Skip to comments.Diana Furchtgott-Roth: End the highway trust fund
Posted on 01/07/2011 6:17:26 AM PST by Tolerance Sucks Rocks
Imagine if the government taxed you for food, then gave you the money back for groceries and told you what you had to buy, and where you could buy it.
That's what the government is doing to states with transportation spending, and the new 112th Congress should restore sanity by returning fuel taxation and highway spending to the states.
Congress levies taxes of 18 cents for gasoline and 24 cents for diesel, puts the revenue into the Highway Trust Fund, then returns it to the states to spend on transportation.
States in the Northeast, the Pacific Northwest, the Rocky Mountains, the Dakotas and Minnesota get back more than they pay. The Midwest, the South, California, Arizona, and Texas are net donors, with Texas getting the least from the system.
The federal Highway Trust Fund was set up in 1956 so that road users would pay for the interstate highway system. The tax then was 3 cents a gallon.
Congress contemplated that the highway system would be completed in 1972, and the fund terminated. But, as with many other "temporary" programs, it stayed.
The Highway Trust Fund is expected to bring in about $34 billion in 2011. Since it began, the government has collected $674 billion and spent $757 billion -- the difference of $83 billion allocated by Congresses ever tempted to spend more from general revenues.
And, as with everything Congress does, the highway dollars it doles out come with expensive laws and regulations that raise the cost of transportation spending. States want to shop at Costco, but they're forced to go to Whole Foods.
For example, states must have time-consuming environmental permits, agree to certain speed limits, and pay top dollar to construction workers because of prevailing-wage laws set by the Labor Department. Plus, President Obama signed an executive order requiring Project Labor Agreements on large construction projects, so states have to employ costly union labor.
Also, about 20 percent of the fund's dollars are spent on mass transit. That might be beneficial for New Yorkers, but not for Nebraskans and North Dakotans, who subsidize buses and subways for cities in other states.
Some states would rather substitute their own gas tax -- perhaps lower -- for the federal one, and would be able to fund and build the roads they want using a combination of taxes, bond issues, tolls, and public-private partnerships.
Highway tolls could ease traffic congestion by varying prices depending on when traffic is heavy or light. Such toll roads in Southern California, Colorado and Minnesota have eased congestion and raised revenue.
Devolving the Highway Trust Fund to the states could result in a decline in federal spending, with its earmarks and lobbying -- a process the 112th Congress wants to end -- and potential cuts in the Transportation Department payroll.
One alleged disadvantage is the possibility of disparate maintenance from state to state. Montana drivers might arrive at the Wyoming border and find their way slowed because Wyoming has skimped on maintenance.
But that disadvantage already exists today, with some states spending more on maintenance than others.
Of greater consequence, the federal government might end the fuel tax for highways, and then reimpose it later for general revenues, as is the case in Europe. Since the tax raises about $1.7 billion per penny, it might be hard for politicians to resist.
The technology for pricing roads without stopping vehicles is readily available. Charging for roads, and deciding where they should go, should be the responsibility of state or private providers.
It makes no sense for Congress to tax states' gasoline purchases and give them back the money for highway spending. The Highway Trust Fund and the federal fuel tax have outlived their usefulness, and the 112th Congress should wind them down.
The states should stop sending money to DC altogether.
Who writes the check to pay for gasoline taxes (yes, I know the drivers really pay it)? Is it every gas station? The distributors? The refiners?
Do they write a check directly to the federal government or do they pay their own states who then send the federal portion to Washington?
Other than maybe a penny or two to pay for roads necessary for defense but not used much by the locals (Alaska is the only place left like that I can think of), I see no reason why the taxing and paying for roads shouldn't be left entirely to the states. The primary use of federal gas taxes now is to force states to put in rules on blood alcohol limits, speed limits, seat belts, helmets and even capitalization and typeface selection of road signs that the Constitution doesn't allow the federal government to regulate directly.
I did civil engineering work for a rehabilitated railroad depot, being converted into a museum.
It turns out that old railroad depots converted in museums are ‘transportation’ projects; and, the project got some federal TEA money (Transportation Equity Act). Of course this is ridiculous. It got more ridiculous when the state DOT had to review and approve the plans for the building’s parking lot. It was a time consuming and wasteful process - no different than what would be used reviewing plans for an interstate highway.
Any rail depots being rehabed in your town? Federal money.
Round-abouts sprouting up on local streets in your community? Likely Federal money.
Cameras going up at intersections? They were ‘free’, from the feds.
Adding bike lanes in town? You guessed it.
The list is endless. The final insult was my professional engineering exam, for my license. Instead of questions/problems about highways, I was bombarded with problems about bus platforms, bike parking, sidewalk capacity, etc...liberal nirvana had infiltrated an engineering exam.
This will be a wild-assed-guess:
I think that when gasoline sellers send in their forms & payments for state sales taxes, they break down the Federal fuel taxes & the state fuel taxes in the same reports & submit the payments to the states, which then spend more money on administrative costs reviewing the paperwork & sending money on to the Feds.
Then the Feds do more administrative work & return some of the money back to the states.
What a revolving door of paperwork!!!!
Who’s most responsible for using up reams of paper?
Them or me?
My favorites/s are those irritating “traffic calming measures”...those bubbles and loops and ovals of raised sidewalk that cut down the width of a road from 4 total lanes to 2. I’m sure many of those are Fed funded, and I’m equally sure the city board of whatever parcels out these stupid projects to their buddies.
I used to live in Santa Monica, Los Angeles. A great number of these traffic calming bubbles were installed...and then some years later, removed when emegency vehicles had troubles getting around them.