highway trust fund Archives - Transportation For America

Congress only proposes delusional ideas to fix the highway trust fund

Large highways running through a community.

Congress will propose nearly anything other than raising the gas tax to fix the highway trust fund. If Congress actually addressed the program’s total failure to deliver outcomes, maybe it would be easier to build broad support for raising significant new transportation funding.

Since 2008, the federal highway trust fund has received infusions from the general fund totaling over $280 billion. The federal gas tax has not been increased above its current level of 18 cents per gallon since 1993. With every reauthorization of the program, there is always a looming date (currently 2028) when the Highway Trust Fund will go broke. Yet, every time we come around to discussions on the next surface transportation reauthorization, delusional thinking about how to fund the federal transportation program emerges.

For nearly two decades, rather than increasing the gas tax, Congress has resorted to infusions from the general fund to pass a multi-year transportation bill. Congress has come up with all sorts of convoluted machinations to delude themselves into thinking they aren’t increasing the deficit.

For the 2012 MAP-21 transportation reauthorization and its short-term extension in 2014, Congress used many questionable budget maneuvers to make it look like they were paying for the infusions with cuts elsewhere. The most memorable of these was“pension-smoothing,” a bizarre accounting trick that delayed pension contributions—and the tax relief that comes with them—to more than 10 years in the future, beyond the horizon the Congressional Budget Office considers when calculating the impact on the deficit. This means we lose more tax revenue today to pay for the 2012 MAP-21 transportation bill than we would have back then.

Congress has also made a few attempts to adopt a vehicle miles traveled (VMT) user fee. In fact, a federal pilot program supported the adoption of voluntary VMT fees in several states starting in 2015, but none of them ever incorporated it into their mandatory fee structure. However, a few states allow drivers of fuel-efficient and electric vehicles (EVs) to choose VMT fees as a more affordable alternative to higher registration fees. For example, Oregon will make its OReGO VMT fee an alternative to higher registration fees for fuel-efficient and electric vehicles (EVs) starting in 2028. Virginia, Utah, Hawai’i, and Vermont are actively pursuing similar strategies. A federal VMT fee is extremely unlikely in the foreseeable future because of privacy concerns, states’ limited capacity, and Congress’s lack of political will.

The latest insult-to-our-intelligence proposals to address federal highway trust fund insolvency are punitive federal EV fees. Most states have already adopted punitive EV registration fees that are far higher than what gasoline-powered car drivers pay in gas taxes. House Transportation and Infrastructure Chair Sam Graves proposed highly punitive annual federal EV registration fees: $250 for EV owners and $100 for hybrids (who also pay the gas tax). These proposed EV fees are more than double what gas-powered car owners pay on average in federal gas taxes. In 2019, the average fuel economy was 22.3 miles per gallon for an average of 11,484 miles driven. This means the average car driver’s 18.4 cents-per-gallon federal gas tax added up to $94.76 annually.

EV drivers need to pay their share, especially as EVs become a larger share of cars on the road. However, there’s a problem with trying to solve a fiscal issue on the backs of a tiny minority of drivers. Highly punitive fees would slow EV adoption without changing the projected date that the Highway Trust Fund goes broke.

Transportation for America wants to see changes in this broken program before we put more money into it, and all these ridiculous funding proposals and machinations have drawn our attention away from a central question: The gas tax is simple, efficient, directly linked to the use of our nation’s roads and highways, and is already in place. Why has Congress not had the political will to raise the gas tax for more than a generation?

To answer that, you need to ask what the federal transportation program is accomplishing with the hundreds of billions it has spent over the last few decades. And the answer isn’t pretty. The highway trust fund was created in 1956 to build the interstate highway system, which has been completed for over three decades. Since then, the program has staggered forward on autopilot with diminishing and even deleterious returns. Congestion is up in every major metro area; road deaths are up, especially for people walking; state of repair has not markedly improved; and transportation is the largest contributor to greenhouse gas emissions and is the only sector with increasing emissions. The program’s approach of doling out vast sums of formula funding to state DOTs with little accountability, and the state DOTs’ penchant for widening highways instead of investing in basic repair, is obviously not going to fix these failures.

Until we can reorient the program to address today’s needs and require greater accountability for achieving outcomes in safety, access, environmental impact, and state of repair, Americans have no good reason to support increased taxes to pay for the program. Show us something better we can get for our money. Then we’ll see public support for raising revenue to pay for it.

A transportation two-fer: Save the highway trust fund and reduce emissions 22%

With only three real possible options to stave off the looming bankruptcy* of the nation’s transportation trust fund, a Senator has proposed choosing one of them: scale the nation’s transportation program down to the size of the revenues users pay into it.

*No, the trust fund can’t actually go bankrupt—“insolvent” is the technical term. But for everyday people who cannot spend more money than they have, understanding it as “bankruptcy” is more helpful.

As we noted a few months ago, the nation’s transportation trust fund is in existential trouble. And it has been since 2008, when Congress started bailing it out with your general tax dollars. They’ve now poured in somewhere around $275 billion to cover the huge gap between how much Congress keeps spending on transportation and the far lower amount the gas tax brings in each year. And here we are again, back at square one, with the trust fund needing a massive bailout to cover a gap that will soon reach $40 billion annually.

There are three main options for tackling this problem: 1) (Continue to) deficit spend and bail it out, with every single taxpayer picking up the tab on top of whatever they pay at the pump. 2) Increase the gas tax (or create another tax) to raise revenues. 3) Live within our means by cutting spending down to the amount of revenue brought in each year.

Spend what we have, nothing more

#3 is the path that Senator Mike Lee (R-UT) has attempted to forge with a simple new bill.

His Balance the Highway Trust Fund Act would prohibit USDOT’s annual obligations (i.e, spending) for federal-aid highway programs from ever exceeding gas tax receipts to the highway account in any given year. To put that in real terms, CBO figures show that 2025’s highway spending was about $58.5 billion, which exceeds the $38.9 billion in gas tax receipts that were brought into the highway account by about $19.7 billion. So this bill would reduce highway spending by $19.7 billion.

The bill would do the same thing for transit, limiting annual obligations from the Mass Transit Account to the net gas tax receipts for each fiscal year. CBO estimates that amount would average about $5.75 billion annually during the next five-year reauthorization.

It’s debatable whether or not Sen. Lee is serious about advancing this proposal, given that he introduced it with no co-sponsors and no apparent media push (he’s proposed similar bills before). But this is, in fact, the only formal proposal in Congress right now aiming to deal with the looming bankruptcy of the highway trust fund.

But that’s not the only way to categorize this proposal.

This is also technically the most ambitious climate bill in this Congress

As we’ve pointed out repeatedly over the last few years, the IIJA supercharged highway spending and massively increased overall transportation emissions, empowering state DOTs to commit to long-shelved or dormant expansion projects. Our Fueling the Crisis analysis showed that the IIJA could cumulatively increase emissions by nearly 190 million metric tonnes over baseline levels by 2040, largely due to all the added driving from the IIJA’s massive increase in unaccountable highway spending. That’s akin to nearly 50 coal-fired power plants running for a year. All this despite the hefty praise it received from the environmental world.

That analysis has likely only gotten worse, as many of the “good” programs for reducing emissions in the IIJA have been slashed or eliminated outright by the Trump administration, like electric vehicle charging infrastructure and grants for local projects focused on reducing driving or improving access.

Here’s where the implications of Sen. Lee’s proposal get interesting.

Assuming we scale down the size of the highway and transit programs to what the gas tax actually brings in, it would potentially reduce net emissions from the Highway Trust Fund’s programs by nearly 24 million tons. That’s a 22 percent reduction compared to simply extending the bill and getting the same outcomes.

To emphasize: right-sizing the federal program would deliver more progress on emissions from transportation than any other climate bill that’s been proposed in this Congress.

Sen. Mike Lee, accidental climate advocate?

Compare those reductions to the potentially enormous growth in emissions likely to result if groups like AASHTO get their way and see the next reauthorization start at the same level of funding as in the IIJA (plus inflation). Remember: their starting point is $400 billion over five years for the highway-only programs, which is somewhere around over $210 billion more than the gas tax will bring in over those five years! If Congress did roll over and decide to hand state DOTs another $210 billion of your money on top of what you pay at the gas pump, emissions would rise dramatically.

The elephant in the room: transit funding

Unlike other proposals to kick transit out of the trust fund to try and save money, it’s notable that Sen. Lee is proposing to scale down the highway and transit programs in the same way: lowering spending on each one to the level of what the gas tax brings in. Nearly 3 cents of the 18 cents per gallon gas tax goes directly into the Mass Transit Account, and this bill would not change that—he’s not arguing to end federal support for transit funding.

As with highways, it would mean a significant cut in federal transit spending (a 66 percent reduction in federal funds, causing pain and fiscal ruin for transit systems across the country—especially smaller ones.

But consider the position a proposal like this puts most transit advocates in: most will be loudly opposed to this proposal, even when it would massively reduce emissions from highway-related spending and finally end the runaway growth of the unaccountable highway program. We transit advocates get backed into a corner on proposals like Senator Lee’s because transit funding is inextricably tied to highway funding.

