Reaction by highway stakeholder groups to President Trump’s State of the Union remarks on investing in infrastructure seem to be informed as much by earlier information on his spending proposal as by anything he said in his Jan. 30 address to Congress.
In his SOTU speech, the president called for Congress to pass a bipartisan bill that “generates" at least $1.5 trillion to invest in infrastructure improvements — but he made no mention of how to pay for that princely sum.
But based on what the Trump Administration has previously stated, as well as a recently leaked draft document, the president’s approach to financing infrastructure improvements remains fixed on priming the pump with $200 billion in cash and tax credits to stoke spending on infrastructure projects by state and local governments as well as by private investors.
It should be noted that the leaked draft document contained one specific point that did not go over at all with several stakeholder groups: that states be allowed “flexibility to toll on interstates and reinvest toll revenues in infrastructure” and to “reconcile the grandfathered restrictions on use of highway toll revenues with current law.”
Tolls a No-go for Many
Albeit to different degrees, the American Trucking Associations, the Alliance for Toll-Free Interstates and NATSO, which represents truck-stop operators, all declared their opposition to reversing the current federal ban on tolling existing interstates and to expanding tolling in general.
At least one lobbying group, though, said it is “encouraged by the president’s call to cut burdensome regulations and laws that prevent states from accessing all available funding options to meet their local needs.” Patrick Jones, executive director and CEO of the International Bridge, Tunnel and Turnpike Association, said in a statement on the SOTU address that the current federal restriction on tolling interstates is "one such barrier to increased higwhay investment. Some of the highest-capacity, Interstate-quality highways in America would never have been built without tolling."
By contrast, both ATA and the powerhouse U.S. Chamber of Commerce have lobbied not only against expanding toiling, but also strongly in favor of raising the federal fuel tax – and indexing it for inflation going forward — to pay for work on highways and bridges. The chamber plan proposes a 5-cent increase over five years. “Increasing the fee by a total of 25 cents, indexed for inflation and improving fuel economy, would raise $394 billion over the next 10 years,” according to the lobby’s president and CEO, Tom Donohue (a former head of ATA).
In a statement on Trump’s address, ATA President and CEO Chris Spear called for Congress to produce with the administration “an infrastructure package that raises real revenue to meet the enormity of this challenge. Roads are not a partisan issue – they’re driven on by Republicans and Democrats alike. As both sides of Capitol Hill know, modernizing our infrastructure will require a substantial investment – actual, real revenue. America cannot be rebuilt with funding gimmicks and finance schemes.”
Spear added that ATA is “looking forward to working with Congress and the administration and educating the public on why a fuel user fee is the most cost-effective and conservative answer to fixing our deteriorating roads and bridges.” He noted that the trucking lobby has put forward its own proposal, the Build America Fund, which he called “efficient, conservative and viable, and will generate $340 billion of real money in the first 10 years.”
Fuel Tax Seen as More Popular than Tolls
The Owner-Operator Independent Drivers Association said it welcomed Trump’s call for $1.5 trillion in infrastructure investment, but said that on the other hand, “professional truckers are concerned by the administration’s reliance on private investment to achieve this level of funding.”
OOIDA stated that the issue of federal funding of highways has been affected by “negative attitudes toward raising taxes.”
The association said that it regards fuel taxes, both diesel and gasoline, as the most efficient way to raise funds, as opposed to looking to private-public partnerships, the sale or lease of existing roads, or efforts to convert roads into tolled roads.
“If elected officials think a fuel tax increase would be unpopular, wait until Americans encounter more and higher tolling,” said OOIDA Acting President Todd Spencer. “An investment of $1.5 trillion in infrastructure will help dramatically improve our roads, while spurring economic growth. But increased tolling is not the way to pay for it.
“Instead,” he added, “the White House and Congress should find the courage to increase federal fuel taxes, which are a significantly more reliable and efficient source of revenue than tolling.”
Bud Wright, executive director of the American Association of State Highway and Transportation Officials, said the group was pleased Trump had highlighted the need for additional federal investment in infrastructure. "AASHTO has, for years, called for a long-term strategy to shore up the Highway Trust Fund in order to maintain federal investment in surface transportation. We are looking forward to seeing the president’s infrastructure plan and working closely with the administration and Congress to advance a robust, long-term infrastructure bill that supports needed reforms, such as streamlining project delivery in ways that also protect our natural resources.”
A Call for Putting Focus on Freight
Other reaction to the speech included the contention of the Coalition for America’s Gateways and Trade Corridors that the Trump administration and Congress should increase direct federal investment with an emphasis on multimodal freight infrastructure. “For years, federal freight infrastructure investment has lagged while our population and national economy grow," said CAGTC President Leslie Blakey. "This financial burden cannot be shouldered by states, localities and the private sector alone, and we welcome President Trump’s commitment to driving an investment plan at the federal level.
“Existing programs are oversubscribed," Blakey added. "The freight-focused INFRA program, for example, saw $13 of requests for every $1 available in its first round. We encourage the administration to commit significant resources above current funding levels and dedicate a minimum of $2 billion annually to freight projects.”