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Rep. Blumenauer introduces plan to raise the federal gas tax

Supported by 23 cosponsors in the House, the Chairman of Transportation for America and a plethora of national construction, transportation and labor groups, Rep. Earl Blumenauer (D-OR) alongside Rep. Peter Welch (D-VT) introduced the UPDATE Act to increase the federal gas tax by 15 cents over three years and index it to the inflation.

John Robert Smith at UPDATE act event

T4America chair Mayor John Robert Smith speaking at a press conference announcing the UPDATE Act on Wednesday, February 4, 2015.

Speaking at a press conference this afternoon following the bill’s (HR 680) introduction earlier this week, Rep. Blumenauer referred to the complicated plans to raise one-time revenue for transportation through corporate tax reform or repatriation of overseas profits and noted that raising the gas tax is “the simplest, easiest to pass, and the only one giving long term stability.”

His plan is certainly the simplest to understand: an increase of five cents in the federal tax on gasoline and diesel for three consecutive years, and then setting it to rise or fall with inflation. Even without more fuel efficient vehicles or Americans driving less overall, inflation has eroded more than a third of the gas tax’s buying power over the past two decades. This plan puts the onus to pay for improved transportation systems on those that use them each day, reinforcing the principle of the users paying for the system.

While all of the 23 cosponsors so far are Democrats and many House GOP leaders have ruled out a gas tax increase, plans like this (or other similar plans to raise revenue) don’t have to be a political third rail. T4America co-chair Mayor John Robert Smith spoke directly to that point at the press conference today:

“When you analyze the election results from the 10 states that raised revenue for transportation since 2012, 98% of those legislators who voted in favor of raising revenue for transportation were re-elected in their next primary. That’s worth repeating, 98% of legislators who stood up and led to raise revenue for transportation were re-elected by their constituents. That is a message members of Congress need to hear and their constituents cannot wait much longer for them to act.”

We do indeed need greater revenue to stabilize the nation’s nearly-insolvent transportation fund, but we also need better policies and reforms to ensure those limited dollars are spent on the projects that provide the highest return. Measuring the performance of our limited transportation dollars to better understand what our dollars get us each year would be a smart place to start. And a forward-looking plan to direct more of that money down to where it’s needed most would be a great companion to any plan to shore up the nation’s transportation funding.

Mayor Smith, as the former mayor of Meridian, MS, understands those challenges facing local communities well, and still hears about them regularly from his former colleagues.

“I’ve been in local elected office for 20 years and early on I realized people back home would be forgiving and will back their incumbent when they see them stand up and lead on issues essential to their wellbeing,” Mayor Smith said at the event. “In Meridian transportation is one of those issues. And transportation is certainly an essential issue for this nation’s wellbeing,”

“Every credible independent report indicates that we are not meeting the demands of our stressed and decaying infrastructure system – roads, bridges and transit,” said Rep. Blumenauer in his press release.

“Congress hasn’t dealt seriously with the funding issue for over 20 years and it’s time to act. The gas tax used to be an efficient road user fee, but with inflation and increased fuel efficiency, especially for some types of vehicles, there is no longer a good relationship between what road users pay and how much they benefit. The average motorist is paying about half as much per mile as they did in 1993. There’s a broad and persuasive coalition that stands ready to support Congress…we just need to give them something to support.”

We support Rep. Blumenauer’s efforts because it provides a long-term, efficient, and sustainable funding source that our local government and businesses can plan for and rely on. With the May 31 deadline of the existing transportation looming on the horizon and states like Tennessee and Arkansas already delaying projects or considering doing so in light of the uncertainty, it’s important that Congress act sooner rather than later.

Obama budget cues start of serious negotiations over transportation funding

With the release of his budget proposal yesterday, President Obama at last offered some specifics on his plan to use the repatriation of taxable corporate profits to fund transportation. In doing so, he staked out a starting point for real-world negotiations over a possible six-year transportation bill – the first time such a prospect has seemed remotely realistic in six years.

