What is the future for infrastructure funding?

 

There are major problems with funding transportation infrastructure in the U.S. and it appears the situation will be compounded with the expiration next year of the Moving Ahead for Progress in the 21st Century (MAP-21) surface transportation reauthorization, said Drew Preston, manager of congressional and public affairs for the U.S. Chamber of Commerce

In a presentation before the 2013 Commercial Vehicle Outlook Conference (CVOC) in Dallas, TX, last week, he said there has been difficulty in capturing Congressional attention on infrastructure matters, even as Highway Trust Fund revenues are projected to run out by the beginning of federal Fiscal Year 2015.

The CVOC is a gathering that brings together thought leaders from all segments of the trucking industry to share real-world insights on the state of the industry and discuss what steps can be taken to survive and thrive going forward.

The Highway Trust Fund receives federal gas and diesel fuel tax revenue and then distributes it to states for infrastructure projects.

As it stands, budget forecasts indicate that by the end of fiscal 2014 the Highway Trust Fund will have a cash balance of $4.6 billion. That is problematic because in a given month, the federal government might reimburse states more than $5 billion.

 

Compromise required

Transportation funding is “only the tip of a budgetary iceberg awaiting us this fall,” said Preston. There are also matters of tax reform and other efforts to address the broader “pattern of careening or lurching from one fiscal crisis and corresponding political stalemate to another.

“It’s going to take compromise which is sadly in short supply these days.”

Preston said government needs to consider options for transportation infrastructure funding as the fiscal challenges facing the current fuel-tax-based user-pay model (Highway Trust Fund) increase.

Americans are driving less, vehicles are becoming more fuel efficient and the gas tax hasn't been increased in 20 years. If the trust fund experiences a cash shortfall, the U.S. DOT will be forced to start taking steps to manage whatever cash it has left.

Consequently, funding options such as public private partnerships ought to be considered, he said. The Chamber of Commerce believes there is no path to a 21st-century infrastructure without increasing both public and private investment in infrastructure.

 

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