And so transit advocates will continue to have no choice but to be boosters for an enormous highway program, just to keep transit funding at the same paltry level that’s far less than what we need to truly invest in the rest and build a world-class system for all of our cities, big and small. The structure of this program requires transit advocates to essentially back AASHTO’s fever dream of deficit spending on historic funding for highways, more flexibility, and even less oversight.

That’s the high price of keeping transit funding at the same levels.

People who believe that we need more and better transit in this country should not have to hold their nose and swallow insane amounts of unaccountable highway funds that undermine our transit investments. They should not have to support bank-breaking reauthorizations paid for by their grandchildren just to prop up a system that delivers such terrible results on safety, maintenance, and access to other options for getting around.

Especially when there is growing evidence that the Trump administration is killing grants for transit-related projects or failing to advance transit capital projects with money set aside by Congress. (Some breaking news we hope to expand on in the coming weeks: Trump’s USDOT has advanced zero new transit capital investment grants in the last 13 months, a new record for slowness.)

All of this points to an uncomfortable reality that has been looming for years, and which transit advocates (including ourselves) need to eventually grapple with: The federal Highway Trust Fund is not a long-term, stable solution for funding transit in this country, and the time has come to have a conversation about other mechanisms for funding transit in the future. The future of transit needs to stop being tied to the fate of a supercharged highway program that is producing terrible results for taxpayers.

Sen. Lee’s proposal reduces the size of a program that produces bad outcomes. What we need instead is a smarter, virtuous funding mechanism that, for each dollar invested, supports good investments across all modes.

Because the damage being done by this federal transportation program—funded by immense deficit spending for 18 years now—is too great to ignore.

Analysis: New CBO projection accounting for Trump administration policies shows Americans will pay billions more in fuel taxes

New CBO Projections show Americans will be paying more Highway Trust Fund taxes as a result of new policies

According to the latest projections from the Congressional Budget Office, Americans are set to pay over $80 billion more in gas taxes thanks to new transportation policies implemented under the Trump administration. The kicker? This won’t fix the Highway Trust Fund’s insolvency problem, and it will cost Americans more to deliver the same terrible outcomes on safety, maintenance, emissions, and access.

Each year, the Congressional Budget Office (CBO) projects anticipated tax information for important federal programs, detailing their fiscal status, trust fund balances, and tax revenues. One of those balances the CBO makes projections for is the Highway Trust Fund.

Early last year, the CBO made projections for the balance of the Highway Trust Fund that took into account assumptions about policies that were put into place during the Biden administration. They assumed that, with strong adoption of more fuel-efficient vehicles in line with that administration’s policy to support EV adoption, gas tax revenues would decline over time as people purchase less gas, peaking in 2026 with $44.2 billion in tax revenue before dipping down to just under $38 billion in 2035. In terms of solvency, they found that the Highway Trust Fund would reach a balance of zero dollars at some point in 2028 (though the Mass Transit Account would hit zero first in 2027).

However, a lot has changed since that last round of projections. Since day one, the Trump administration has made the rollback of what it considers to be “woke” transportation policy a core part of its agenda. With cancelled grants, delayed programs and projects, and significant rollbacks of market-shaping regulations pushed in both legislation and rulemaking, there isn’t a path the administration hasn’t pursued to enact its agenda. Many of those decisions, such as the recent repeal of the Environmental Protection Agency’s Endangerment Finding, were made with the justification that the targeted programs and regulations ultimately constituted expensive bloat that imposed costs on both the government and consumer.

At USDOT, rollbacks were powerful, effectively eliminating CAFE fuel economy standards. EV programs like NEVI and the Charging and Fueling Infrastructure program have been frozen, left in limbo, or outright cancelled. Beyond EVs, recurring grant terminations for everything from the nation’s largest public transportation project to projects that build multi-use paths deemed “hostile to motor vehicles” have led to cancellations, uncertainty, and delays nationwide. Congress has followed the administration’s lead, greenlighting the agenda with its own transportation rescissions made in the annual appropriations process and the budget reconciliation bill.

These decisions can make a major difference in people’s choices over time, but they’ve already started to have an impact. People are paying more in federal taxes. And the CBO believes that trend will continue.

Comparing newly released data from February 2026 to January 2025 projections, Americans paid over $55 million more in taxes to the Highway Trust Fund than the CBO previously projected for 2025, likely in part due to the aforementioned policies introduced by the Trump administration aimed at decreasing the efficiency of future vehicles, slowing the expansion of other transportation options, and making people drive more.

Now, the CBO projects that those same policies will result in Americans paying more in taxes—over $80 billion more over the next ten years. Instead of revenues declining with the adoption of new, more efficient vehicles, the CBO now projects that revenues for the Highway Trust Fund will actually increase. Highway tax revenues are projected to rise from $44.2 billion in 2025 to nearly $52 billion in 2035, signaling the CBO’s belief that Americans will be driving more and purchasing more gasoline, thus paying more in federal gas taxes.

In terms of the Highway Trust Fund’s insolvency, little would change. With most of the revenue increases coming in the 2030s, the additional revenue would only delay insolvency by a few weeks before the balance hits zero in 2028, barely making a dent in the looming insolvency problem.

Some think tanks and other interest groups are praising the increase in anticipated taxes as a good thing, with the Highway Trust Fund inching marginally closer to solvency without having to address the cost increases for highway projects with diminishing returns. While $80 billion is a lot of money, it is just a drop in the bucket compared to the rampant spending on highway programs out of the trust fund. Even with the new revenue, the Highway Trust Fund would still require hundreds of billions more, likely from general fund dollars, to pay for spending. More importantly, how does that money matter when the Highway Trust Fund itself is directed toward a program that produces such bad outcomes for safety, maintenance, and emissions?

It’s worth considering what the actual result of these new policies from the administration will look like for the average person. Arguably, the result won’t be noticeable, for all the wrong reasons.

Life will be no different. When you need to get somewhere, people will likely drive, get stuck in traffic, and, in doing so, lose a concerning portion of their time to gridlock and paycheck to gas and insurance bills. The (incredibly expensive) cars most people buy will be less fuel-efficient, causing their transportation costs to increase.

Thanks to our misplaced transportation safety priorities, thousands will continue to die in crashes annually, and even more will be seriously injured. The existing trends will cruise along, as there has been no structural change to how we approach transportation. Nearly 60% of the Highway Trust Fund’s tax revenue comes from the gasoline taxes that people effectively pay for every time they are at the pump. And gas isn’t getting any cheaper in 2026. When Americans are getting increasingly annoyed with just how expensive daily life is, we are now moving our transportation policy to be even more extractive of Americans, expecting them to pay for literally hundreds of billions more gallons of gas just to get around. But hey, at least you paid for a few extra weeks of solvency for the Highway Trust Fund.

Axing federal transit funding won’t solve the Highway Trust Fund’s fiscal woes

The Trump administration’s proposal to eliminate the core pillar of federal transit funding won’t fix the Highway Trust Fund’s budget woes. Other proposals put forward by this Congress so far haven’t helped much either.

Historical primer

We spend a lot of money on highways, but when it comes to real performance, we do not get a lot out of all that spending. After over a trillion dollars spent over the last 30 years, our infrastructure conditions and road safety are not any better. Part of the reason why we are able to spend so much money is that the Highway Trust Fund (HTF) has a dedicated revenue source that provides consistent payouts—whether or not the funds are needed for the purpose. While it is politically durable, the Highway Trust Fund is not reliable.

Ever since its inception in 1956, the HTF has struggled to cover the repair bill of the massive federally subsidized highway network that we continue to expand today. This first came to a head in the early 1980s, when the HTF, funded at that time by a four-cent per gallon gas tax, was running out of money to both pay the repair bill for the first generation of highways built in the 1950s and 1960s and continue its rapid rate of expansion led by state DOTs. The choice then was to either borrow from the general fund, raise taxes, or match spending to what funds come in and focus on repairing existing assets. In 1983, during the Reagan administration, Congress chose to raise taxes.

Raising taxes, however, is unpopular, and 1983’s five-cent increase in the gas tax was only made possible by a coalition of pro-transit members of Congress who conditioned their supporting votes on one cent of that increase going to transit, thus creating the Mass Transit Account of the Highway Trust Fund. Since 2008, instead of having those difficult conversations, Congress has just taken more than $275 billion from all taxpayers to cover the yawning deficit. Despite the fact that transit users—along with all other taxpayers—have been massively subsidizing highway expansion spending for nearly 20 years, transit is being targeted for removal from the Highway Trust Fund.

As a reminder, the issue is highway spending

Eliminating the Mass Transit Account would completely fail to solve the Highway Trust Fund’s deeper problems. The only way out of the transportation funding shortfall is for Congress to once again consider its three options:

Take from the general fund and deficit spend to keep the status quo going
Raise taxes on vehicles that already cost far more than many families can afford during an affordability crisis.
Adjust spending down to match revenues and refocus on repair and reducing highway asset liabilities

We’re in this mess because previous Congresses chose to take money from all taxpayers to prop up a program that is failing to deliver on its promises of safety, state of repair, and mobility. For nearly 20 years Congress has punted on the hard conversations we need to have about the purposes of this program and what we get for our money. And so the nation’s transportation trust fund is rocketing to insolvency, and these proposals are merely rearranging the deck chairs on the Titanic. The unavoidable truth is that we spend ~$20B more per year than the gas tax brings in on just the highway programs alone. Rep. Graves’ recent idea to add new taxes on cleaner vehicles, like hybrids and EVs, would barely make a dent in that number. USDOT could tell Congress to end all transit funding, passenger rail, competitive grants, and scores of other smaller programs and the trust fund would still be speeding toward insolvency. There are serious ways to address this problem, but these proposals from USDOT are not it.

