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Gas tax increase is debated after White House turns to Congress for infrastructure help

Senate Minority Leader Charles E. Schumer (N.Y.) held a news conference Wednesday with fellow Democrats to discuss their infrastructure plan.
Senate Minority Leader Charles E. Schumer (N.Y.) held a news conference Wednesday with fellow Democrats to discuss their infrastructure plan. (Alex Wong/Getty Images)

A day after the White House invited Congress to come up with the money to fund its infrastructure proposal, lawmakers knuckled down to the task, and the most likely candidate emerged: hiking the federal tax on gas and diesel fuel.

“The issue is funding it, putting real money on the table,” Chris Spear, president of the American Trucking Association testified before a House subcommittee on highways and transit Wednesday. “It’s imperative that this president put the full power of his office behind this. If he wants it done this year, he’s going to have to lead it, not just throw everything on the table.”

Spear said the truckers support a 20-cent tax on fuel at the wholesale level.

In testimony before the full transportation committee Tuesday, Transportation Secretary Elaine Chao said she was eager to work with Congress on finding a funding mechanism and that the Trump “administration is open to considering all revenue sources.”

“We need the president to lean in,” Rep. Elizabeth Esty (D-Conn.) said. “It’s not enough to say it’s all on the table. It’s all been on the table for decades.”

D.C. Del. Eleanor Holmes Norton (D) echoed, “The prospect of raising the gas tax has paralyzed the Congress for a quarter of a century.”

White House turns to Congress for ideas on infrastructure funding

There was bipartisan support at Wednesday’s hearing for increasing the fuel tax of 18.4 cents on gasoline and 24.4 cents on diesel fuel, which was last raised in 1993. The tax is a user fee, and a decade from now, it’s expected that vehicles will pay a different form of user fee — based on vehicle miles traveled — as hybrid and electric cars continue to erode the gas tax.

“Since [1993], its purchasing power has lost 4o percent,” said Ed Mortimer, executive director of transportation and infrastructure for the U.S. Chamber of Commerce. “It’s not that the user fee isn’t sustainable, it’s that we haven’t adjusted it” for inflation.

The chamber has endorsed a 25-cent increase in the gas tax.

Given what is perceived as an immediate need for infrastructure investment, bumping up the tax on fuel seemed to committee members the best option.

“The easiest one for us to understand — not that it’s easy to pass — is what we pay at the pump,” said Rep. Bill Shuster (R-Pa.), who is chairman of the Transportation Committee.

Thirty-one states have increased their transportation funding, 24 of them by raising state gas taxes, the rest by increasing the tax and other fees.

“No one has lost their election,” said Rep. Peter A. DeFazio (D-Ore.), lamenting the “gutless wonders I work with.”

“If you don’t increase taxes, we’re not going to have an infrastructure bill, and we’re doing nothing, and we’re just sitting here jawing,” DeFazio said.

The Trump administration has proposed raising $1.5 trillion over 10 years. The White House wants the federal government to contribute $200 billion, with the rest of the $1.3 trillion coming from private investors, states, counties and municipalities.

White House says it’s considering increasing the federal gas tax for infrastructure

The future of the 25-cent gas tax increase suggested by President Trump lies not in the House Transportation Committee or its subcommittees, but down the hall in the House Ways and Means Committee, which controls the purse strings.

Getting action there will require the backing of House Speaker Paul D. Ryan (R-Wis.). Ryan’s office on Wednesday responded to an inquiry by providing a 2015 article in which Ryan said he was “against raising the gas tax.”

“The speaker is ideologically opposed to federal investment and to increasing taxes in any form, no matter how much it benefits the nation,” DeFazio said. “There hasn’t even been a single hearing in Ways and Means on revenue for the [federal Highway] Trust Fund or infrastructure.”

In her testimony Tuesday, Chao also said the administration planned to phase out a program popular with many on Capitol Hill after this cycle’s $500 million in grants are awarded. The TIGER grant program, which spread money to 31 states in 2016, would morph into the Infrastructure for Rebuilding America grant program.

“The INFRA program will make approximately $1.5 billion available to projects that are in line with the Administration’s principles to help rebuild America’s crumbling infrastructure,” the Department of Transportation said in a statement on its website. “In addition to providing direct federal funding, the INFRA program aims to increase the total investment by state, local, and private partners.”