Because of an editing error, an article on yesterday's Federal Page said that all fuel tax money goes to the highway trust fund. Under legislation recently passed, 2 1/2 cents per gallon goes to the Treasury's general revenue. (Published 11/1/90)
The great lobbying battle between the railroads and the truckers over which industry should pay what fuel taxes has been fought to a draw for now.
The budget bill Congress passed last weekend raises fuel taxes on both modes of transportation, but not nearly to the extent either had feared.
Truckers will pay an extra 5 cents per gallon on diesel fuel, raising their federal fuel taxes to 20 cents per gallon. But that is far less than the extra 12 cents congressional and administration negotiators recommended in the budget summit agreement that Congress rejected.
Railroads will pay a 2 1/2-cents-per-gallon tax on diesel fuel, will pay more into the Railroad Retirement System and will be charged for the first time for federal railroad safety inspection. But that is far less than the 9-cents-per-gallon trucking supporters on the House Ways and Means Committee inserted in the original reconciliation bill.
Revenue from the fuel taxes is deposited in a federal trust fund to build and improve highways.
Both groups had run major lobbying campaigns, with the truckers operating a nationwide, 100-person phone bank for more than two weeks aimed at persuading individual truckers to call their lawmakers.
Spokesmen for the two combatants -- the American Trucking Association and the Association of American Railroads -- expressed muted satisfaction that they were not hit with even greater taxes and fees.
"We feel this is a fair shake for us," said Thomas Donohue, president of the trucking association. Truckers were "much more reasonably treated than the 12 cents," he said.
Donohue said the extra taxes will cost truckers $1.2 billion a year, about a quarter of the industry's 1989 profit of $4.4 billion. Truckers expect to cover much of the extra cost by raising charges to customers.
Richard E. Briggs, executive vice president of the railroad association, was a little more somber.
"This is a big hit," Briggs said, especially since the extra costs will hit at a "time of declining demand" in the economy that will make it more difficult to pass the costs through to customers.
Briggs said the tax will cost $400 million over five years. On top of that will come other costs increases including $170 million over five years for safety inspections by the Federal Railroad Administration now paid for with public money.
Railroads have not paid fuel taxes before on the theory that they own their tracks and should not contribute to the highway trust fund, which finances road construction that benefits their trucking competitors.
Because only half of the extra 5-cent diesel tax will go to the trust fund -- the rest will go to the general treasury -- railroads were required to pay the half that goes to general revenue.
This year's battle was only a warm-up for next year, when Congress must consider new highway legislation. Railroads already are waging a nationwide publicity campaign against an expected move to allow longer, heavier trucks on major highways nationwide.
Donohue said the extra tax bite this year will put the truckers in better shape to justify allowing heavier trucks on more highways.
"We can say, hey, fellows, we gave at the office," Donohue said.
Briggs disagreed. "I don't think it makes a material difference," he said.