The highway trust fund isn’t on life support—it’s been dead since 2008

Our failing federal transportation program is supposed to be completely paid for with gas taxes, but since 2008, Congress has taken an additional $275 billion from taxpayers (on top of all gas taxes) to cover the difference between gas taxes and their spending. And it’s only getting worse.

You may have heard about the looming “fiscal cliff” for the country’s federal transportation trust fund in 2028. We can climb a cliff—but this is more like a chasm: The Congressional Budget Office projects that, by 2027, the gap between trust fund revenues and spending will reach $40 billion annually, resulting in an overall deficit of more than $240 billion by 2033. To put that $40 billion gap in perspective, the entire federal-aid transportation program spends about $77 billion per year.

This deficit is happening for one basic reason: Congress keeps spending far more than the gas tax brings in.

But first, how did we get here?

There’s a much longer version of this story, but let’s start with the shorter one.

Every time you buy gas, 18.4¢ per gallon (and 23.4¢ for diesel), as a “user” of the transportation system, you pay into a protected federal trust fund for transportation called the Highway Trust Fund.¹ (Despite its name, the fund also has a Mass Transit Account because transit benefits drivers too by taking all of those potential drivers off the road.) There are other small fees on tires and related things, but 90 percent of the trust fund’s money must come from fees charged to the users of the system.²

Here’s how trust funds work: Users pay fees directly into a protected trust fund over a long period of time, and then those funds must be spent to benefit those users. The users (those who buy gasoline) pay directly for the system (roads and transit systems.) This allows the transportation program to be protected from the typical annual appropriations fights over a program’s funding levels. Gas taxes roll into the trust fund and then get distributed back to states via a multi-year authorizing law, usually five years for transportation. For example, the Infrastructure Investment and Jobs Act of 2021 allocated those anticipated user fees for five years.

Since its inception, the bedrock principle of our federal transportation program has been that the user (through the trust fund) covers 100% of the cost of the federal transportation program for highways and transit. And, other than a rocky start in the 1950s and 60s, users did cover that full cost for years. Until 2008.

The trust fund is not “threatened”—it died in 2008

In 2008, after rosy projections of growing gas tax revenue by Congress in the 2005 surface transportation reauthorization law failed to materialize as growth in driving slowed, Congress was forced to make an emergency bailout of the trust fund, transferring $8 billion in general funds into it to keep it from becoming insolvent. ³ But this September 2008 bailout just turned out to be just the first of many. Flash forward to 2025, and Congress has now made a total of nine transfers totaling $275 billion—taken from all taxpayers, regardless of how much they drive or how much fuel they purchased—to keep the “trust fund” solvent.

To put that number in perspective, the total price tag for the entire five-year 2005 federal transportation law (SAFETEA-LU) was only $244 billion. The reality looks even worse if you start to consider its status without those nine transfers:

The “user pays’” principle isn’t on life support—it died a long time ago.

Here are two basic reasons why:

First, the gas tax hasn’t increased since 1993, even as the fuel efficiency of vehicles has improved, and inflation has steadily reduced its purchasing power. ⁴

This means that annual gas tax revenue declined by $10 billion per year from 2010 to 2025. There’s also compelling evidence that the largest factor in the erosion of gas tax value “is the massive increase in road construction costs—the cost-per-mile of the United States highway system grows larger each year.”

Second, 2008 was also the beginning of a structural imbalance created by how much the gas tax was bringing in and (most importantly) how much money Congress was committing to spend each year. Rather than keeping overall spending matched 1:1 to the amount of gas taxes projected to come in, Congress has continually committed to spending far more than the gas tax brings in. State DOTs received 50 percent more in flexible formula funding in the 2021 IIJA compared to the 2015 FAST Act, which was itself a 15 percent increase over MAP-21 in 2012. All while gas tax revenues were failing to grow at the same rate.

Everyone has paid to fill the gap since 2008, whether you’ve ever bought a gallon of gas

Back in the late 2000s and early 2010s, the loudest debate during reauthorization was about the states who received more gas tax revenue back than they paid into the program. But because of the $275 billion taken from all taxpayers to plug the gaps in the trust fund, this phenomenon simply no longer exists. Every state is receiving more than they paid in gas taxes. The Congressional Research Service estimates that more than a quarter of all “trust fund” spending has come not from users but from general tax dollars or other sources since 2008. That number has gotten worse in recent years: when it expires in 2026, close to a third of all IIJA spending will have come from sources other than users.

And despite what you will surely hear about the #1 problem being that we spend gas tax revenues on non-highway projects, Congress is spending $20 billion more per year than the gas tax brings in on highway formula programs alone.

One more time: The trust fund and its core concept are not mostly dead; they are completely dead.

What’s next for the trust fund

Because of this looming fiscal fiasco, the loudest refrain you will hear from the transportation industry and lobby groups and Congress over the next two years will be about money. You won’t hear much about making dramatic changes to get better outcomes out of this program, but you will see headlines and quotes about how we need to “find more money,” and “solve the funding issue,” and “address the trust fund’s insolvency.” Indeed, the trade group representing state DOTs has already staked out this position: We absolutely must grow the size of this bankrupt program, and taxpayers (every one of you!) need to collectively find $210 billion for them to keep doing the same thing that fails to deliver results. AASHTO’s proposal:

Why is the default assumption that we have to continue increasing the size of a program that no longer pays for itself while failing to deliver on what matters?

There are only three basic options for moving forward

As Taxpayers for Common Sense wrote a few weeks ago, “the Highway Trust Fund’s looming insolvency is not just a transportation problem—it is a taxpayer problem.” There are three broad options at this point:

Take billions more from all taxpayers (whether they buy gas or not) by deficit spending, transferring billions into the trust fund, and having all taxpayers pick up the tab
Take billions more from taxpayers by raising revenues in some fashion (increasing gas taxes or establishing new taxes)
Cut the size of the program’s spending down to the amount of revenue brought in each year and live within our means

These first two options require taking more money from taxpayers to prop up a federal program that is failing to move the needle on repairing our crumbling infrastructure, reducing congestion, reducing emissions, or improving safety.

It’s time to start thinking about that third option: Scale the program down to the size of what the gas tax brings. Similar plans have been suggested before, including a slightly different 2014 proposal by Senator Mike Lee (R-UT) and 28 Senate Republicans to mostly phase out the federal gas tax—except for a few cents to fund interstate maintenance and repair only—and leave it to states to make up for the lost funding.

End this program as we know it

There was a time in T4America’s history that we joined the chorus of those who thought Senator Lee’s above idea was a terrible one. Back then, we believed—as a lot of others still do—that we just had to accept billions in destructive highway building and bad outcomes in order to get some transit funding, pennies for bike lanes or sidewalks, or competitive grants for creative, multimodal projects. But we simply cannot continue ignoring this program’s damage and terrible performance.

It’s time to wind down the federal program.

As we say in our platform for reauthorization, “this program doesn’t need a facelift; it needs to be blown up and replaced with something completely new.” It has completely failed to deliver on its promises, and it’s taken obscene amounts of money from all taxpayers above and beyond what vehicle owners pay at the pump to do it.

Scaling the program down to the size of incoming gas tax revenues is probably the best first step toward transitioning to a radically different federal program oriented around setting priorities, picking projects that will deliver on those outcomes, and providing greater accountability for taxpayers. This is the only conversation about funding that T4America will be having: What are the best possible options for scaling down the federal transportation program and creating something new?

This program has been a bad deal for a long time, and it’s time we stop accepting it. It’s not time to rescue the trust fund, it’s time to write its eulogy.

Stop funding transit like it’s 1982, Congress

Congress has suggested that they may focus on infrastructure in an upcoming stimulus bill. It’s not entirely clear what Congress will do—or if spending on infrastructure is the right way to stimulate the economy right now—but if Congress does want to pass an infrastructure package, they should stop spending money like it’s 1982.

Upset about this broken status quo? Sign our petition urging Congress to fund public transit and highways equally.

For decades, the U.S. has funded transportation based on the idea that the user pays for the infrastructure through a fee—the gas tax, which has filled the Highway Trust Fund since 1956. In 1982, Congress struck a deal to raise the gas tax, but 1 cent of the 5 cent increase would be dedicated to transit, with the remaining spent on highways. This established the infamous “80-20 split” in transportation spending: highways get 80 percent of funds, and transit only gets 20 percent (though in reality, transit gets much less).

Since then, transportation spending has essentially stayed the same. In the most recent spending bill, Congress appropriated $48.6 billion for highways and only $10.2 billion for transit. But the entire logic behind highways receiving a substantially larger portion of the pie—i.e. drivers were paying for it—came crashing down in 2008, when the trust fund ran out of money because the gas tax was no longer sufficient to cover expenditures. To stay afloat, the trust fund has received huge infusions of general taxpayer dollars totaling $144 billion.