His gambit joins a burgeoning set of transportation funding proposals in Congress (more about these later in this post), another hopeful sign that lawmakers are taking the issue seriously.

The less good news, of course, is that those negotiations over tax reform and transportation funding – to say nothing of policy – are almost certain to last beyond the May 31 expiration of the current law, MAP-21. That means another extension and lingering uncertainty until this can be wrestled to the ground.

With the addition of revenues from taxing American profits parked overseas, the Obama budget looks to invest $94.7 billion in fiscal 2016, nearly double today’s level of just over $50 billion. Invested along the lines of his GROW America Act, this would represent a 25 percent increase for the highway program and more than 70 percent for transit, which today is wildly oversubscribed.

All told, the Obama plan would authorize $478 billion for a six-year program of investment, $176 billion over the levels of MAP-21, and $76 billion more than the four-year version of GROW America released last spring. About $240 billion of that is from expected gas tax revenue. Placing a mandatory 14 percent tax on roughly $2 trillion in earnings held abroad by U.S. multinationals would yield about $238 billion, the Administration estimates.

The plan would make the TIGER grant program a permanent feature, funded at $1.25 billion a year, and would continue funding planning grants for planning walkable neighborhoods around transit stops. It also would establish passenger rail and multimodal accounts within the former Highway Trust Fund (HTF), now reconstituted as the Transportation Trust Fund. It would create a multimodal freight program, funded at $1 billion in 2016, and continue to promote the accelerated, inter-agency reviews to get projects moving faster.

While Republicans criticized many features of the Administration budget, the notion of using corporate tax reform to fund transportation seems to have growing bipartisan support, as support for raising the gas tax struggles to take hold.

Last week, the unlikely pairing of Sens. Rand Paul (R-KY) and Barbara Boxer (D-CA) announced they would introduce the “Invest in Transportation Act”, a plan to offer an enticement tax rate of 6.5 percent on corporate earnings returned to the U.S. from abroad, with all proceeds going to the Highway Trust Fund. Because it is voluntary, the exact amount is uncertain, but the senators have said they hope it can make up for flat or declining gas tax revenues.

On the House side, Reps. John Delaney (D-MD) and Richard Hanna (R-NY) have introduced the Infrastructure 2.0 Act, (HR 625), under which existing overseas profits would be subject to a mandatory, one-time 8.75 percent tax. This is expected to yield $120 billion, sending enough of that to the Highway Trust Fund to cover the gap between anticipated gas tax in-take and spending at current levels plus modest growth.

The bill also directs $50 billion of the $120 billion to capitalize an infrastructure bank called the American Infrastructure Fund (AIF) that could provide financing to transportation, energy, communications, water and education projects. Rep. Delaney establishes an AIF in another bill submitted last year along with Rep. Mike Fitzpatrick (R-PA), who reintroduced their “Partnership to Build America Act” (HR 413) on Jan 20. State and local government entities, nonprofit infrastructure providers, private parties, and public-private partnerships all would be eligible to apply for AIF financing. Through bond sales, the fund would be leveraged at a 15:1 ratio to provide up to $750 billion in loans or guarantees.

Not everyone in Congress has given up on the bird-in-the-hand funding source – the gas tax. Rep. Earl Blumenauer (D-OR), is set to reintroduce his UPDATE Act, which would hike the per-gallon tax by 15 cents, with 5 cent increases unfolding over the next three years, and index the overall tax to inflation. In the Senate, Senator Tom Carper (D-DE) is working with a bipartisan group to introduce a gas-tax bill, expected later this month.

Although more of an aspirational bill than a funding measure, Senator Bernie Sanders (I-VT) last week introduced his Rebuild America Act. Designed to illustrate the scale of investment the senator says we need, it calls for providing an additional $1 trillion in infrastructure investments over the next five years for roads, bridges and transit, passenger rail, airports, water infrastructure, marine ports and inland waterways, national parks infrastructure, and broadband and electrical grid upgrades.

