On Oct. 30, 2017, gasoline prices were displayed at a Chevron station near Sacramento, Calif. Rich Pedroncelli, File/AP Photo Drivers used to pay for roads. Washington is destroying that idea.Washington's approach to transportation funding has been governed by one principle for almost a century: People who drive on roads should be paying for them.This tenet has been deteriorating for almost 30 years. It is being strangled by the massive infrastructure packages that Congress and the Biden White House have created.It's simple math. The federal Highway Trust Fund, which is funded by gasoline taxes, is politically indefensible. This has led both presidents and lawmakers to refuse to raise it since 1993. The money needed to finance the nation's growing infrastructure needs, such as roads, bridges, and transit, must come from somewhere. The main solution has been borrowing it and adding it to the federal deficit.Robert Poole, Reason Foundation director of transportation policy, stated that we are seeing other types of pay-fors in order to keep growing the program's size without the actual users paying for it. This is a poor example.This trend alarms both traditional road advocates and businesses that depend on highways for their business. They view the gasoline tax as a user fee, and believe that keeping alive the "user-pays" principle is essential to ensure these large multi-year investments, often multi-year, are not subject to Congress and its appropriations processes, which can sometimes grind to a standstill. It protects money that is dedicated to infrastructure from being diverted to other priorities.The House's surface transportation bill would strengthen the Highway Trust Fund by transferring $148 billion from U.S. Treasury. It is expected to be passed the lower chamber Thursday. This would almost double the $140 billion of deficit-financed general revenues that Congress has poured into the fund since 2008.Similar to the charging motorists and other road users for their use of roads, the idea to charge them is not in the $1 trillion bipartisan infrastructure agreement that Congress and the White House approved last week. It's also not in the multitrillion dollar proposals that Democrats may try to pass by party-line votes. Instead, the White House has proposed alternative funding mechanisms, including revenue from the auction of wireless spectrum. This would likely only bring in a fraction the cash needed with a one-time injection.According to Ed Mortimer (Vice President Transportation and Infrastructure at the U.S. Chamber of Commerce), the user fee is sustainable.Supporters of increasing the gas tax or adding new fees for vehicle owners call it irresponsible.However, some lawmakers are ok with the idea being discarded.Peter DeFazio, the House Transportation Chair (D-Ore.), said Tuesday that he was fine with borrowing money for investments in bridges that will last 100 years. He stated that infrastructure investments make the country more efficient and have a remarkable rate of return.Sen. Brian Schatz (D. Hawaii), who has been advocating for a large, broad infrastructure package agrees.He tweeted that we should deficit finance infrastructure spending. He also referred to the payment in cash for infrastructure as an adult, responsible position that turns public finance and logic upside down.Schatz said that these assets will last for decades and should be paid over many decades.Last big hurrah for the gas taxThe idea of raising the gasoline tax, which was long calculated at 18.4 cents per gallon, wasn't always a popular third rail. In his promise to reduce the federal deficit, Ross Perot, a populist Texas billionaire, included a 50-cent increase in gasoline tax over five years in 1992's presidential campaign.In their deficit reduction plan, Bill Clinton and the Democratic Congress raised the tax by 4.3c per gallon. This fueled a revolt among voters, which led to Republicans taking control of the Capitol in 1994.The idea of raising the tax again was rejected by every president since Barack Obama and Donald Trump. It was also rejected by President Joe Biden, who said he would not support any tax or fee that would affect Americans earning less than $400,000 per year.It is not indexed to inflation so its purchasing power has been eroded for 28 years. According to projections by the Congressional Budget Office, the gas tax could have been indexed in 1993 by Congress.Jim Tymon, the executive director of American Association of State Highway and Transportation Officials, stated that we would be in a much better place right now.Another reason for the erosion of Highway Trust Funds could be called the Prius/Tesla Factor. Fuel-efficient vehicles and trucks now use much less gasoline