Our transportation dollars are no longer based on a user fee paid by drivers, yet the 80-20 funding split persists. This no longer makes any sense. Even the influx of transportation funds from the Recovery Act in 2009 all came from deficit spending from the general fund—not a single dime came from gas tax user fees—yet the vast majority of funding (roughly 75 percent) went to roads.

Why should we continue to honor a nearly 40-year old system based on a nearly defunct user fee? If Congress pursues an infrastructure package or reauthorization as part of a stimulus bill, it will be wholly outside a user fee construct. Considering that, why shouldn’t transit receive more than 20 percent of transportation dollars? Why shouldn’t transit receive 80 percent or even 100 percent of transportation dollars? We are not saying that other modes should not receive any money. The point is that all assumptions should be questioned and funding should go to projects that create jobs quickly in a stimulus bill and support today’s needs and goals, not those of 40 years ago.

It’s time for Congress to abandon this obsolete, untenable split in transportation funding.

Congress has already upended status quo

Whether legislators realized it or not, the recently passed $2 trillion CARES Act has already disrupted the status quo to deal with immediate needs. The act includes $25 billion in direct, emergency assistance for transit at a time when revenue is plummeting. That’s more than double what the federal government usually spends on transit in a year. Normally, transit agencies have been barred from using federal funds for operations, typically only providing funds for maintenance and capital (like building new stations, or buying new buses).

With the passage of the CARES Act, Congress broke with precedent and provided essential funding for transit operations. But we should go further, and end the baseless 80-20 funding split. After all, this pandemic has made it obvious that transit is essential, and it should be funded as such.

With 2.8 million essential workers relying on transit to get to their jobs and countless others depending on it to access food and health care, we need transit to be robust, reliable, and frequent. And we’ll need transit to get tens of millions more people moving once this virus is contained. But giving transit only 20 percent of the pie just won’t cut it.

According to the Federal Transit Administration, our transit systems face a $98 billion backlog in deferred maintenance. Unlike the road maintenance backlog which has more to do with state DOTs prioritizing new roads instead of maintenance, the transit backlog is due to insufficient funding. There is also great demand for more transit capital funding, and operating support will be critical to ensure that agencies can continue to provide this invaluable service and limit crowding.

We have underfunded transit for decades, and doing so has left too many communities with deteriorating systems and infrequent, unreliable service. It’s time to get rid of the 80-20 split. To get through this crisis and build a robust economy again, we’ll need to fund transit equitably and treat it like the vital public good that it is.

Oregon DOT provides a wake up call for local leaders in other states

In a move that should raise alarm bells for local leaders in other states, last week the Oregon Department of Transportation decided where to spend nearly $200 million in new money from last year’s FAST Act on their road system with limited to zero public engagement.

I-5 over the Columbia River in Oregon. Flickr photo by Doug Kerr.

The FAST Act, the five-year transportation bill passed by Congress in late 2015, provided a level of funding certainty for state transportation programs that they’ve not had in years. Thanks to a $70 billion transfer from general taxpayer funds into the Highway Trust Fund, the FAST Act also provided a slight increase in funding for each state. This followed on the heels of $75 billion in transfers total over the prior seven years, just to keep the trust fund solvent.

Yet simply funneling more money into the same system won’t necessarily ensure better outcomes for the taxpayers’ investment or that local priorities will be addressed, and Oregon’s actions could be a preview of what might happen in countless other states, deciding not to equitably distribute the new funds to state and local priorities.

Rather than improve the underlying policies that directs each state’s transportation investments, Congress chose to largely direct the FAST Act’s increased funding into new freight programs, the largest of which is being distributed to states by a formula wholly unrelated to freight needs or merit. (This was one of the provisions we called out in our post covering ten things to know about the FAST Act. –Ed.)

This new National Highway Freight Program will dole out more than $1 billion per year to state DOTs with zero relation to the value or tonnage of the freight moved within its borders. It also predetermines that the solution to any freight problem is highway-related by directing all but 10 percent of each state’s funding to highway development only, disregarding the fact that these funds were not collected from gas taxes.

In addition, the increase in funds in the main highway programs are also directed largely to state DOT owned roads (interstates and highways). Thus, local governments must be prepared to ensure their priorities are addressed and the states share in their newfound resources, however large those may be.

Case in point: Oregon.

As Bike Portland originally reported back on 3/17, The Oregon Department of Transportation (ODOT), with the approval of its Transportation Commission, programmed $196 million in new funding from the FAST Act on Thursday, March 17. While ODOT is correct that the majority of its new funding is from the highway freight formula program, the agency has misinformed (pdf) their audience by stating the funds must be allocated to “freight-related projects on high-volume, high-priority truck freight routes, primarily the Interstate.”

Congress provides ODOT, and every other state, great flexibility to direct federal highway dollars to priority projects — state or local, highway or non-highway. Every state has the flexibility to transfer 50 percent of its funding for a highway program to a separate highway program such as the highly flexible and locally accessible Surface Transportation Program, which can be used on almost any type of important project.

While nearly 40 percent of the additional $200 million in Oregon will support fix-it-first projects – a priority that Transportation for America supports —95 percent of the new funding will likely go to state-owned highways and almost nothing is done to improve transparency and accountability for the public. To wit: the list of project types receiving funds does not provide a discussion or rationale for which projects will receive the new funding or why any particular project category received funding.

The murky process of picking projects in a way that is nearly impossible for the public to decipher will continue.

ODOT will not begin spending the nearly $200 million in newly programmed funds until 2018, which provides Oregon’s local leaders two years to build their case to receive a greater portion of the new funding from the FAST Act for their priorities.

But today and tomorrow, Oregon’s example illustrates why local leaders in other states need to proactively engage their state representatives and DOT to ensure their state’s new funding from the FAST Act is shared and supports both local and state priorities.

Click here to review the amount of highway funding directed to your state DOT from the FAST Act

President Obama releases robust final budget; summary included

Today, the White House released President Obama’s fiscal year 2017 (FY17) budget proposal, the final of his presidency. This budget adheres to the $1.07 trillion spending cap that resulted from the bipartisan two-year budget deal agreed to last November. The President’s budget proposal either falls in line with or exceeds FAST Act funding levels, increases transit and rail funding, and funds TIGER (the FAST Act does not authorize the program), among other programs. The budget also calls for the creation of a 21st Century Regions program, a clean communities competitive grant program and funds the President’s 21st Century Clean Transportation Plan.

Speaker Ryan (R-WI) has asked congressman to maintain the funding levels agreed to last November, though there are signals that some may seek additional cuts.

Read a more detailed analysis here.

The 1 thing you need to know about President Obama’s clean transportation plan

On February 4, the White House released President Obama’s 21st Century Clean Transportation System plan to be included in his FY2017 budget proposal expected out on February 9. The President asserts that his budget proposal will strengthen the nation’s transportation fund through one-time revenues from business tax reform and a $10 per barrel fee on oil, and make large investments in transit and improve funding for local and regional governments.

“This is a new vision. We’re realistic about near-term prospects in Congress, but we think this can change the debate,” one senior administration official said.

The announcement comes two months after the passage of the 5 year surface transportation bill known as the FAST Act. However, Congressional leaders have not expressed willingness to consider the proposal.

House Majority Whip Steve Scalise (R-LA) made this point clear. “President Obama’s proposed $10 per barrel tax on oil is dead on arrival in the House.”

What the plan proposes

The plan includes a wide range of innovative solutions. It would refocus federal investments to reduce congestion, reform the existing transportation formula programs, and invest in competitive programs, including the popular Transportation Investment Generating Economic Recovery (TIGER) program. It would also increase investments in mass transit funding by $20 billion annually, provide $2 billion for an autonomous and low-emission vehicle pilot, and add $10 billion per year to reform local and regional transportation programs. The latter would include new discretionary grant programs for regions that lower emissions and better link land use decisions with transportation investments.

To pay for these investments, revenues from a $10 per barrel fee paid by oil companies would be phased in over 5 years. During the development of the FAST Act, Congress was unwilling to even hold a floor vote on increasing transportation user-fees, which hasn’t been raised in over 23 years.

Day 1 Wrap Up: Congressional Conference Committee Action

This morning the conference committee for the surface transportation authorization bill met for the first time. The first order of business was appointing Representative Bill Shuster (R-PA) – chair of the House Transportation & Infrastructure Committee – as the conference chair and Senator Jim Inhofe (R-OK) – chair of the Senate Environment & Public Works Committee -as the vice-chair.

Possibly the most revealing item covered during this first official meeting was an early statement from Chairman Shuster (R-PA) that the conference plans to work diligently through the Thanksgiving recess that starts this Thursday, November 19th, to meet a self-imposed deadline of Monday, November 30. The proposed timeline will allow the House and Senate to vote on final passage for the conference agreement before MAP-21 expires on Friday, December 4th (MAP-21 expires this Friday, November 20th, but the House has already passed a bill to extend the authorization to December 4 and the Senate is expected to follow suit today or tomorrow).

There are still a few sticking points that need to be resolved and came up today during each conferee’s opportunity to speak today. Many hold differing positions on the low funding levels for this authorization as well as the non-transportation generated revenue used to pay for the bill. Those in the Northeast took issue with a House provision to remove transit funding dedicated to high-growth states in the northeast and place it in a national competitive bus and bus facilities program. And others, while not objecting to including passenger rail authorization in the surface authorization for the first time ever as expected by this bill, wanted to include greater reform at Amtrak.

