Senate Environment and Public Works Chairman Barbara Boxer convened a hearing today on the President Obama's appointment of Victor Mendez to be Federal Highway Administrator, but the controversy at the session was not about the qualifications of the nominee. Boxer announced, and Transportation Department spokesperson Jill Zuckman confirmed, that the Federal Highway Trust Fund will run out of cash sometime this August, before the end of the fiscal year, and in spite of an infusion last fall of $8 billion in general revenues. According to Senator Boxer's statement, the Fund is nearly $7 billion short of the amount of money needed to pay for current construction projects through the end of the fiscal year on September 30, 2009.
It does not seem likely that a six year reauthorization bill will pass before the current legislation expires, also September 30, 2009, and Boxer says the administration has advised her that as much as $10 billion will be needed through September 30, 2010, to make up for shortfalls in the fuel tax revenues that supply funding for highway, waterway, railway and public mass transit construction and repair projects. Ranking Member James Inhofe complained at the confirmation hearing that the Obama administration held a conference call with Democratic committee members, to the exclusion of Republicans, to discuss these funding problems, and received a commitment from nominee Mendez that the Transportation Department would include members from both sides of the aisle in future communications.
The Federal Highway Trust Fund was created in 1956 as part of the legislation authorizing the federal interstate highway system, and has been fully supported by fuel taxes until the emergency $8 billion infusion last fall. Federal gas tax revenues have been falling since late 2007, due to declines in miles driven by citizens, greater fuel efficiency of vehicles, and increasing ridership of public transportation. Without an increase in the present tax of 18.4 cents per gallon, the situation will get worse and worse as time marches on. Two Congressionally mandated study commissions have recommended fuel tax increases, to as much as 58 cents per gallon, to maintain surface transportation infrastructure. The alternative proposal of a mileage tax would take as long as 10 years to implement, and if driving mileage continues to decline, it still would not solve the problem in the long run. Despite President Obama's adamant refusal to propose a gas tax increase now, Senator George Voinovich said at the Mendez confirmation hearings that such an increase "is the reality of the situation."
With the complex and contentious issue of health care reform now at the top of the Congressional in box, any permanent solution to this problem is unlikely during this session of Congress, and any serious investment in infrastructure repair and construction beyond the economic stimulus appropriations is just a pipe dream.
It does not seem likely that a six year reauthorization bill will pass before the current legislation expires, also September 30, 2009, and Boxer says the administration has advised her that as much as $10 billion will be needed through September 30, 2010, to make up for shortfalls in the fuel tax revenues that supply funding for highway, waterway, railway and public mass transit construction and repair projects. Ranking Member James Inhofe complained at the confirmation hearing that the Obama administration held a conference call with Democratic committee members, to the exclusion of Republicans, to discuss these funding problems, and received a commitment from nominee Mendez that the Transportation Department would include members from both sides of the aisle in future communications.
The Federal Highway Trust Fund was created in 1956 as part of the legislation authorizing the federal interstate highway system, and has been fully supported by fuel taxes until the emergency $8 billion infusion last fall. Federal gas tax revenues have been falling since late 2007, due to declines in miles driven by citizens, greater fuel efficiency of vehicles, and increasing ridership of public transportation. Without an increase in the present tax of 18.4 cents per gallon, the situation will get worse and worse as time marches on. Two Congressionally mandated study commissions have recommended fuel tax increases, to as much as 58 cents per gallon, to maintain surface transportation infrastructure. The alternative proposal of a mileage tax would take as long as 10 years to implement, and if driving mileage continues to decline, it still would not solve the problem in the long run. Despite President Obama's adamant refusal to propose a gas tax increase now, Senator George Voinovich said at the Mendez confirmation hearings that such an increase "is the reality of the situation."
With the complex and contentious issue of health care reform now at the top of the Congressional in box, any permanent solution to this problem is unlikely during this session of Congress, and any serious investment in infrastructure repair and construction beyond the economic stimulus appropriations is just a pipe dream.
