Federal Highway Money Remains At Risk

Jul 11, 2014

I-80, Wyoming
I-80, Wyoming
Credit Doug Mahugh via Flickr

The federal pot of money that’s supposed to keep local roads and bridges intact may soon be empty, yet lawmakers on Capitol Hill are miles apart from each other. It remains unclear if they’ll be able to bridge the gulf. Matt Laslo reports from Washington on how the Wyoming delegation is weighing in on the debate that’s sucking the air out of Washington this summer.

MATT LASLO: While more fuel efficient cars and trucks may be good for your wallet and the environment, they may not be so good for the roads you drive on. The federal Highway Trust Fund relies on an eighteen cent per gallon gas tax. If you drive diesel the government hits you for twenty four cents per gallon each time you fill up. Vehicles driving farther on less fuel mean the current formula which was developed in the nineteen nineties leaves the highway fund facing insolvency. Wyoming Senior Senator Mike Enzi says transportation officials everywhere are bracing for the fund could run out of cash in the next few weeks. 

MIKE ENZI: “I don’t think there’s any state in the nation that isn’t going to be hurt by the end of all infrastructure construction. And that’s supposed to happen sometime during August. So there will be a huge outcry from people across the country whose jobs are being affected by that…Infrastructure and being able to travel is a big part of the United States but it’s an even bigger part of Wyoming.”

LASLO: The pending crisis is sparking a debate in Washington over the future of U-S transportation funding. Enzi says part of the current problem is that lawmakers in both parties have avoided even tweaking the highway formula to keep up with inflation.

ENZI: “We’ve had a lot of inflation since 1993, which was the last time that the gas tax was raised. And there are other kinds of energy that are used in automobiles now, and they’re not being taxed for the highways that they’re using. So something needs to be looked at.”

LASLO: Enzi – an accountant by trade – says there’s been another problem of late: raiding the fund.

ENZI: “Over the last four years we’ve decided that the highway fund would tap into everybody else. And doing some really phenomenal, bad bookkeeping things we stole from the pension benefit trust fund and we stole from the abandoned mine land trust fund for 10 years to build highways for two years. Nobody gets to make that kind of a deal, but that’s what’s been happening around here.”

LASLO: While most Democrats say it makes sense to just raise the gas tax, Republicans are using the pending crisis to try to change the long term use of the trust fund. Many don’t like that about 15% of it goes to rail while untold billions goes to environmental mitigation and highway beautification projects. Wyoming Congresswoman Cynthia Lummis says a highway fund should pay for highways.

CYNTHIA LUMMIS: “Use the money that is raised for the Highway Trust Fund to literally shore up the funding for the real roads and bridges that we need to get back in a state of repair.”

LASLO: House Republican leaders are scrambling to find a solution so they can avoid the blame if the fund goes broke. One proposal they offered is ending most Saturday postal service and putting the savings in the highway fund. The idea is seen as a temporary fix by lawmakers in both parties…applying future savings to today’s trust fund shortfall. Lummis doesn’t like the sound of that.

LUMMIS: “I’m not comfortable with a number of the proposals I’ve seen, including taking a provision that would bring about some savings due to five-day delivery of mail, as opposed to six-day delivery of mail, and take savings from the U.S. Postal Service and then apply them to the Highway Trust Fund.”

LASLO: Another idea that’s gaining bipartisan support is to give companies with holdings overseas a temporary tax “holiday.” The trillions of dollars held by companies overseas could come back to the U-S at greatly reduced tax rates. That repatriated revenue could be used to replenish the fund. Lummis says it makes sense.

LUMMIS: “I think it’s good public policy all the way around to repatriate those dollars and put them to work in the United States. And having a need like this that’s so glaringly identified that benefits the whole country – that is, repairing our roads and bridges.”

LASLO: But reforming the tax code is a touchy political issue that could take years, and lawmakers just have weeks to find a solution. California Democratic Senator Barbara Boxer says if most Republicans are unwilling to raise the gas tax, they ought to just scrap it and pass the fee from drivers to the oil companies.

BARBARA BOXER: “I’d like to do away with the gas tax and replace with it a user fee at the refinery level. Then we would never have a gas tax. That’s my favorite proposal.”

LASLO: That’s a non starter for Wyoming lawmakers. Republican Senator John Barrasso says that could stunt the state’s booming energy sector.

JOHN BARRASSO: “Gasoline prices are already high. The president’s policies continue to drive them higher. And if the president is really concerned about our economy he ought to be focused on developing American energy instead of just turning more and more to the Middle East.”

LASLO: The fight over the future of highways doesn’t cut across the normal partisan lines this Congress has become known for. Many Republicans want to give states more flexibility with transportation funding by allowing them to collect the bulk of the gas tax themselves. Senator Enzi says that proposal is a non starter in Wyoming because the state has so much federal land and open space.

ENZI: “So the gas tax is actually fixed so that Wyoming gets a higher percentage than what we pay into the fund. So having the national approach to it’s very, very important to Wyoming.”

LASLO: This week a House and a Senate committee separately passed bills to inject $11 billion into the fund to keep it going until May. It’s paid for with customs fees and by allowing companies to defer their pension payments. There are still major differences to be worked out, but critics say Congress is doing what they’ve always done in the past. Congresswoman Lummis says she fears lawmakers are once again going to avoid tackling the problem as the deadline for the Highway Trust Fund quickly approaches.  

LUMMIS: “That is – our history is to kick the can down the road, patch it, put a Band-Aid on it, use some bailing wire and limp along until after the election.”

LASLO: The federal Department of Transportation is warning there are just weeks until it will have to start slowing the flow of checks to states. That means there’s little time for this Congress to deal with the long term proposals. Transportation officials are hoping lawmakers can find a short term solution so they don’t have to stop construction – even if they say the nation desperately needs a long term strategy.

For Wyoming Public Radio, I’m Matt Laslo in Washington.