than they did in the early 90s. Electric cars don't use any gasoline.AASHTO estimates that 43 percent of Americans have lost their purchasing power due to the gas tax's reduction in value since 1993. This is despite the fact that highway construction costs have tripled in the last 28 years. The Highway Trust Fund will have a deficit of $189 billion by 2030.Both parties' leaders don't want to reverse this trend. In fact, as the spending continues to rise and the gas tax is less effective, Congress continues to increase the deficit spending it allocates to maintain it.The White House and 21 senators had been discussing a bipartisan infrastructure plan. This briefly raised concerns about that possibility. A few senators reached a compromise that included indexing the gas taxes to inflation as a way to pay for it. The White House dismissed the proposal immediately.Paid for with smoke and mirrorsInstead, the government and lawmakers have suggested a variety of funding sources for pay-fors that are either impractical, illusory or not ready to be used.Many Republicans support the idea of imposing an annual charge on electric vehicles, which would roughly equal what drivers who drive gasoline-powered cars would pay in fuel taxes.Democrats laugh, noting that electric vehicles and trucks make up less than 2% of all vehicles on the roads. The Congressional Budget Office estimates that such a fee would raise $1.1 billion in five years.As electric vehicle adoption increases, the amount of this fee would rise, but not enough to reduce infrastructure costs. Democrat are interested in providing incentives for electric vehicle use rather than taxing them.The result is that Democrats refuse to accept any new transportation user fees, at least not yet.Advocates of user-pays insist that they are not ready to give up on the idea.Many of us from the transportation stakeholder group aren't ready to abandon the user fee principle, which has funded these programs since the 1950s, AASHTOs Tymon stated.Chambers Mortimer agreed. He said that we built the highway system using user fees.DeFazio admitted that the principle would persist at the moment, at most in the form a weaker gas tax and dwindling purchasing power.DeFazio stated that we must maintain the current system of users paying transportation costs. To get to the numbers, however, we need to add a lot of money.Replacing the Gas Tax?Transportation policy experts have offered ideas to replace the gas tax by making the user pay. A bill that would charge motorists based on how many miles they drive and not how much fuel they use is popular in Congress.This fee, called vehicle-miles traveled (VMT), would be charged to both gas-guzzlers as well as Teslas for the wear and tear they cause on the roads. However, the idea is fraught with logistical and privacy issues that make it difficult to implement widely.The VMT concept is enough to convince some prominent supporters of a higher gas tax increase to give up. The most notable example is Rep. Earl Blumenauer (D-Ore.), a Republican who, after years of tireless advocacy for a higher tax, declared it was time to eliminate the gasoline levy entirely.Blumenauer explained to POLITICO that there are two reasons not go down the path of increasing the tax. There have been arguments about the gas tax, which end up sidelining the entire process. We also have the problem that the gas tax isn't working as much as we thought.Sam Graves, the top Republican on the House Transportation Committees, from Missouri, supports a switch to VMT but wants to preserve the user-pays system.We need to focus on the core of the bill, Graves said last week to Fox Business, talking about the surface transportation bill. To pay for this, we have always relied on user fees.Some policy experts suspect that user-pays will eventually be eliminated, even though the principle is no longer in fashion in Washington.Holland & Knight's infrastructure lobbyist Rich Gold said it was not surprising that lawmakers are pushing for transportation funding without raising taxes or fees. He said that he expected user fees to continue and he would likely add an equitably fashioned VMT later on.Others believe Congress should redefine who is responsible for paying.Pete Rahn is a former transportation secretary for three states and an AASHTO president past president. He suggests that beneficiary pays replaces user pays. This means that all businesses, from coal companies to Amazon, would contribute 8 percent of their commercial activity on U.S. roads and highways.Rahn stated that in modern times, there are many beneficiaries of the national highway system who are not using it but are dependent on it.This report was contributed by Sam Mintz and James Bikales.