It would add $735 billion to surface transportation investments over the next 8 years, with an additional $75 billion a year for the HTF. It also would capitalize a National Infrastructure Bank with $5 billion per year for fiscal 2015-19, estimated to stimulate more than $250 billion in investments. It provide for $2 billion more for TIFIA loans and $5 billion a year for TIGER.

And it makes all the other proposals look like skinflints in comparison.

At last, Congress and the White House appear to have moved transportation to a front-burner issue this year. With the Obama proposal as a strong starting place, here’s hoping negotiations proceed swiftly and in good faith so our communities can continue to plan, maintain and build for continued prosperity.

GOP Rep. Petri joins bill to raise the federal gas tax

The Highway Trust Fund, our nation’s key infrastructure funding source, has been teetering on the edge of insolvency for the last half decade, with legislators from both parties unable to secure a long term funding source.

Rather than continue to stand by and do nothing, retiring Rep. Tom Petri (R-WI) has decided to join Rep. Earl Blumenauer, a Democrat from Oregon, as a co-sponsor on a bill to gradually raise our current gas tax 15 cents to a total of 33.3 cents. That would be the first increase since 1993 when Bill Clinton was president and gas cost a little more than a dollar. The measure also would also index the tax to inflation to stave off future shortfalls.

On Wednesday morning, the bipartisan pair will host an event on Capitol Hill, accompanied by President Reagan – or at least his words and image., Reagan “spoke eloquently on the need for Congress to raise the gas tax in 1982,” according to a joint statement from the two.

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Representative Blumenauer quotes President Reagan on the need for an increase of the gas tax at a press event at the Capitol.

Representative Petri has long been a senior member of the Transportation and Infrastructure Committee for the House side and has said for years now that Congress needs to address the constant deficiencies of the Highway Trust Fund.

“In the Highways and Transit subcommittee, we have held hearing after hearing where state transportation officials, mayors, governors, truckers, transit operators, economists, and experts in transportation policy have testified with unwavering support for a long-term, fully-funded surface transportation bill,” said Petri, after the last short term fix was applied to the Highway Trust Fund over the summer.  “That should still be our goal.”

Blumenauer has been echoing similar sentiments since introducing a similar bill last December.

”Today, with inflation and increased fuel efficiency for vehicles, the average motorist is paying about half as much per mile as they did in 1993,” Blumenauer said in a statement at the time of the introduction. “It’s time for Congress to act. There’s a broad and persuasive coalition that stands ready to support Congress. We just need to give them something to support.”

Although the idea of raising the gas tax polls poorly, politicians of either party would seem to have little to fear from their constituents if they make a good case for ensuring sound highways and transit investments. Since 2012, 98 percent of state legislators in a variety of states including Wyoming, Massachusetts, Virginia, Pennsylvania, Maryland, and New Hampshire who voted to approve an increase of the gas tax were re-elected in their next primary, our analysis shows.

When Senators Murphy and Corker introduced their bipartisan bill that would have raised the gas tax 12 cents over the next two years, Transportation for America’s director, James Corless, stated his approval with an urgency to find a long-term solution instead of short-term fixes.

“A return to stable funding will ensure that our states and communities can repair aging roads, bridges and transit systems and build the infrastructure we need for a growing economy. The alternative is to allow our transportation system to crumble along with an economy hobbled by crapshoot commutes and clogged freight corridors.”

Shining a spotlight on the nation’s strapped transportation fund this Wednesday

It’s not a new story by now: states and local governments stand to lose nearly all access to federal transportation support next year if Congress doesn’t act to shore up the nation’s transportation fund sometime before the end of the summer. So far, we’ve mostly talked about this as a national story, but make no mistake: insolvency would have huge impacts on local communities.

To explore the issue in that light, we’re supporting a bipartisan briefing pulled together by two key House members, Reps. Richard Hanna (R-NY) and Earl Blumenauer (D-OR), on the upcoming expiration of the current transportation law (MAP-21) and the aforementioned shortfall of the Highway Trust Fund. The panel this Wednesday for Hill staffers and media will include three local leaders who understand that investments in transportation are catalysts for development and economic success, using their perspective to localize the impacts of this story.

