Wednesday, July 29, 2009

Transportation infrastructure: Funding options for next surface transportation authorization presented at House hearing

At a Ways and Means subcommittee hearing last week the top two members of the House Transportation and Infrastructure Committee—Chairman James L. Oberstar (D-Minn.) and Subcommittee Chairman Peter A. DeFazio (R-Ore.) presented their options for the lack of capital in the Highway Trust Fund (HTF), as well as recommendations for their recently-introduced six-year, $500 billion surface transportation authorization bill, the Surface Transportation Authorization Act of 2009.

This hearing came at a time when there are many questions about how to keep the HTF solvent and how to finance the new legislation.

Among the measures presented by Oberstar and DeFazio for funding the next surface transportation authorization were:

* restoring the HTF for emergency relief, vehicle safety research, and foregone interest;

* issuing $60 billion of 10-year Treasury bonds to finance increases in funding provided during the first several years of the bill, which would be repaid in fiscal year 2012 with revenue from the HTF and be retired in 10 years;

* requiring fuel tax exemptions to be reimbursed from the United States General Treasury Fund;

* increase the per barrel fee on crude oil and imported gasoline and diesel;

* instituting a transaction tax on speculative trading of crude oil futures;

* the implementation of other user fees like an increase in the Heavy Vehicle Use Tax, vehicle registration fees, and container fees, which would finance freight related infrastructure improvements (this would be comprised of a $10 fee on every TEU (twenty-foot equivalent unit) container moving through a U.S. port and raise $3 billion over six years;

* a freight waybill tax that would act as a sales tax on freight shipping costs, with a 0.1 percent tax on truck freight waybills that would raise $620 million per year and a similar tax on waybills for all transportation modes that would raise $740 million annually; and

* a transition from a gas and diesel tax to a vehicle miles traveled (VMT) fee system that charges users for each mile driven.

“There are many options for financing the Surface Transportation Authorization Act of 2009,” said Oberstar. “None will be popular. However, without new revenues, our highway, highway safety, and public transit programs face enormous cuts at a time when the nation’s surface transportation network requires a substantial increase in investment just to maintain current standards. By making this investment, we will transform the future of surface transportation in the United States.”

Read the rest of logisticsmgmt.com article here.