Fleet Management

No One Wants to Go First on Highway Taxes

May 07, 2014

By Oliver Patton

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The to-and-fro over highway funding continued in the Senate Wednesday with Transportation Secretary Anthony Foxx politely deflecting Sen. John Thune’s attempt to get the Obama administration to say it would accept a fuel tax increase.

The South Dakota Republican, ranking member of the Senate Commerce Committee, said he is skeptical of the administration’s proposal to replenish the Highway Trust Fund with a one-time windfall from a reform in the corporate tax code.

“This aspect of the plan is unlikely to secure broad support in Congress and fails to provide a longer-term funding solution for these vital programs,” Thune said. “It is not a long-term solution.”

Noting that there has been some support in Congress for raising the fuel tax, he asked if the administration open to that idea.

“Our proposal is our proposal,” Foxx replied.

Foxx said the administration is responding to the message that Congress does not want to raise taxes or add to the deficit, and noted that the fuel tax has been on the table for quite a while. “It’s a tool that has been available to Congress over the last several years.”

Thune replied that while the tax has been available it’s hard for Congress to get behind that approach if the administration does not support it.

“Our ears and minds are open to what emerges from Hill,” Foxx replied, adding that he would make no commitment on how the administration would react to an increase, only that it would participate in the discussion.

“You would not rule it out?” Thune said.

Foxx: “We are listening to what Congress says collectively.”

Thune: “That’s what your predecessor (former Transportation Secretary Ray LaHood) said, except that he ruled it out.”

The exchange ended with Sen. Jay Rockefeller, D-W.Va., the chairman of the Commerce Committee, applauding Thune for his effort.

“You tried to pin him down there and he wouldn’t answer,” Rockefeller said. “That’s what’s called the influence of (the Office of Management and Budget).”

And Rockefeller chided Foxx: “You’re better than that Mr. Secretary.”

Thune also wanted to know why DOT is proposing in its bill a 70% increase for transit and a 243% increase for rails but only 21% for highways.

Foxx said that out of the $302 billion in the four-year bill, $199 billion would go to highways, not counting additional funds from competitive grant programs.

The focus on transit and rail is to prepare the national infrastructure for the expected population growth of 100 million and freight growth of 14 billion tons over the next 36 years, he said.

This hearing was nominally about the safety provisions of the administration’s highway bill, but Thune and Rockefeller are members of the Senate Finance Committee, which is responsible for finding the money to keep the Highway Trust Fund from going bust.

The fund will be down to $3 billion by around late August, and already state transportation departments are shelving plans for infrastructure projects because they’re not sure they will get the federal contribution they expected.

The Finance Committee heard on Tuesday that if nothing changes, the trust fund will not be able to meet its 2015 obligations.

Tolling, Hours of Service, Detention Pay

Specific trucking issues did get some coverage at the Commerce Committee’s Wednesday hearing.

Sen. Deb Fischer, R-Neb., wanted Foxx’s assurance that DOT would maintain the hours-of-service exemption for agricultural haulers.

Foxx said the department will continue to make rules exemptions as long as they maintain a proper balance between safety and efficiency.

Fischer also expressed concern about DOT’s proposal in its bill to open up Interstates to tolling.

Foxx replied that the proposal is limited: those tolls could be imposed only at the request of the state’s governor and would have to be approved by DOT, he said.

Tolling can be useful but is not the solution to the highway funding problem, he said.

Sen. Kelly Ayotte, R-N.H., told Foxx she’s hearing a lot of complaints about the hours of service rule, not just from carriers but from shippers and receivers as well.

“I think the rule has substantial problems,” she said, and asked for a cost-benefit analysis.

The Federal Motor Carrier Safety Administration has studied the impact of the rule and is convinced that it is good, Foxx said. He added that he would submit a more detailed answer on the record.

Sen. Roy Blunt, R-Mo., brought up the provision in the administration’s bill that would change the way drivers are paid. The bill would require carriers to pay drivers at least the federal minimum wage for time spent waiting to be loaded or unloaded.

“Did you offer that because new (hours of service) rule had a wage impact on drivers?” Blunt asked.

Foxx said he would submit an answer for the record. It is worth noting that the agency has long contended that uncompensated wait times can be detrimental to safety.

Legislative action on the highway bill will continue Thursday when the Senate Environment and Public Works Committee introduces its proposal to reauthorize the program.

The committee will propose a six-year program that maintains transportation programs at current levels of spending, plus inflation, said Sen. Barbara Boxer, D-Calif.

Comments

  1. 1. Thomas Capizzi [ May 08, 2014 @ 05:54AM ]

    Are we not taxed enough already. How much more tax can this industry absorb.

  2. 2. haller [ May 08, 2014 @ 09:02AM ]

    Cars today and in the near future are averaging between 26 and 42 mpg on the highway, so they consume less fuel which is taxed by the gallon. So a new method of taxing vehicles must be installed. However, make sure all the money is used for the highways and NOT for other projects such as parks, rail, flowers, etc.....

  3. 3. Adam [ May 08, 2014 @ 12:35PM ]

    Thomas,

    The answer is no. Think about your own budget and what would happen if your wages continued to decrease while your costs continued to increase. The highway fund gas tax revenue is in a free fall as vehicle efficiency grows and the cost of building and maintaining roads continues to increase with the cost of inflation.

    You either increase the gas tax or find another source of revenue such as tolling.

    One thing is for certain if we allow our infrastructure to continue down its current path we will no longer be an economically competitive nation.

 

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