June 23, 2014
On Friday, Transportation Secretary Anthony Foxx reminded state departments of transportation that the Highway Trust Fund’s “situation remains dire.”
He noted in a letter to state DOT directors that the HTF is projected to run out of money at the end of August — one month before the current highway bill, MAP-21, expires — and the U.S. DOT would “likely need to delay some reimbursements” to each state. This is the second warning letter Foxx has sent to state DOTs. (To read the full letter, click here.)
As the deadline to find a solution to fund transportation projects nears, lawmakers are talking more and more about ways to bring in revenue.
Among latest ideas to surface was a proposal to raise the gas tax by 12 cents per gallon over the next two years. The plan would increase the gas tax by 6 cents per gallon each year for two years, indexing the tax to inflation.
The plan gained support from several industry professionals, but Rep. Kevin McCarthy (R-Calif.) told Fox News on Sunday that lawmakers need to “find a broader solution” than raising the gas tax. Watch the video for more of his interview about the HTF.
In a more supportive interview, Rep. Earl Blumenauer (D-Ore.) told Politico that he is interested in a gas tax increase but noted that executing the idea of a fuel tax hike still needs some work.
“[The bill is] a bit of a stretch that you’re somehow going to claim budget credit for hundreds of billions of dollars of tax extenders, but that’s something they’re going to have to hash out,” Blumenauer said in the report.
However, the two-year plan for a gas tax raise, as well as any other options to fund transportation for more than a few months, may not even pass in the House.
Despite Foxx’s warning and efforts to find revenue, House Speaker John Boehner (R-Ohio) said last week that a long-term highway bill is not likely, according to The Hill.
“I think the idea is to try to find a package that would plug this hole for nine to 12 months to make sure that the highway projects that are underway will continue,” Boehner said.
He added that the House is looking for ways to patch the HTF.
“I know that the Ways and Means Committee is…having discussions about a package of pay-fors that would fill the gap for some number of months,” he said.