We do not expect any further public meetings until the Members of Congress return on November 30, at which time the conference is expected to have finalized this bill. This means that much of the work on the conference report will happen out of view and behind closed doors. If interested, we advise that you contact your member over the Thanksgiving recess and visit them in person if you can about items of importance for you and your community.

Senate Conference Members

Environment & Public Works Committee

Republicans

Jim Inhofe (R-OK)

John Barrasso (R-WY)

Deb Fischer (R-NE) – also a Commerce Committee member

Democrats

Barbara Boxer (D-CA)

Commerce Committee

Republicans

John Thune (R-SD) – also a Finance Committee member

Democrats

Bill Nelson (D-FL) – also a Finance Committee member

Banking Committee

Democrats

Sherrod Brown (D-OH) – also a Finance Committee member

Finance Committee

Republicans

Orrin Hatch (R-UT)

John Cornyn (R-TX)

Democrats

Ron Wyden (D-OR)

Chuck Schumer (D-NY)

Other Conferees

Republicans

Sen. Lisa Murkowski (R-AK)

Democrats

Dick Durbin (D-IL) – Democratic Whip

House Conference Members

Transportation & Infrastructure Committee

Republicans

Bill Shuster (R-PA)

Reps. John J. Duncan, Jr. (R-TN)

Sam Graves (R-MO)

Candice Miller (R-MI)

Rick Crawford (R-AR)

Lou Barletta (R-PA)

Blake Farenthold (R-TX)

Bob Gibbs (R-OH)

Jeff Denham (R-CA)

Reid Ribble (R-WI)

Scott Perry (R-PA)

Rob Woodall (R-GA)

John Katko (R-NY)

Brian Babin (R-TX)

Cresent Hardy (R-NV)

Garret Graves (R-LA)

John Mica (R-FL)

Barbara Comstock (R-VA)

Democrats

Peter DeFazio (D-OR)

Eleanor Holmes Norton (D-DC)

Jerrold Nadler (D-NY)

Corrine Brown (D-FL)

Eddie Bernice Johnson (D-TX)

Elijah Cummings (D-MD)

Rick Larsen (D-WA)

Michael Capuano (D-MA)

Grace Napolitano (D-CA)

Daniel Lipinski (D-IL)

Steve Cohen (D-TN)

Albio Sires (D-NJ)

Donna Edwards (D-MD)

Ways & Means Committee

Republicans

Kevin Brady (R-TX)

Dave Reichert (R-WA)

Democrats

Sander Levin (D-MI)

Energy & Commerce Committee

Republicans

Fred Upton (R-MI)

Markwayne Mullin (R-OK)

Democrats

Frank Palone (D-NJ)

Financial Services Committee

Republicans

Jeb Hensarling (R-TX)

Randy Neugebauer (R-TX)

Democrats

Maxine Waters (D-CA)

Other Committees

Republicans

Mac Thornberry (R-TX)

Mike Rogers (R-AL)

Bob Goodlatte (R-VA)

Tom Marino (R-PA)

Darin LaHood (R-IL)

Glenn Thomson (R-PA)

Will Hurd (R-TX)

Lamar Smith (R-TX)

Democrats

Loretta Sanchez (D-CA)

Zoe Lofgren (D-CA)

Raúl Grijalva (D-AZ)

Gerry Connolly (D-VA)

House Committee passes a multi-year surface transportation bill

On October 23^rd, the US House Transportation & Infrastructure Committee passed out of committee a long-term surface authorization. The bill, the Surface Transportation Reauthorization and Reform Act (HR 3763), authorizes the federal surface transportation program for six years, and recommends flat line funding plus inflation over the life of the bill.

Transportation for America (T4A) published a summary of the bill (pre-mark-up) for members, click HERE to download it.

Ultimately, the big-four agreement – a bipartisan agreement determining which amendments would be allowed, accepted or rejected that exists between the Chairmen and Ranking Members of the full- and subcommittees – proved to hold firm during yesterday’s nearly six-hour meeting.

Of the 160 plus amendments offered during the mark-up by members of the committee, the Chairman agreed to only three:

adding tourism to state and MPO planning scopes,
exempting weight limits for emergency vehicles, and
including a performance metric on urban highway state of good repair.

Only two received votes and both failed by large margins. In return for assurances by Chairman Shuster (R-PA) that the Members’ concerns would be taken care of before the bill reaches the House floor, nearly all Members offered and withdrew their amendments.

Of importance, Representatives Davis (R-IL) and Titus (D-NV) offered an amendment to increase the amount of funding directed to metro regions by $9 billion over the life of the bill and improve the transparency and project selection process for regions under 200,000 in population. Download the Davis-Titus summary memo HERE.

Though Rep. Davis (R-IL) had the votes yesterday to pass this amendment, he offered and withdrew the amendment after it gained the largest number of bipartisan statements of support during the markup (those came from Reps. Davis, Titus, Frankel (D-FL), Edwards (D-MD), Rouzer (R-NC)). Chairman Shuster signaled that he is open to working with the bipartisan group to make improvements to this area of the bill as it moves forward in the process.

There were also a number of non-controversial amendments included in the manager’s amendment prior to the start of the meeting. Notable amendments include:

Sires (D-NJ) and Costello (R-PA) – amends the planning section to encourage MPOS to develop congestion management plans that develop strategies and projects that improve transportation access during peak hour travel and would include employers and representatives of low-income households.
Curbelo (R-FL) and Titus (D-NV) – amends the safe streets language to encourage reporting on the development and implementation of safe streets at the state level.

Despite a number of statements of support from various organizations, T4A finds that this bill doesn’t meet the forward-looking federal policies needed to strengthen the economic and social prosperity of our nation’s communities. We will continue to work to ensure the House STRR Act and the Senate DRIVE Act move in our direction and I thank you for your support.

US Senate Transportation Authorization – T4A Update

The US Senate continues to debate the federal surface transportation bill this week, with a series of votes taken last night by the full Senate. Individual senators filed over 200 amendments and T4America continues to track the latest developments on those amendments. We have compiled a brief update on where things stand and provide information on three amendments that we know would spur innovation, access and local control.

**It is rumored that another manager’s amendment package will be offered in the near future. T4A will update this information as needed.

Transportation Funding Timeline Update: Transportation funding expires this Friday and the House announced this morning that they intend to pass a 3-month extension to match the Senate’s; setting up a new October 29 transportation funding deadline.

Last week, Majority Leader McConnell (R-KY) introduced what is expected to be the first of potentially two or more manager’s amendment packages. Manager’s packages serve as legislative vehicles to modify a piece of legislation in committee or on the floor, wholesale. This first manager’s package makes a number of changes, including maintaining the historic 80/20 highway and transit funding split; increases funding for the FTA High Intensity/Fixed Guideway State of Good Repair Formula program by $100 million (paid for by cutting TIFIA and the Assistance for Major Projects by $50 million each) and requires 50% of the off-system bridge set-aside funding in the STP program to be used on bridges that are not on the federal-aid highway system.

Last Sunday, the Senate dispatched a couple of non-germane amendments, but voted to allow Senators to vote on whether or not to tie the Ex-Im Bank authorization to the highway authorization. Late last night, the Senate voted and approved that plan (64-39).

Under this new modified manager’s package, T4A believes that it is unlikely that few if any of the 200+ plus amendments filed by Senators will be considered or voted on. However, we do anticipate the introduction of a third manager’s amendment which will reflect additional changes. T4A continues to work to increase local control, innovation and access to jobs and opportunity through three primary amendments. They include the following:

Wicker-Booker STP local control amendment (corresponding fact sheet by USCM on changes to metro level funding)
Murray TIGER authorization amendment
Donnelly Job Access planning amendment (search for S. Amdt 2434, 2435 and 2436; this one is messy, our apologies)

Update: 5 Issues to Watch (for more information, please refer to T4A’s Member post on 7/23/15):

Pay-fors – Since the last post on 7/23/15, a number of items have shifted. A few provisions, considered poison pills, were removed, including the $2.3 billion that came from denying those with felony warrants social security benefits and $1.7 billion that came from rescinding unused funds for TARP’s Hardest Hit Fund. These rescissions leave the authorization with $43.7 billion, all of which are generated outside of the traditional transportation-user fee system. The measure would provide enough additional HTF revenues to provide the first three years of highway and transit investment, but Congress would be required to raise additional resources before October 2018 to be able to fund the final three years of the DRIVE Act’s authorized spending.

Transit funding – Changes in the manager’s package increased the levels of transit funding to be 24% of the authorized levels overall and 24% of any new funding generated annually.

Freight –The DRIVE Act creates a robust freight planning process that directs states to examine efficient goods movement and identify projects needed to improve multimodal freight movement. However, despite instituting a multi-modal freight planning process, the new National Highway Freight Program would require 90% of the funding go to highway-only projects rather than to multimodal projects using a performance-based system. What impact will this have?

Take, for example, the non-highway freight needs in the State of California. Ten percent of California’s funding would be only $9.3 million in 2016, growing to $23 million in 2021. Comparitively, one multimodal project at the Port of Long Beach in California to remove a railroad bottleneck and build more on-dock rail capacity cost the Port $84 million. T4A views this policy as a missed opportunity and not consistent with T4A’s freight policy.

