HuffPo features story on trucking industry and gas taxes

A story in the Huffington Post includes the headline “Trucking Industry Pleads With Congress to Raise Gas Taxes.” The story is in response to the ongoing attempts to find a solution for the perpetually-underfunded federal highway fund and preventing it from going broke at the end of July, as the American Trucking Associations said to members of Congress.

“Congress must find the courage to admit what I believe it already knows,”  said Bill Graves, a Republican who is the former governor of Kansas, in testimony he delivered to the House Ways and Means Committee. Graves told congress people at the hearing that in order to repair the ailing highway fund, they will need to raise the tax, whether they want to or not.

Graves also noted that his industry paid more than $16 billion in fuel taxes in 2013, yet still believes paying more tax is the best option. Graves went on to add that he raised the Kansas gas tax during his time as governor by explicitly laying out to residents why it had to be done. “It was, I confess, a little easier than I thought it would be,” he said.

The genesis of the problem, as Graves sees it, is that the federal tax of 18.4 cents per gallon (and 24.4 cents per gallon for diesel) hasn’t been raised since 1993, and has failed to keep up with inflation, leaving Congress to find other methods to keep the fund solvent by throwing short-term cash at it.

This funding method has led to delays in construction projects and higher costs. Infrastructure experts believe that not enough funds are being spend on transportation costs.

Graves, along with other witnesses who spoke, outlined many other ways to fund roads and bridges, including tolls, taxes on miles driven, oil taxes, public-private partnerships, or simply funding highways out of the general revenue fund. However, Graves called all of those options flawed: tolls are uneven and inefficient, it is impractical to accurately tax mileage on hundreds of millions of vehicles; oil taxes have many downsides, partnerships have been hit or miss, and dropping the gas tax in favor of annual appropriations creates even more uncertainty than we already have, he said.

Graves noted that the message of this hearing was so familiar because many of the same ideas had been proposed at the last raising of the fuel tax, and lawmakers said at that time that the country needed to find better ways to fund transportation projects. Congress has passed 34 measures deemed “stopgap” to keep the fund afloat while failing to find the new way to pay for construction.

“Today’s conversation has been taking place for 22 years and I believe it’s time for Congress to acknowledge in the near term that the fuel tax continues to be the lesser of all the infrastructure funding evils. I believe it’s the only funding option that makes sense,” Graves said.

“Roads and bridges aren’t free, and they’re certainly not cheap, yet Congress has been operating under the assumption that pennies might fall down from heaven.”

Wisconsin Democrat Paul Ryan, chairman of the House Ways and Means Committee, flatly rejected the idea, saying “we’re not going to raise the gas tax.”

However, Graves persisted.

“The whole business community has conveyed the message that they would support a fuel tax increase,” Graves said just after the hearing ended. “Many members of Congress have said, thank you, but we’re not interested in that approach, we’re going to try other, as I said, outside-the-box thinking, creating financing options. It feels like we’re getting close to the point where they’re starting to realize that those just don’t exist as many of them hoped they would.”

If Congress chooses to continue the stopgap approach, it would be necessary to find another $3 billion this year, according to Chad Shirley of the Congressional Budget Office. Next year, that would rise to $11 billion, and $22 billion by 2025.

To learn more about this topic, or to read the entire article, visit the Huffington Post’s coverage of the ongoing battle to bankroll the federal highway fund.