The gas tax is likely safe for now. And that’s the problem.
By Brad Plumer,
Despite recent rumors to the contrary, Congress is likely to extend the gas tax this fall. And that could end up being precisely the problem.
This week, Politico’s Ben Smith and Byron Tau raised the possibility that Republicans could try to thwart an extension of the federal gas tax when it (largely) expires Sept. 30. “The White House is going to make a move to renew it,” former RNC spokesman Doug Heye told Politico. “We’ll see — but there will be Republicans who will be resistant to that.” Grover Norquist even made some grumbling noises.
At least for now, however, most transportation-funding advocates are sanguine that Congress will renew it. “Anything’s possible, but even as crazy as things have gotten, I have a hard time seeing them let the gas tax lapse,” says David Goldberg of Transportation for America. After all, the tax, currently 18.4 cents per gallon, provides an enormous pot of money for transit and highways. And highways are popular — the 2005 transportation bill passed with overwhelming bipartisan support. (On the other hand, that bill was heavily greased with pork — remember the Bridge to Nowhere? — and Congress’s new earmark ban could make it tougher for appropriators to buy off support for a highway bill.)
The more pressing worry, transportation wonks say, is what happens if the gas tax does get renewed. The 18.4-cents-per-gallon tax is already inadequate to fund current infrastructure obligations, not least because, in recent years, Americans have been driving less and buying more fuel-efficient cars. The good news is that we’re using less gasoline. The bad news is what that does to highway funding. In 2008, Congress had to kick in $8 billion to keep the Highway Trust Fund solvent. And the trust fund’s finances will continue to deteriorate in the years to come, according to the CBO:
By 2018, the trust fund is projected to be short $80 billion. That’s the context for the coming showdown on transportation funding this fall. In the House, Rep. John Mica has put forward a transportation reauthorization bill costing $230 billion over six years — essentially a 33 percent cut from current levels. State officials are already complaining that that won’t even come close to meeting America’s infrastructure needs. (One example of our crumbling roads, courtesy of Transportation for America: The average bridge in America is about 42 years old. The average bridge’s lifetime? 50 years.) That’s because House Republicans want transportation funded solely from the ever-dwindling gas tax.
In the Senate, meanwhile, Barbara Boxer has proposed keeping funding at current levels for two years, until the recession subsides and Congress can get a clearer picture of its finances. But that sets the stage for a showdown with the House, and it’s still unclear how the two chambers can possibly reconcile.
Even some Republicans — Mica, in particular — admit that the funding situation has become untenable. But no one seems to know what to do about it. One obvious possibility would simply be to raise the gas tax. Ronald Reagan did that in 1982. George H.W. Bush did it in 1990. Bill Clinton did it in 1993. But then Congress balked at raising the tax during the George W. Bush years and it’s been stuck at 1993 levels ever since. Right now, fees on drivers and transit users cover just 66 percent of all transportation expenses.
Alternatively, Congress could find a different funding stream for transportation. One idea is a vehicle-miles traveled tax, which would track driver habits via GPS and charge per mile driven. (The White House floated this notion earlier this year and then retracted almost immediately.) Another is to charge some sort of congestion fee on overclogged highways — an idea that Tyler Duvall, a former Bush administration official, endorsed in National Affairs. Mica, for his part, has suggested extending the Build America Bonds program that was part of the stimulus. A bipartisan team affiliated with the Carnegie Endowment has proposed an upstream tax on oil combined with a variable gas tax that shrinks when oil prices rise and expands when oil prices plummet. But few of these ideas have gained traction in Congress. Which means fights over transportation are only going to intensify.