Since 2008, the Highway Trust Fund (HTF) has spent $55 billion more than it takes in. This persistent overspending has caused some politicians to call for an increase in the gas tax. Before even considering increasing the gas tax, politicians should implement reforms to ensure that current gas tax revenue is spent efficiently. With hundreds of thousands of dollars of HTF outlays recently going to projects like squirrel sanctuaries and driving simulators, there is much work to be done.
2015 Projection of the Highway Trust Fund & Transit Accounts
Start-of-year balance: $3 billion
Revenue and interest: $39 billion
Outlays: $53 billion
Cumulative shortfall: -$10 billion
Spend gas tax revenue efficiently
Before the federal government asks drivers to hand over billions more in the form of a federal gas tax increase, elected officials should ensure that current HTF outlays are spent efficiently.
Trust fund revenues should be spent on roads, not bike paths or subways. In 2010, nearly 17 percent of all HTF outlays went to transit programs in six major cities: Chicago, San Francisco, New York, Boston, D.C., and Philadelphia
Repeal the Davis-Bacon union handout: Due to the arcane Davis-Bacon law, federal construction contracts require the government to pay workers 22 percent above market wages.
Other ways to fund the Highway Trust Fund
Dedicate revenue from new oil and gas development to the HTF: In 2011, Speaker Boehner proposed a plan that would authorize expanded oil and gas production, and used the revenue to supplement the gas tax in paying for infrastructure projects. Studies show that full development of America’s OCS could lead to $200 billion in government revenue that could be used to finance the HTF.
Devolve the trust fund to the states: The federal government should not in the business of building roads. States already collect gas taxes and should be responsible for maintain their infrastructure. Senators Rubio (R-Fla.) and Lee (R-Utah) and Rep. Graves (R-Ga.) in the House have introduced the Transportation Empowerment Act that almost entirely returns infrastructure maintenance to the states within five years.