Overall, due to removal of the TARP Hardest Hit Fund, the bill’s overall investment levels needed to be reduced. Under the first manager’s package, the freight program was set to receive $1.5 billion in FY2016 growing to $2 billion in FY2018. The program would now receive $991.5 million in FY2016 and increase to 1.9 billion in Fy2018.

Passenger Rail – No changes to note from the last update on 7/23/15.

Assistance for Major Projects (AMP) – Funding decreased by $50 million per year to increase funds for FTA’s High Intensity/Fixed Guideway State of Good Repair Formula program. AMP would now be authorized at $250 million in FY16 and rise to $400 million in FY2021.

*NEW* TIFIA – The initial manager’s package introduced early last week would cut TIFIA funding from $1 billion to $500 million per year. Removing the TARP Hardest Hit Fund and other payfors required additional cuts, which senate authorizers took out of the TIFIA program. Those cuts, plus the increase to the FTA’s High Intensity/Fixed Guideway State of Good Repair program, result in an overall authorized funding level for TIFIA at just $300 million per year over the life of the bill.

Senate Passes Cloture; 5 Things We’re Watching

***Please note, at 10:00am T4A received McConnell’s substitute amendment, which means that a number of these items may have changed. We’ll keep you updated as it proceeds.**

Last night, the US Senate passed a procedural vote called cloture. Like a starting pistol in a race, this means that they can now start debating, amending and eventually pass a federal surface transportation bill out of the Senate. While many things can, and will, happen over the next few days, there are a number of topics that Transportation for America is watching.

Want to know how your Senator voted on cloture? Click HERE.

1.Payfors – DC parlance for real and imaginary ways to pay for this bill.

At this time, there appears to be a wide-ranging list of payfors that run as small as $172 million up to $16 billion. Some of these include items like such as rescinding unused TARP funds or extending fees for TSA. There do not seem to be many that keep the traditional tie between users of the system and payments into the system.

The mass transit account appears to be running out of funding well before the highway trust fund. Initial T4A analysis seems to indicate that the legislation pulls in all 10 years of the proposed funding to pay for 3 years of the highway trust fund and 1.5 years of the mass transit account.

APTA transit funding table in current Senate transportation legislation

The legislation also appears to sell 101 million barrels out of the 693.7 million barrels of the Strategic Petroleum Reserve (SPR) between 2018 and 2025 to bring in $9B over 10 years. Critics of this funding scheme assert that we are selling the oil when prices are at record lows, making it a foolish idea. Sen. Murkowski (R-AK) is reportedly one of those critics.

Originally, this legislation withheld Social Security payments from recipients that are subjects of a felony arrest warrant and for whom the state has given notice that they intend to pursue the warrant, raising $2.3 billion over 10 years. T4A has heard that Senate negotiators have removed this provision due to the advocacy of a number of social equity and civil rights groups.

2. Transit
T4A and the larger transportation community have several concerns about this title, the main ones are:

US Banking Democrats chart on modal share under currently proposed Senate legislation

First, the DRIVE Act fails to provide public transportation with 20% of the new revenue dedicated to growth, which is a historical guarantee dating back to President Reagan’s agreement in 1982. Public transportation receives only 6% of the revenue derived from the future funding growth (see Senate Banking Democrats chart). U.S. DOT estimates that the Mass Transit Account ends the third year of the bill (FY 2018) with a negative balance of $180 million. Senator Boxer is reportedly negotiating a fix with Senate Republicans that will increase that percentage.

Second, projects with private funds get to “skip the line” for federal money, providing a major incentive for privatized service. The existence of a new expedited process could entice cities to pursue transit privatization on a large scale by using P3s to operate transit service. The labor community has expressed strong opposition and may oppose the entire bill if this provision isn’t removed.

Third, this legislation forces the Federal Transit Administration (FTA) to wait 6 months before increasing oversight of at-risk projects. Sec. 21015 requires the FTA to wait for a project to fail 2 consecutive quarterly reviews before providing more oversight to a project that is going over budget or falling behind schedule.

3. The Freight program

This legislation includes all modes of freight, including pipelines for the first time. It also requires the establishment of a new multi-modal freight network within 1 year of enactment, the establishment of which appears to be similar to the creation of the existing freight network (as well as a re designation of the existing highway freight network). It does, however, define economic competitiveness by the amount of traffic moved and not economic outcomes and will fund projects that reduce congestion, improve reliability, boost productivity, improve safety or state of good repair, use advanced technology or protect the environment on the national highway freight network.

You’ll recall that T4A sent out an action alert to keep the TIGER program multimodal and not let the US Senate Commerce Committee use it for freight-exclusive purposes. We’re happy to report that effort was successful, though the TIGER program is still not authorized or funded in the transportation bill.

4. Passenger Rail
This legislation authorizes passenger rail funding for the first time ever in a federal surface transportation reauthorization. The legislation calls for $1.44B in 2016 and growing to $1.9B in 2019. It maintains a national system and provides for clear cost accounting among the 4 business lines of Amtrak of the corridor, state-supported and long-distance trains. Provides for up to 6 new passenger rail routes on a competitive basis and for the first time makes operational costs eligible for grants.

5. AMP – Assistance for Major Projects
This is a new project for highway or transit projects that cost at least $350M or 25% percent of state highway apportionment (10% in a rural state). Applications should be reviewed based on consistency with federal goals, improvement to the performance of the system, is consistent with the statewide plan, can’t be completed without federal help and will achieve one or more of the following:

generate national economic benefits outweigh cost,
reduce congestion,
improve the reliability of movement of people and freight, or
improve safety

Grants under AMP must be at least $50M, with a rural guarantee of 20%. Eligible applicants for AMP include states, local governments (or group of locals), tribal governments, transit agencies, port authorities, public authorities with transportation function and federal land management agencies. It is not yet clear if this language is specific enough to include MPOs.

Amendments to be offered: T4A staff is monitoring a number of potential amendments. One of which (offered by Senators Wicker (R-MS) and Booker (D-NJ)) would increase the ability of communities to fund projects through the Surface Transportation Program. We strongly urge you to call your Senator and tell them to co-sponsor that amendment.

ICYMI: T4A and SGA Host Federal Policy Webinar; Materials Inside

Yesterday, Smart Growth America and Transportation for America hosted a webinar to review congressional action on the federal surface transportation authorization. If you were able to attend, you will recall that we mentioned how the US Senate is poised to consider the authorization before the full Senate next Tuesday. That continues to be the current timeframe for Senate consideration.

Access the webinar powerpoint here.

As a T4A member, you can access the webinar anytime through this page.

Two action items stemming from that conversation include:

It is highly likely that T4A will be issuing a number of action alerts next week. While we don’t have legislative language on a number of potential amendments, we anticipate movement on issues of local control, freight, TAP, transit funding and TIGER. Member support would be greatly appreciated.
The National Complete Streets Coalition is requesting support to tell FHWA to make more inclusive streets that are designed to be more livable. You can register your comments here: bit.ly/NHSdesign (this weblink is case-sensitive).

Join us on Thursday for an inside look at transportation reauthorization in Congress

The current federal transportation bill will expire on July 31, 2015, with the nation’s transportation fund reaching insolvency near the same time. Join us Thursday for a public conversation about what’s likely to happen in Washington and what it all means for your community.

In the coming weeks Congress will likely be negotiating an extension to MAP-21 before its July 31 expiration while also debating the policies in a long-term transportation bill — a process that has already started. How will the decisions made in Congress and the current political landscape impact local transportation projects, Complete Streets, and transit-oriented development?

Join Smart Growth America and Transportation for America for a special open conversation about what’s happening right now in transportation policy this Thursday, July 16, 2015 at 4:00 PM EDT.

You can register for the event here.

Hear from Joe McAndrew, Policy Director at Transportation for America; Christopher Coes, Director of LOCUS; and Stefanie Seskin, Deputy Director of the National Complete Streets Coalition. Each speaker will focus on a different aspect of the current negotiations.

The federal transportation bill will have huge implications for development across the country. Join us on Thursday to learn more about where Congress currently stands and what you can do to help shape the debate.

Congress kicks into high gear on transportation — let’s summarize the action

During an extremely busy week in Congress in several key committees, a long-term transportation bill and a multi-year passenger rail authorization were introduced and passed committees, along with hearings on possible ways to keep our nation’s transportation fund afloat, rural transportation issues, rail safety, and autonomous vehicles.

For those of you who don’t regularly follow Congress, this is often how things go: nothing seems to happen for a long time, and then there’s an explosion of activity all at once. That’s certainly what took place this week in the Senate, with some important ramifications for the future of transportation funding and policy. We hope that Congress shows the same focus when they return from their weeklong July 4th recess.

Four of the five Senate committees with jurisdiction over either transportation policy or funding were active this week. Two notable transportation policy bills (and one yearly spending bill) were advanced out of committees this week, and the Senate made the first big move toward passing a long-term transportation reauthorization ahead of the July 31 expiration of MAP-21, the current law. So what happened, and what should we be expecting next?

Here’s our brief rundown of what you need to know.

