The outlook for reauthorization of the federal highway program was described in somber terms this week at a gathering of senior legislative staff members from the key transportation committees in Congress.


The message was that the highway program needs substantive reform, but key pieces of that reform - funding and restructuring of the Department of Transportation - will be quite difficult to put together. The current highway program expires Sept. 30.

The discussion was hosted by the Coalition for America's Gateways and Trade Corridors, an interest group promoting increased investment in intermodal freight. The coalition is pushing Congress to include a National Strategic Freight Mobility Program and Trust Fund as part of the new highway program.

The good news is that Congress is keenly aware of the need to reform transportation policy and increase the focus on freight transportation.

"One thing is certain: The leaders of the committees recognize the importance of the transportation system to the economy and to our quality of life," said Stephen Gardner, a senior Democratic staff member on the Senate Commerce Committee.

Also, work has begun. Rep. James Oberstar, D-Minn., chairman of the House Transportation and Infrastructure Committee, wants a draft bill this spring, a marked-up bill to the House floor before the July 4 recess, and a finished bill by the end of the fiscal year Sept. 30, said Jim Tymon, Republican staff director for the Highways and Transit Subcommittee. Oberstar and Rep. John Mica of Florida, the ranking Republican on the committee, both want a bill in the range of $450 to $500 billion, Tymon said.

However, the primary funding mechanism for the highway program is broke and there's little political will to increase taxes; the national vision that used to animate the program is gone; it will be very hard to come up with a new vision that the public can buy into; and despite Oberstar's schedule the bill is not likely to be finished this year.

The Highway Trust Fund, which ran out of money last year and required an $8 billion transfer from the general treasury, will probably need another bailout by the end of this fiscal year, said Jeff Davis of Transportation Weekly, a publication for legislative insiders.

Congress will have to raise taxes by $100 billion over the next six years just to keep the highway program going on a straight line, Davis said. Tymon noted that this would translate to a fuel tax increase of about 7 cents a gallon. A bipartisan panel appointed by Congress to study the funding issue is going to recommend a 10-cent fuel tax increase, said Kathy Ruffalo, a member of the National Surface Transportation Infrastructure Financing Commission.

In the long term - 20 years or so - the country will have to move to a funding system based on vehicle miles traveled rather than fuel, the staffers generally agreed.

But in the near term, despite talk of tolling, bonds, public-private partnerships, there is no alternative to raising the tax. "There are lots of things you can do around the edges but for the type of revenue we felt the country needed the fuel tax is the only option," Ruffalo said.

Trouble is, there's no political appetite among Democrats or Republicans for a big tax increase, the staffers generally agreed.

"The only way you're going to have the gas tax increase that is needed to fund program growth is if President Obama gets behind it and decides to expend political capital in seeking such a gas tax increase," Davis said. "For that, the administration would probably insist on some kind of serious programmatic reforms."

(For more details, see the March issue of Heavy Duty Trucking magazine.)