Truckers prepared to pay more in taxes for greater productivity

John D. Schulz, Contributing Editor -- Logistics Management, 4/14/2008

WASHINGTON—At a time of record diesel prices, truckers are willing to pay even more in federal fuel taxes if more highway capacity can be created for the industry.

Bill Graves, president and CEO of the American Trucking Associations, said at the National Industrial Transportation League’s (NITL) Spring Policy Forum earlier this month that if all sectors “give a little, we can get a lot” from the upcoming debate over infrastructure funding.

To show the truckers’ commitment to improving this country’s infrastructure, Graves says ATA is willing to support higher fuel taxes in exchange for certain improvements in major freight corridors that trucks ply every day.

“We believe there needs to be more investment in infrastructure across the board—in all modes,” Graves said. “All modes need to be invested in as we go forward.”

Still, an increase in the fuel tax may be a non-starter in Washington. Graves privately told of a meeting with a Democratic member of Congress who he thought might be receptive to an increase in the fuel tax.

“Are you kidding me?” Graves recalled this member of Congress saying. He did not identify the member of Congress, but indicated that a rise in the fuel tax might be a non-starter.

Graves sounded optimistic that some compromise might be available to allow truckers to run longer combination vehicles (LCV) in more areas in exchange for some higher fees. Currently, use of LCV’s has been frozen since 1991 to mostly Western highways and a few limited-access Eastern roads.  

Graves called on members of the National Industrial Transportation League to take an active role in helping shape the upcoming national debate on infrastructure.

“Congress needs to know we are in a crisis,” Graves said. “Congress needs to hear from members in the states that bold action is needed—and expected.”

Graves is calling on improvements in certain freight corridors through either more highway lanes, included thousands of miles of truck-only lanes, or lessening of freight bottlenecks around the country. In exchange for this, ATA is prepared to pay more in fuel taxes “in order to get a world-class infrastructure built,” Graves said. The ATA is opposing, however, any further use of tolls on existing highways.

Clearly, all types of funding will be needed. The rough figure being floated around

Washington is the next highway bill will cost a record $500 billion over six years, compared with the last six-year bill which cost $286.5 billion.

“It feels to me like we need to have a coalition of the coalitions,” Graves said. “Everybody is going to have to come to the table prepared to give a little to get a lot.”

Ed Hamberger, president and CEO of the Association of American Railroads, said $148 billion is needed in rail capacity expansion funding to handle freight levels forecast by 2035. He is encouraged that the public finally is waking up to the needs of transport.

 
“For the first time in 30 years, transportation is finally making it into the national dialogue,” Hamberger said, noting the U.S. Chamber of Commerce, National Association of Manufacturers and other groups are all advocating greater investment in transport funding.

Hamberger emphasized AAR’s opposition to re-regulation of the railroads, nearly all of which are posting record or near-record profits. Hamberger said those profits are necessary in order to provide “the means and the incentive” to create further rail capacity.

Chris Koch, president of the World Shipping Council, which represents the international ocean liner shipping industry, said his business is “a complicated business getting more complicated.”

The privately owned transportation infrastructure in this country is adequate, Koch said. But the publicly owned infrastructure is badly in need of an overhaul, he added.

“What the shipper and carriers need to do is come up with a common vision so we don’t look like warring tribes,” Koch said.