First up, in news we haven’t covered here yet, the Senate Appropriations Committee this morning marked up and passed their version of the yearly transportation and housing spending bill that was passed out of the House several weeks ago — a bill that cut TIGER, passenger rail, and transit construction. Unfortunately, the news out of the Senate today was only marginally better. On the plus side, TIGER funding is maintained at this year’s level: $500 million again for competitive grants this upcoming year. But the Senate actually makes deeper cuts to New and Small Starts transit construction than the House did — $520 million in cuts over last year, and $320 million more than the House passed a few weeks ago. Passenger rail funding gets a marginal increase over last year’s level.

While we were hopeful that the Senate could possibly restore some of these cuts made by the House — as had happened in several years past — the consensus by House and Senate Republicans to stick to 2011 budget sequestration-level discretionary funding amounts for all of their FY2016 spending bills result in cuts across the board to discretionary programs like these. All Democrats on the Appropriations Committee opposed this bill.

Smart Growth America offered up this statement on the THUD bill today. T4America is a program of Smart Growth America.

The United States is in the middle of an affordable housing crisis. Rents are rising, the homeownership rate is declining, and federal housing programs are already failing to meet the need for affordable homes. Gutting the HOME program at a time like this is the wrong response. If Congress’s budget caps force this outcome, the budget caps need to be changed.

Logged-in T4America members can read our full THUD summary below:

[member_content]June 24, 2015 — The Senate Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies (Transportation-HUD) marked up and reported its FY2016 appropriation bill to the full committee on June 23 without amendment. This is T4America’s short members-only summary of the THUD bill as reported to the full committee. Read the full memo.[/member_content]

Second up was the release and the subsequent committee markup of the Environment and Public Works (EPW) Committee’s six-year transportation bill known as the DRIVE Act. The EPW Committee is responsible for the largest portion of the full bill known as the “highway title” — more on the other portions below. In case you missed any of our posts about the EPW bill over the last few days, you can catch up with those below. Long story short? EPW released a bill with some modest improvements that represents a good starting point for debate, they approved it unanimously in committee while making a few small improvements, and important amendments that could ensure our investments best maintain and improve our transportation system are still outstanding and will hopefully be considered by the full Senate.

Statement on the release of the Senate’s long-term transportation reauthorization proposal

While this bill provides a positive starting point, there are other areas where Congress can and should do better.

Senate’s new transportation bill is a good start, but more should be done for local communities

The EPW committee marked up and approved this bill unanimously on June 24th without considering amendments (other than a package of amendments in a manager’s mark.) The amendments mentioned below were discussed or offered and withdrawn, and will hopefully be debated on the floor of the Senate. So keep any letters of support coming — this action is still ongoing!

Senate Committee rolls forward with speedy markup of six-year transportation bill

In a committee markup where the phrase “doing the Lord’s work” was invoked by numerous members on both sides of the aisle, the Senate Environment and Public Works Committee sped through a markup of their draft six-year transportation bill in less than an hour this morning, approving it by a unanimous vote with no amendments, save for a manager’s package of amendments agreed to in advance.

While the Senate Appropriations Committee marked up the transportation & housing spending bill this morning, the Senate Commerce Committee — the committee with jurisdiction over rail policy in the Senate — considered the Railroad Reform, Enhancement, and Efficiency Act — a bill to govern all passenger rail policy and authorize funding for the next several years. The RREEA bill is a good step forward, supported by T4America wholeheartedly:

Statement in response to introduction of the Railroad Reform, Enhancement and Efficiency Act

Senators Wicker and Booker are doing the nation a great service in crafting a bill that ensures Americans will see continued and improving passenger rail service in the years to come. Passenger rail service is vital and growing in popularity, and keeping the system working and safe requires investment. The Wicker-Booker bill embraces both those ideas. It authorizes necessary funding to start to return the system to a state of good repair and make targeted investments to improve service.

The committee markup of the bill known as RREEA was mostly uneventful, and it passed by a unanimous vote with mostly minor amendments and issues raised — some of which were safety-related and expected in the wake of the recent derailment in Philadelphia. The Commerce Committee is also responsible for freight and rail policy for the long-term bill, and we’ve heard that they could be releasing their draft long-term bill shortly after the July 4th recess.

Lastly, both House and Senate committees tasked with finding the funding to pay for the next long-term transportation bill (or finding the money to extend MAP-21 past July 31) held hearings this week to continue their work along those lines. In the case of the House, they were specifically discussing repatriation of corporate earnings as a possible revenue source.

Repatriation is the process by which companies can bring offshore earnings back to the U.S. at a reduced tax rate, and then all or a share of those tax revenues would be directed to the trust fund, providing revenues for a long-term transportation bill. It’s an idea that’s gotten some traction in the Senate — Senators Barbara Boxer and Rand Paul have introduced a proposal — but it’s still a one-time fix that’s still not a fee paid by the users of the transportation system.

A House Ways and Means subcommittee held a hearing today to discuss repatriation, and the overall takeaway from the hearing seemed to be that while repatriation may be the most feasible option after a gas tax increase was ruled out by Ways and Means Chairman Paul Ryan, there’s still little consensus in the House, and many representatives want to tie it to more thorny issues like corporate tax reform, reducing the chances that it could pass quickly or easily.

In the Senate, the Finance Committee held a hearing today as well to discuss the use of public-private partnerships — a growing trend in many states as they look to up-front cash from the private sector to help fund longer-term projects where the private party defers their payment or profits. Despite the way P3s, as they’re known, are frequently invoked as a possible funding solution, almost all the panelists today noted that although having a greater range of financing options will certainly be a boost to many states and cities, P3s won’t be sufficient without also increasing overall revenues. They’re not a panacea.

Which leads us right back to the elephant in the room: finding and agreeing upon a new, stable revenue source that can keep the nation’s transportation fund solvent for years to come. It was indeed a busy week, and we hope that Congress will keep up the momentum when they return from their weeklong July 4th recess.

Exclusive Member Summary – 6/18/15 Senate Finance Highway Funding Hearing

June 18, 2015 — US Senate Finance Committee — “Dead End, No Turn Around, Danger Ahead: Challenges to the Future of Highway Funding”

Witnesses:

Dr. Joseph Kile – Assisant Director for Microeconomic Studies Division, Congressional Budget Office

The Honorable Ray LaHood – Senior Policy Advisor, DLA Piper

Mr. Stephen Moore – Distinguished Visiting Fellow, The Heritage Foundation

At this hearing, Chairman Hatch (R-UT) looked to explore every possible option to address the long-term fiscal challenges of the Highway Trust Fund. However, at the hearing he mentioned that he does not see any large-scale gas tax increase as politically possible. That said, Hatch pressed the need remove the “highway cliff” by finding funding to do a multi-year authorization.

Senator Carper (D-DE) called upon Senator Hatch to ensure no options like the gas tax are taken off the table, and referred to T4A analysis that showed state legislators who vote for a gas tax increase were not punished. Carper mentioned that at a minimum we should be able to index the gasoline and diesel tax and then come up with other creative sources to fund infrastructure.

Witness Stephen Moore with Heritage Foundation floated the idea of devolution, but the proposal was very unpopular for a majority of committee members and was shot down by former Secretary Ray LaHood as an irresponsible notion. Senators Thune (R-SD), Heller (R-NV) and Menendez (D-NJ) all voiced devolving the program. Transit came under attack for receiving gas tax dollars, but Senator Thune mentioned kicking transit out of the program is a political non-starter after it failed in the House during debate for MAP-21, and Senator Menendez and former Secretary Ray LaHood both stood up strongly for the need for more robust transit investment, not less.

Senator Thune (R-SD) mentioned that we should be treating general fund transfers as adding debt to an already debt-burdened country, since those funds ultimately do account for part of the deficit. He said it is time we stop the easy solution of general fund transfers and find a way pay for it. Senator Hatch agreed that long-term action is absolutely needed, and mentioned it will be difficult, but that the Committee will be working to look at all the different options to come up with a solution that stops the country from kicking the can down the road.

House takes first step in process to keep the nation’s transportation fund solvent

For the first time since 2012, the House of Representatives held a hearing focused on funding the nation’s transportation system. Today’s hearing focused on the elephant in the room: how to adequately fund a transportation bill that’s longer than just a few months. While it’s a relief to see the funding issue finally getting airtime in the House, keeping the nation’s transportation fund solvent is only half of the problem — we also need to update the broken federal program that isn’t meeting our country’s needs.

Rep. Paul Ryan (R-WI), chairman of the House Ways and Means Committee tasked with finding the money to pay for a transportation bill, took the most obvious funding solution off the table — raising the federal gasoline excise tax — right at the start of the hearing as the gallery was still getting comfortable in their seats, deflating some members of the committee who were eager to at least discuss this option.

“We are not raising gas taxes‚ plain and simple,” he said, while adding later that the House “does need to find a real solution, a permanent solution. We are all ears.” Chairman Ryan suggested that repatriation of overseas profits (a one-time, non-transportation user fee fix) or giving states more authority could be possible solutions, but a gas tax increase is off the table.

Before the hearing, Rep. Earl Blumenauer (D-OR) held a press conference featuring a coalition of groups who support his bill to raise new revenue in the House by phasing in a 15-cent increase in the gas tax. Civil engineers, general contractors, roadbuilders, public transportation operators and T4America director James Corless spoke at the press conference to support Rep. Blumenauer’s case that Congress’ inaction is negatively impacting our nation’s economy and action is long overdue.

