WASHINGTON — The Highway Trust Fund (HTF) is on its last legs and needs to be propped up with an ongoing influx of funds.
Legislators, stakeholders and others took that message to a Coalition for America’s Gateways & Trade Corridors (CAGTC) 2018 annual meeting here May 16.
Among the funding mechanisms discussed were some form of vehicle mileage tax and levying a tax on electric vehicles as revenues from the traditional federal taxes on gasoline (18.4 cents per gallon) and diesel (24.4 cents per gallon) decline with more fuel-efficient vehicles.
“We need to figure out how to fix the highway trust fund — that’s a big task,” said Rep. Sam Graves, R-Mo., during CAGTC’s event, according to the last journal posting by the American Association of State Highway and Transportation Officials (AASHTO).
“The [federal] fuel tax is very regressive and more and more vehicles pay very little or no fuel tax at all. And this problem is only going to get worse over time. Electric vehicles are also a problem; we need to figure out how to capture a fee from them, maybe through a surcharge, because there are more and more of them on the road. They are a thorn in this process.”
Graves said “a lot of states” are working on what he described as “interesting” alternative HTF revenue projects. Yet those efforts are “boiling down into two schools of thought,” he said: tolling (“which I am not a fan of but which is on the table as an option”) and a vehicle mile tax.
“There is resistance to tracking vehicles for a VMT but the interesting thing is that the kids don’t care about that — they are already tracking themselves with their [personal] technology today,” he said. “We will hopefully start finding answers because the next highway bill is around the corner.”
Sen. Tom Carper, D-Del., believes a VMT is going to be the option that wins out in terms of replacing HTF fuel tax revenue. “Ultimately, I think we’re going to go to a VMT and, ultimately, we’ll need a national VMT pilot program and soon,” he said.
In Carper’s home state, AASHTO noted, the Delaware DOT is the lead agency in a three-month pilot program that started May 1 to explore the potential of a mileage-based user fee or “MBUF” for the I-95 Coalition.
Meanwhile, the HTF needs money and needs it now, Carper said.
“Raising user fees has been successful; about 30 states have raised or added user fees over last few years and 90 percent of the Republicans and Democrats who voted to implement those fees got re-elected,” he said.
Jeff Davis, a senior fellow with Eno Transportation, said the Congressional Budget Office’s latest analysis indicates that the HTF “will be good through spring 2021.”
And Rep. Jeff Denham, R-Calif., said that more “serious discussions” about the HTF need to take place in light of the trust fund’s looming sell-by date.
“Do we index it [to inflation]? Raise it? Add new fees? Add more tolls [to its revenue stream]? Those are debates we need to have because whatever we do we need it to be bipartisan,” he said.
Few in Congress relish such funding debates, added Graves. “I hate that we’re going to have to spend political capital in the short term to stabilize it and then have to return to it and spend more political capital to change it or replace it.”
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