In a study released by the American Transportation Research Institute on Friday, ATRI proposes new transportation funding options and identifies losses exceeding $900 million annually in critical transportation funding resulting
from state and federal fuel tax exemptions.
The loss from fuel tax exemptions is just one of several implications for highway funding explored in ATRI's Defining the Legacy for Users: Understanding Strategies and Implications for Highway Funding.
In response to numerous state and federal efforts to pursue tolling and highway infrastructure privatization as the answer to the nation's transportation funding shortfalls, ATRI's research is among the first to examine highway funding from a system user perspective. While collection costs for fuel taxes range from 3 percent to less than 1 percent of revenue, ATRI has documented toll collection revenue-to-cost ratios exceeding 21 percent.
"Every state legislator needs to understand that tolling is not an efficient way to improve transportation," said George Billows, executive director of the Illinois Trucking Association.
The study also highlights the threat to rural America resulting from the push toward tolling and privatization. Rural corridors lack the necessary population densities and financial base to attract private sector investors focused on profit. Yet these same corridors are critical links in the U.S. supply chain, providing essential commodities and connectivity between states and metropolitan areas. The research proposes that the U.S. DOT's mission of providing a seamless transportation network requires holistic funding strategies that ensure continued support of rural corridors rather than focusing solely on high traffic metropolitan routes.
"Pursuing funding strategies that knowingly fragment our national transportation system is simply bad business. Our products have their genesis in this country's heartland, and we rely on those same connectors to deliver goods to American consumers," said Jack Shawn, senior operations manager for TFE Logistics.
As the most efficient and equitable method for raising revenue, the motor fuel tax is recommended as the most effective strategy for increasing transportation funding for the short- to mid- term. To meet the increasing needs, ATRI's research recommends increasing the fuel tax in conjunction with elimination of numerous costly fuel tax exemptions and diversions from the highway trust fund. In total, the study identifies an additional $10 billion to $38 billion that could be raised in annual revenues for highway infrastructure.
Pat Quinn, co-chairman of U.S. Express Enterprises said, "ATRI's study identifies many cogent issues that require public dialogue as we chart the future of surface transportation. I look forward to sharing the findings with my fellow commissioners." Quinn serves as a member of the National Surface Transportation Policy and Revenue Study Commission.
A copy of the study's Executive Summary is available online at www. atri-online.org/research/results/economicanalysis/index.htm, where a copy of the full report can also be requested.
ATRI is the trucking industry's not-for-profit research organization. It is engaged in critical research relating to freight transportation's essential role in maintaining a safe, secure and efficient transportation system.