One story to be shared is the same one featured right here today in this new profile on our website:

Normal, Illinois

A medium-sized city in central Illinois was one of the first to utilize a new, experimental program of competitive federal transportation grants to help implement a city-backed, city-led plan for revitalizing their downtown with a new transportation and civic centerpiece for the town. It’s a successful model of exactly the kind of investments the federal transportation program should be supporting, and proof that it’s not always just big projects in big cities leading the way. Read the full story here

What Mayor Koos from Normal, Illinois shares in that profile is the same message all three local leaders will bring to Washington on Wednesday: No matter how motivated and inspired, the American public and business community cannot do this alone. They need a federal partner that ensures their plans can be realized to provide businesses the opportunity to compete in today’s global economy and allow people to efficiently access jobs and markets.

Also at the briefing will be Sarah Puro, an expert from the Congressional Budget Office, who will share a CBO analysis of the status of the Highway Trust Fund and the choices facing Congress regarding spending from and revenues collected by the fund.

Briefing panelists include The Honorable Chris Koos, Mayor of Normal Illinois; Marc Hill, Chief Policy Officer of the Nashville Area Chamber of Commerce; Charles Hunsicker, Director of Manatee County Florida Parks and Natural Resources, and Sarah Puro, Principal Analyst at the Congressional Budget Office (CBO).

Be sure to follow us on Twitter on Wednesday from 10:30 a.m. – 12 p.m. to hear a few highlights, and watch this space for a short wrap-up after the briefing.

Secretary LaHood, members of Congress celebrate Pennsylvania Avenue’s new bike lanes

LaHood with Mayor Fenty, DDOT Director Gabe Klein and Reps. Blumenauer and Oberstar. Photo courtesy of USDOT.

Transportation Secretary Ray LaHood has made a point of championing bicycling as a legitimate travel option everywhere, but he is also keeping an eye on his own backyard, including Pennsylvania Avenue in Washington DC. LaHood joined DC Mayor Adrian Fenty, city staff and members of Congress in inaugurating the new dedicated bike lanes on what is known to some as “America’s Main Street.”

According to the Washington Post, the new lanes are part of a pilot program on streets expected to be able to accommodate both significant automobile and bicycle traffic. They run along Pennsylvania between Third Street and 15th Street in DC’s Northwest quadrant.

One of the most important people to attend the event, held last Wednesday, June 23, was among the least known: DC Department of Transportation Director Gabe Klein. Although local bicycling advocates had differing opinions on how to construct the Pennsylvania Avenue lanes, no one can dispute that Klein has been a visionary in making DC more livable and accessible by all kinds of transit options. Klein and his staff at DDOT, many of whom attended themselves, deserve a lot of credit.

Here is LaHood on his blog, describing two bike boosters in Congress who attended the inauguration.

We should also thank two of our nation’s most effective bicycling advocates, Rep. Blumenauer and Rep. Jim Oberstar, Chairman of the House Transportation & Infrastructure Committee, both of whom joined us in yesterday’s heat to celebrate these new lanes–in their work shirts and ties, along with helmets, gloves, and ankle straps to keep their pants out of their bike chains.

In his remarks, Rep. Blumenauer made a terrific point, reminding motorists that, “A bike is really a driver’s best friend. Because every bike you see cruising down one of these lanes is one less car to compete with in traffic, one less bit of congestion, one less driver buying fuel.”

But it was Rep. Oberstar who may have had the best line of the day: “Bicyclists aren’t burning hydrocarbons; we’re burning carbohydrates!”

Videos from last week’s Portland Streetcar unveiling

Youtube user bobrpdx has some great videos of last week’s unveiling of the made in the USA streetcar in Portland, including interviews with Rep. Pete DeFazio and Rep. Earl Blumenauer. Check out the rest of his videos for more Portland transit goodness.

In this particular video, Rep. DeFazio talks about the streetcar made locally by Oregon Iron Works with great admiration and pride: “Here’s the product. It’s an improvement on the European design, something I believe that in a very short period of time we’ll be exporting back to Europe,” he said.