On Wednesday, September 11, the House Transportation & Infrastructure Committee’s Subcommittee on Highways and Transit held a hearing to examine funding options for nationwide infrastructure improvements. The hearing, titled “Pricing and Technology Strategies to Address Congestion on and Financing of America’s Roads,” included testimony from six witnesses from various groups within the transportation sector, one of which was YRC Worldwide Inc. President and CEO Darren Hawkins. The witnesses and subcommittee leadership each highlighted their preferred method for infrastructure funding, but Hawkins zeroed in on the federal fuel tax as the best solution to address the present shortfalls to the Highway Trust Fund.
The federal fuel tax has not been increased since 1993 and has not kept pace with inflation, with rates set at 18.4 cents per gallon for gasoline and 24.4 cents per gallon for diesel fuel. TCA and the broader trucking industry fully support increasing the federal fuel tax and indexing it to inflation, with the Consumer Price Index being the preferred standard for measuring inflation on an annual basis. This will ensure that the Highway Trust Fund maintains a healthy flow of revenue, which is critical for funding many key infrastructure projects important to interstate commerce. Unfortunately, in recent years, the Highway Trust Fund has experienced funding shortfalls and has required transfers from the U.S. Treasury’s general fund to stay afloat and pay for the projects currently underway.
These transfusions of cash into the Highway Trust Fund have helped to maintain the status quo of infrastructure investment. But our country’s infrastructure is falling woefully behind our international competitors and has received a D+ grade on the Infrastructure Report Card produced by the American Society of Civil Engineers. This means our nation’s leaders must take drastic measures now to invest for tomorrow and update our lagging infrastructure system.
We believe the only viable option for doing this immediately is through raising the federal fuel tax. Not only will the fuel tax provide the necessary revenue, but it presents the only potential funding solution with an almost 100% return on investment.
Yet many members of Congress and some of the witnesses at the hearing believe other options, such as transitioning to a system of congestion pricing or a vehicle miles traveled (VMT) tax, present a more palatable alternative to the federal fuel tax. Unfortunately, the trucking industry and the general motoring public cannot afford to wait for these types of taxation schemes to be implemented at the national level to see improved infrastructure investment. We also do not believe they should be put into place before a federal fuel tax is fully phased out due to the threat of dual-taxation.
TCA encourages our federal representatives to step up to the plate and take the hard but necessary vote in favor of increasing the federal fuel tax before it is too late. The viability of our nation’s infrastructure, the U.S. economy, and Americans’ lives are all at stake if inaction persists on this vital issue.