A proposed $8-billion infusion for the Highway Trust Fund has run into trouble in Congress, leaving industry officials hunting for another way to avert a looming projected deficit in the trust fund.
HIGHWAY TRAVEL DOWNSHIFTS
(Vehicle miles traveled, in billions)
MONTH
2007
2008
PERCENTGE CHANGE
(year over year)
April
250.3
245.9
-1.8
March
257.3
246.2
-4.3
February
216.9
215.8
-0.5
January
230.7
226.9
-1.6
2006
2007
December
246.3
236.5
-4
November
245.8
243.7
-0.9
October
258.1
258.7
0.2
September
246.4
244.9
-0.6
August
266.5
270.5
1.5
July
262.8
263.9
0.4
June
263.2
262.5
0.1
May
264.2
266.4
0.8
Source: Federal Highway Administration, "Traffic Volume Trends"
Lawmakers attached the $8-billion highway fund “fix” to a bill extending Federal Aviation Administration programs. But things began to go awry on June 23 in the Senate, when Jim DeMint (R-S.C.) objected to the FAA-highway package, blocking quick approval. In the House, the Ways and Means Committee drafted an FAA extension with the $8 billion for highways. Legislators such as Jerry Lewis (Calif.), the top Republican appropriator, and the Budget Committee’s ranking Republican, Paul Ryan (Wis.), opposed the road-funding provision. Ways and Means deleted it. The House passed the stripped-down FAA bill on June 24, 422-0.
Without an extension, FAA programs, including its construction grants, lapse on June 30. “We didn’t want the Highway Trust Fund language to bring down the FAA reauthorization,” says Jim Berard, spokesman for House Transportation and Infrastructure Committee Democrats, who want a highway- fund remedy. “We have to find another vehicle for this.”
The Treasury Dept. projected in February that the trust fund’s highway account would show a $3.2-billion deficit in fiscal 2009. Industry and state officials say if new revenue isn’t found to close the gap, highway funding would have to be cut in 2009 by $14 billion, or 34%.
Transportation Secretary Mary Peters opposes linking the highway provision to the FAA bill. “I think it is not appropriate to attach something like that to the FAA extension,” she says. “Our aviation programs are too important to complicate with putting competing issues on there.”
A new Highway Trust Fund forecast is expected in July. Brian Deery, senior director of the Associated General Contractors’ highway and transportation division, says, “We’re expecting much worse news than we got back in February.”
One troublesome sign was a June 18 Federal Highway Administration report that travel on roads fell for the sixth consecutive month. FHWA’s monthly “Traffic Volume Trends” says vehicle miles traveled declined 1.8% in April from April 2007 levels. For 2008’s first four months, cumulative VMTs dipped 2.1% from 2007 totals. A falloff in travel may mean fewer gallons of fuel bought and less revenue for the trust fund.
Peters says, since 2005, observers predicted the highway fund would be drained around 2009. “And because of the phenomena that we’re now seeing—people driving less, people using more fuel-efficient vehicles—that day will come and will come sooner rather than later....We need to deal substantively with that.”
