As usual, the Highway Trust Fund remains underfunded and overlooked

In a world filled with uncertainties, there are at least two certainties in the world of freight transportation, supply chain management, and logistics as it relates to federal policy: the federal gasoline tax will never see an increase and national transportation infrastructure that is badly needed will never receive the requisite amounts needed.

Is this based on fact? Did someone really important make an announcement stating this is the deal? No and no are the short answers here. But it sure does seem that way, right? Why wouldn’t it feel that way, though? The gasoline tax has not seen an increase of any type going back to when Clinton was in term 1 in the Oval Office. That’s Bill Clinton, the husband of Democratic Presidential nominee Hillary Clinton.

There have been repeated calls by various high-profile politicians, industry associations and company executives to increase the federal gasoline tax to provide the needed funding to make our the changes our transportation infrastructure truly needs and to also boost the economic competitiveness of the United States, too. But it all continues to fall on deaf ears, or, perhaps, more appropriately, a lack of political will.

Despite all this, efforts are still being made to flip the script on transportation infrastructure funding, specifically the Highway Trust Fund.

Earlier this month, the Transportation Construction Coalition (TCC), a concern made up of associations and unions penned a letter to Rep. Kevin Brady (R-Texas), Chairman of the House Ways & Means Committee, which called for a permanent solution for the Highway Trust Fund’s structural revenue deficit. 

In the letter, the TCC commended Brady for the 130 bipartisan House members urging him to permanently stabilizing the HTF, which they said is a priority for any tax reform refusal, but they lamented how it was not addressed in the plan released by Brady in late June.

“All adjustments to the HTF’s revenue stream in the past thirty years have occurred as part of a broad tax or budget package,” the TCC wrote. “Generating permanent trust fund revenues outside of surface transportation program reauthorization legislation ensures federal tax policy is made in a holistic manner that considers the impacts on both individuals and the overall economy. Furthermore, tax reform and other comprehensive fiscal packages provide lawmakers flexibility to achieve budgetary scoring objectives as they often include both revenue generating and reducing provisions. Previous Ways and Means Committee chairmen recognized that a tax reform package is a logical vehicle for addressing the HTF’s revenue shortfall.”

Last fall, the HTF got a bit of a financial respite, when $70 billion was transferred into it as per the 2015 surface transportation reauthorization, which will then be liquidated in fiscal year 2020.

The TCC said that if the HTF shortfall is not addressed until then, there would then be an almost $18 billion average annual shortfall between existing revenue and the amount that is needed to prevent cuts in highway and public transportation funding.  And it added that should the HTF revenue shortfall not be addressed as part of a comprehensive measure, it would increase the odds of Congress having again to shift funds from another place in the budget, which would come at the expense of other economic sectors to only result in another “long-string” of one-time HTF infusions.

While this at least ensures money is in the HTF, TCC said it is not really enough because states don’t receive the certainty that is required to implement long-term transportation plans, as well as passing this longstanding issue off to a new Congress with a higher associated cost, too.

TCC concluded its letter by explaining to Brady that “[a] permanent, growth-supporting revenue solution for the Highway Trust Fund would achieve many of the economic and fiscal objectives of both parties. We urge you to make addressing the Highway Trust Fund’s revenue shortfall a key priority as your committee continues to move forward with the tax reform process.”

Given the current and expected HTF shortfalls, let’s hope that Rep. Brady and his Congressional colleagues are listening. It is no understatement to say a lot is riding on it.