Promising new proposals for solving the fiscal shortfall
The report makes the point that American taxpayers “have lost trust in the Trust Fund” as an instrument of maintaining and preserving a nationwide super-highway system. Instead, the Trust Fund has turned into “a kind of all-purpose public works program that now funds sidewalks, bike paths, recreational trails, museums, and streetcars—with ever-larger chunks of the money earmarked for pet projects unlikely to pass any sensible benefit/cost test.”
The report recommends greatly narrowing the focus of the Trust Fund to something that people could see as directly benefitting them, such as relieving urban traffic congestion and improving long-distance freight delivery.
Specifically, the refocused Interstate-oriented program (which the authors have dubbed “Interstate 2.0″) would include adding selected routes to the Interstate map to reflect 21st-century America (vs. 1940s America, on which the system’s map was based), adding capacity to key long-haul routes, some of it in the form of dedicated truck lanes, redesigning and rebuilding the 200-odd interchange bottlenecks across the country, and adding networks of priced express lanes on major urban freeway systems. A tangible results-oriented program, the Reason analysts argue, could rebuild support for federal transportation investment.
The alternative of expanding the focus of the federal program to all modes (mass transit, streetcars, high-speed passenger rail, “livability,” etc) is untenable, the report contends. First, with essentially zero likelihood of a federal fuel tax increase in the foreseeable future (read, before the 2012 presidential election), there is hardly enough money in the Trust Fund to meet even basic highway investment needs. Secondly, all the money in the Trust Fund comes from highway users, from what are still naively, or misleadingly, called “highway user fees.” The report authors recommend restoring the users-pay/users-benefit principle by safeguarding the monies generated by highway users for investment in the highway system.
What about streetcars, bikeways, sidewalks and that rhetorical abstraction of “livable communities”? There is no good reason why these should not be funded out of general revenues, the report argues— assuming there is a reason to support them with federal funds at all. They typically are the kind of social infrastructure that is supported locally by general taxation. What is more, over the past two years Congress has shown ample willingness to put general fund money into transit, high speed rail and “livability” projects. Why not let Congress continue doing so and leave the Highway Trust Fund to its original purpose of funding and preserving highways, the report asks.
The authors estimate that by refocusing the Trust Fund in this manner, an additional $10 billion per year could be freed up for highway investments, to be supplemented by toll financing where appropriate.
The Reason proposal may be expected to meet with opposition and disapproval, even outrage, from advocacy-oriented public interest groups for whom “multi-modalism” has come to mean the right of equal access to the Highway Trust Fund. However, they need to be reminded that the federal gas tax was sold to the public as a means of funding the construction and preservation of the Interstate Highway system. Those who urge restoring the Trust Fund to its original purpose are not necessarily against streetcars, bicycles or “walkable communities.”
They may even see some merit in the “livability” program, amorphous and ambiguous as that concept is. But let those amenities be funded by state and local governments, they say, or by general revenues, as are a host of other social programs that are deemed worthy of federal support. We agree with the authors of the Reason Foundation report that making this change is probably the best hope we have for preserving, improving and expanding the nation’s vitally important highway infrastructure.
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