Infrastructure Investment Vital to the Nation

By Dan England

Chairman

C.R. England Inc.

Gridlock in Washington, D.C., is increasingly creating gridlock on our highways. Failure to invest responsibly in infrastructure has led to higher costs for everyone — from trucking companies to consumers.

American Trucking Associations has been a vocal advocate for increasing investment in highways and bridges. We remain steadfast in our support of the fuel tax, which is a mechanism that is not so much a tax as it is a user fee. This fee has enabled the construction of highways and bridges for generations. Had it been properly indexed for inflation, it would still be meeting the nation’s infrastructure funding needs to this day.

ATA’s advocacy of increasing the fuel tax has fallen on deaf ears. Leaders on both ends of Pennsylvania Avenue and both sides of Capitol Hill have repeatedly said, “Everything is on the table . . . except the fuel tax.”

Recognizing political realities, ATA Chairman Philip Byrd Sr. established a highway funding task force that was charged with exploring other funding options. I was honored to serve as chairman of the task force and serve with 10 other ATA members. Over the last several months, we have met in person and by conference call on many occasions.

The task force reviewed about 30 potential revenue sources and prioritized them by both political reality and the amount of revenue that would be generated if Congress adopted our recommendations.

In short, the task force made the following recommendations to the board of directors at ATA’s leadership meeting in Scottsdale, Arizona:

1.  Index the fuel tax, which would raise the level automatically if it was tied to one or more of the following indices:

• The price of fuel. This would function like a sales tax.

• The consumer price index

• The fuel economy of cars and trucks. Using the mandated CAFE standards, increase the fuel taxes in direct relationship with the improving fuel economy requirements. One of the criticisms of the current fuel tax is that it doesn’t account for improving fuel performance. This measure would cure that weakness.

2. Short-term, upfront funding

• These injections of revenue could come from repatriated overseas assets, as proposed by some in Congress and by President Obama.

•  Issuance of Treasury bonds dedicated to infrastructure investment

• Immediate increase in the fuel tax. For the reasons mentioned above, this seems unlikely.

• Continuation of general fund subsidies. This would be an option of last resort.

3.  Highway-access fee. This would be a new, national annual registration or highway-access fee, collected by the states. For every dollar added to registration fees, $225 million would go to the Highway Trust Fund. If the fee were $10 per registration, annual revenues would be about $2.2 billion.

4. Energy-related revenues

•  Royalties from new oil and gas leases on federal lands. This has the potential of raising $800 million annually.

• Tax on crude oil exports

•  Barrel tax on imported petroleum and domestic crude. According to one legislative proposal, this could generate as much as $16 billion over the next decade.

In Scottsdale, the task force recommendations were approved by ATA’s executive committee and board. The timing of the plan couldn’t have been better in that the Obama administration and Congress are working to define their respective proposals to avoid having the Highway Trust Fund run out of money.

It’s our hope that the administration and Congress will give careful consideration to the recommendations adopted by ATA. It’s time for members of both parties to set aside politics and approve legislation that will support a continuation of growth in the U.S. economy.

Inaction or failing to compromise at this critical crossroads in our nation’s history will have devastating effects on the health of our nation. Our elected officials must start acting like statesmen who honor a sacred trust to make decisions that place our nation’s well-being ahead of their personal ambitions.

Dan England, a former chairman of American Trucking Associations, is chairman of refrigerated carrier C.R. England Inc., based in Salt Lake City.