The Countdown Begins – Our Federal Funding for Transportation May Run Dry Next Year

December 18, 2013

Transportation is a key issue in 2014 as the Highway Trust Fund will be insolvent by 2015 and MAP-21 is set to expire in September. In some states, transportation projects are already being put on hold because of the uncertainty of future federal funding.

The UPDATE Act introduced by Rep. Earl Blumenauer (D-OR) is just one of several current proposals regarding infrastructure funding supported by ASCE. To date, the motor fuels user fee (gas tax) has proven to be an efficient, reliable, and fair method of funding our nation’s surface transportation programs.

At present, the federal motor fuels tax generates revenues that are reserved for investment in highway and public transportation improvements through the Highway Trust Fund. However, the 18.4 cents per gallon federal gas tax has not been adjusted since 1993 and has lost one-third of its purchasing power over the last 17 years.

According to the Consumer Price Index, the costs of many household items have nearly doubled over the last 20 years. Some examples include:

  • A loaf of bread: 1993: $0.75, 2013: $1.41
  • A pound of coffee: 1993: $2.50, 2013: $5.21
  • A new car: 1993: $12,750, 2013: $31,252

Despite these price increases, the federal gas tax has remained stagnant with no increase over that time. Presidents Reagan, Bush, and Clinton all raised the gas tax during their administrations. To have the same buying power today as it did in 1993, the gasoline tax would have to be 30 cents per gallon and the diesel tax 39 cents per gallon.

The proposed 15 cents per gallon increase in the UPDATE ACT would cost the average driver less than $3 per week. Meanwhile, as we’ve noted, our insufficient surface transportation system will cost the average American family $1,060 per year by 2020. One does not need to use a calculator to see that this increase would save American families in their pocketbook, boost American business, and help grow our economy.

Since the passage of Transportation Equity Act (ISTEA) in 1998, the Highway Trust Fund has been fire-walled for use on only surface transportation projects—eliminating concerns of bureaucratic misuse. This is simply a question of will—the will to invest in our communities, our cities, and our states. When it comes to infrastructure, we can either pay now or pay more in the future.

The ASCE economic study, Failure to Act – The Economic Impact of Current Investment Trends in Surface Transportation Infrastructure, showed that in 2010, deficiencies in America’s roads, bridges, and transit systems cost American households and businesses roughly $130 billion. The study found that by 2020, the nation’s poor surface transportation infrastructure would cost each American family $1,060 per year.

That is a lot of money.

At ASCE, we support fixing our future problems now, not only to save money, but to begin building a modern economy for a modern world.

So, as you travel for Christmas and the New Year, please do us a favor and fill up your gas tank. It might be the best way to save money this holiday season.

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