driving less because of their economic circumstances, this situation will only get worse. Even should the economy snap back, more miles driven per gallon of gas purchased will constantly increase road wear and tear while at the same time reducing the money available for repairs, improvements, and new highways and streets. And LaHood never said where the money to build all these toll plazas and bridge tollgates will come from.
Unless Congress and 50 state legislatures have the courage to raise taxes and fill in this revenue pothole, the road building segment of the construction industry is going to have it pretty rough over the next several years, in spite of the stimulus appropriations.
In a related development yesterday, Michigan DOT Director Kirk Steudle told a legislative committee in Lansing that his department will cancel 137 road projects totaling $740 million in value because the state gas tax shortfall of about $102 million will mean inability to provide matching funds for $576 million in federal highway funds. Michigan Infrastructure and Transportation Association spokesman Mike Nystrom says his state stands to lose $1.9 billion in federal highway grants through 2013 unless the fuel tax shortfall can be remedied. To make up the difference, Michigan gas tax would have to go up from $0.19 per gallon to $0.34 per gallon.
With federal fuel efficiency requirements going up, public transportation usage on the increase in major metropolitan areas, and people just plain driving less because of their economic circumstances, this situation will only get worse. Even should the economy snap back, more miles driven per gallon of gas purchased will constantly increase road wear and tear while at the same time reducing the money available for repairs, improvements, and new highways and streets. And LaHood never said where the money to build all these toll plazas and bridge tollgates will come from.
Unless Congress and 50 state legislatures have the courage to raise taxes and fill in this revenue pothole, the road building segment of the construction industry is going to have it pretty rough over the next several years, in spite of the stimulus appropriations.
