Highway Fund May Be Empty by August, DOT’s Foxx Warns

This story appears in the Jan. 20 print edition of Transport Topics

WASHINGTON — Transportation Secretary Anthony Foxx, in a plea to Congress to produce a long-term transportation funding plan, said the crises is so severe that the Highway Trust Fund may run out of money by August.

To raise awareness of how dire the situation is becoming, Foxx said he is posting the fund’s shrinking monthly balance online.

“This is a number we share with Congress,” he told the annual meeting of the Transportation Research Board here Jan. 15. “But the American people need to know it too, because they are the ones who use America’s transportation system — and they are the ones who will travel slower and less safely if it isn’t funded.”

Congress, likewise, focused on transportation funding last week when the House Transportation and Infrastructure Committee convened this year’s first hearing on a new transportation reauthorization bill.

Committee Chairman Bill Shuster (R-Pa.) said at the Jan. 14 hearing that he wants to produce a bill by August.

“We hope to take committee action in the late spring or early summer with the goal to be on the House floor before the August recess,” Shuster said. “This way, there will be time to conference our bill with the Senate’s bill.”

Shuster said freight will be a central element in the new reauthorization bill. In anticipation of the bill-making process, he convened a special panel last year to study freight issues.

The current reauthorization funding law expires Sept. 30. Known as MAP-21, it took Congress three years to write. However, it failed to address a funding crisis a decade in the making as Americans began driving less and buying fuel-efficient vehicles that reduce fuel-tax revenue.

To shore up the trust fund, Congress has been transferring billions of dollars annually from the general fund, including $10 billion for fiscal 2014.

Witnesses at the hearing pointed out that MAP-21 was only a two-year funding authorization, which they said prevents long-term planning and creates uncertainty for the economy.

“America needs a multiyear surface-transportation reauthorization so that we can begin to rebuild our infrastructure and get back on the road to competitiveness,” said Stu Levenick, group president for Caterpillar Inc.’s customer and dealer support.

On U.S. highways, he said, “Congestion and capacity constraints are a significant concern with high levels of traffic in major metropolitan areas affecting trucker turn times and on-time performance.”

Bridge capacity is inadequate for large loads, and traffic flows and ports lack supporting infrastructure, Levenick said.

Others at the hearing stressed the need for federal dollars and long-term planning.

“We need the stability of a long-term bill,” said Atlanta Mayor Kasim Reed, speaking for the U.S. Conference of Mayors. Without that stability, local governments can’t make decisions on where to invest their transportation resources, he added.

He also urged Congress to avoid “simply flat lining” existing federal funding levels, which he said would shift the burden to states and cities.

Oklahoma Gov. Mary Fallin said the job of maintaining the nation’s transportation network cannot be left only to the states.

“A continued federal investment is necessary to leverage our improvement efforts and create a cohesive transportation system across the nation.” she said.

Committee members didn’t reveal their preferred methods for funding transportation.

Foxx did not put forth specifics on funding, either. In his speech to TRB, he said President Obama has suggested transportation be funded “with the proceeds from corporate tax reform, and it’s a good idea because it could secure a source of funding for multiple years.”

In a brief meeting with reporters after his speech, the secretary said he’s talking to members of Congress about funding options.

“As I’ve said many times before, this is a dialogue; it’s not a monologue, and we fully expect that there’ll be other ideas out there, and it’s a matter of getting those ideas on the table,” Foxx said.

The secretary was cautious not to endorse the idea, advanced by some lawmakers two years ago and again at the House hearing, that funding for public transit be separated from the reauthorization bill that funds highways.

“It is critically important . . . that there be sustainability, predictability and stability built into our system, and I think that idea could have a destabilizing impact on transit,” Foxx said.

Isolating transit from reauthorization, he said, might take the nation in the opposite direction from where it needs to go — toward a comprehensive transportation plan.

One funding method expected to play a large part in the reauthorization debate is public-private partnerships in which investors build roads and bridges in exchange for toll revenues.

On Jan. 16, Shuster and the committee’s ranking member Nick Rahall (D-W.Va.) created a special panel on “the use of and opportunities for public-private partnerships across all modes of transportation, economic development, public buildings, water, and maritime infrastructure and equipment.”

They said the panel will examine the state of such partnerships and how they “enhance delivery and management of transportation and infrastructure projects beyond the capabilities of government agencies.”