James corless blumenauer
T4America director James Corless speaking at this morning’s press conference

Rep. Blumenauer carried his momentum from the morning press conference into the hearing an hour later.

“We’re not keeping up our end of the bargain for the 50 percent of capital spending on big projects that comes from the federal government. We haven’t made any meaningful adjustment since 1993 to the gas tax, relying on short-term fixes, gimmicks – and no matter how you slice it, adding to the deficit,” Rep. Blumenauer said in his prepared remarks.

Rep. Lloyd Doggett (R-TX) concurred. “What is missing from our transportation policy is money – revenue. We cannot build these highways with fairy dust,” Rep. Doggett (R-TX) said.

Rep. Renacci (R-OH), who has put forward a separate plan to index the gas tax to inflation and set up a mechanism to provide long-term transportation funding, noted that “short-term fixes cost money in delay and uncertainty.” He shared a story about meeting with constituents, including some tea party members, on transportation issues. He said that they told him, “‘Quit going to the general fund and taking dollars…what you’re doing is passing it onto our children and grandchildren. What I’d be willing to do is pay a user fee as long as I get my roads and bridges fixed.’ We have to come up with a long-term solution, we can’t continue to go down this path,” he said.

As Rep. Bob Dold (R-IL) from the Chicago area noted on the topic of buying new railcars for the CTA and Metra, “Do we buy them one at a time or ten at a time? I can get a far better deal if I buy them ten at a time,” he said. When agencies can’t reliably put together a multi-year budget because they have no idea what to expect from the federal government, projects can begin to cost more than they should.

Following on the heels of today’s Ways & Means hearing, the Senate Finance Committee is holding a hearing of its own tomorrow on transportation funding.

We can hope that the newfound willingness to discuss the challenging revenue question will lead members of Congress to build consensus around a funding proposal suitable for the nation’s need. However, simply raising new funding to pour into a broken system isn’t going to get us where we need to go either — we need to fix the broken system and update it with the kinds of policies that ensure every dollar invested by taxpayers provides the greatest benefits for the economy and our communities. It’s not enough to simply raise money and spend it on the same processes that created the crisis we find ourselves in today. America can do better, and it’s important that the decisionmakers understand this fact.

On that policy question, eyes are quickly turning to the Senate Environment and Public Works (EPW) Committee, which is responsible for the highway title — the largest portion of the bill. They are planning to release and mark up their successor to MAP-21, a six-year bill, next Wednesday, June 24th.

We are counting on the Senate EPW Committee to release a bill that can maintain our current system, complete the transportation network, incentivize the strategic investments that can provide access to opportunity for all Americans and best improve connections within the cities and towns that drive our economy.

Continuing and improving a nascent process to measure the performance of our transportation investments would allow us to better ensure that our limited resources bring the best return. 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.

We’re now looking to the Senate to make progress on finding a long-term funding solution, but also to make the policy changes we so urgently need to ensure those dollars are well spent.

May 31st transportation funding deadline looming over lawmakers

We’re only three weeks away from the expiration of MAP-21, the transportation law of the land, and Congress still does not have a solid plan for renewing or extending it — or for keeping the nation’s transportation fund solvent past the first days of summer.

Well, we’re here. Seems like just yesterday we were writing the news that Congress had finally passed a new transportation law. But that law, MAP-21, the Moving Ahead for Progress in the 21^st Century Act, was only two years in length instead of the customary six, and it will expire at the end of the month after its first short-term extension concludes. Congress is no closer to agreeing on a multi-year replacement than they were when they kicked the can down the road last summer. To complicate matters, the temporary funding patch that Congress passed in 2014 to keep the Highway Trust Fund solvent will run dry by mid-July, according to USDOT projections.

So far, Congress has not hatched a concrete plan to reauthorize MAP-21 and find a long-term stable funding source, but lawmakers do have some ideas.

In February, Rep. Earl Blumenauer (D-OR) introduced a bill that would nearly double the federal gas tax over the next three years to help fund a long-term transportation bill.

Last month, a bipartisan group of Representatives led by Reps. Renacci (R-OH) and Pascrell (D- NJ) introduced The Bridge to Sustainable Infrastructure Act, which seeks to raise the gas tax by indexing it to inflation by January 2016. The gas tax would then rise every three years unless Congress finds another funding source for the Highway Trust Fund, ultimately guaranteeing 10 years of funding for the transportation program. This bill is the only plan with any bipartisan support that proposes to raise user fees (i.e., the gas tax) in any way. It currently has 20 cosponsors: eight Republicans and 12 Democrats.

Several lawmakers and the Obama Administration have proposed using a one-time repatriation of corporate profits as a source of funding. Barbara Boxer (D-CA) and Rand Paul (R-KY) introduced a bill that would encourage corporations holding profits overseas to return these profits to the US through voluntary “tax holiday” at a decreased tax rate of 6.5 percent. The Obama Administration’s plan would force companies to return their overseas money to the U.S. and pay a 14 percent tax rate on that money. Both repatriation proposals would transfer a portion of the earnings from the tax on returned corporate profits to the transportation trust fund.

Reps. John Delaney (D-MD) and Richard Hanna (R-NY) introduced a bill that would tax overseas profits by 8.75 percent, and would potentially raise $170 billion for the Highway Trust Fund.

What will happen before May 31?

Several lawmakers have sounded the alarm on finding a plan to reauthorize MAP-21 and keep the Highway Trust Fund solvent before the May 31^st deadline passes.

U.S. Transportation Secretary Anthony Foxx called the short-term extensions that several lawmakers have proposed an “outrage,” saying that a long-term plan was necessary so transportation planners could be sure that they’d have the funding needed to move forward with long-term plans.

Senate Minority Leader Harry Reid (D-NV) is rallying fellow Democrats in the Senate to block a Republican-backed trade deal until the Senate deals with funding the Highway Trust Fund (and the Foreign Intelligence Surveillance Act). Senate Majority Leader Mitch McConnell (R-KY), meanwhile, also cited the need to address MAP-21, calling it a “must-do” item that needs to be completed by Memorial Day.

Over in the House, Majority Leader Kevin McCarthy (R-CA) sent a memo to his fellow House Republicans that urged them to act to keep the Highway Trust Fund solvent, which is set to go broke by midsummer. He said that any proposals to increase the gas tax, however, would be dead on arrival this Congress.

Next year’s budget

Whether Congress reauthorizes MAP-21 and extends the Highway Trust Fund will affect funding for next year’s budget for all transportation and housing programs. The House’s Transportation, Housing and Urban Development subcommittee released a transportation budget that proposes heavy cuts to TIGER, New Starts and Amtrak capital funding while holding steady funding levels for highways and other programs. The full House is expected to consider the Committee’s transportation appropriation bill upon return from a weeklong recess. The Senate Appropriations Committee has yet to release their proposed fiscal year 2016 transportation budget. While slow on the uptick, we expect this Congress to be more active on transportation items over the coming summer months. Stay tuned.

House proposes cuts to TIGER and transit construction, stable funding for other programs for fiscal 2016

The House Appropriations Committee introduced a Transportation, Housing and Urban Development (T-HUD) bill for fiscal 2016 that, as in years past, features heavy cuts to TIGER, New Starts and Amtrak.

The bill, approved by the T-HUD subcommittee and headed back to the full Appropriations Committee for markup and a vote, maintains funding rates for federal highway and mass transit formula dollars, $40.3 billion and $8.6 billion respectively. Of course, these funding levels assume that Congress is going to act to find enough money to keep the Highway Trust Fund solvent past this June or July, and also move to either reauthorize or extend MAP-21 after its May 31^stexpiration. Without either action, there won’t be any money for transportation past that deadline, much less for the entire next fiscal year.

Meanwhile, other key programs are facing heavy cuts.

TIGER: The overwhelmingly popular TIGER program would shrink from $500 million to $100 million. In addition, the size of grants would be far smaller, within a range of $2-15 million, down from last year’s range of $10-200 million. This year’s T-HUD also reduces the share that the federal government will cover for TIGER projects, from 60 percent to 50 percent, requiring more local or state money to be brought to the table.

The silver lining in all this is that the House did not repeat last year’s attempt to limit eligibility to only road and port projects, a move that would have left out the wide range of multimodal projects that have benefited the most from this innovative program.

New Starts & Small Starts: These programs that fund new rail, rapid bus and streetcar construction would receive $1.92 billion in funding, down from last year’s $2.12 billion in the final budget. The new bill would also reduce the federal government’s share of New Starts projects from 60 percent to 50 percent.

Amtrak: Amtrak would have a budget of $1.1 billion. The bill actually adds $39 million to the rail service’s operational costs, but cuts $290 million from its capital budget.

The Senate has yet to release its own budget, but for the last few years, the Senate has prioritized funding for many of these important programs. However, with the change in leadership in the Senate in this Congress, it’s unclear if things could play out similarly this year compared to years past.

Members can read our full summary memo on the THUD bill below.

[member_content] Members, you can read our full members-only THUD summary here. (pdf)

And, have you been to the new portal for all members-only content? https://t4america.org/members [/member_content]