Close the US DOT

With Highway Fund Running Dry, DOT And Congress Look For Revenue

 

WASHINGTON (MCT) - The U.S. Department of Transportation said Tuesday that it would start limiting payments to States for road and transit projects next month in an attempt to conserve the Federal Highway Trust Fund's

rapidly diminishing cash balance.

 

Usually, the department reimburses states for transportation projects upon request. But beginning Aug. 1, the States will have to live paycheck to paycheck, receiving funds only once every two weeks as money is collected through Federal gasoline taxes.

 

The move may put pressure on Congress to approve at least a short-term fix before its August break begins. The DOT estimates that the highway fund will hit zero in late August, potentially idling several hundred thousand workers as midterm elections loom in the fall.

 

Transportation Secretary Anthony Foxx wrote his State counterparts Tuesday that they would see, on average, a 28 percent reduction in funds.

 

"Depending on how they manage the funds, each state will feel the effects differently, but everyone will feel the impact sooner or later," he wrote.

 

Congress has only 16 working days to reach an agreement before the August recess. Finding even a short-term solution might prove difficult. Last week, the Senate Finance Committee attempted to move forward with a $9 billion

proposal to restore the highway fund through year's end.

 

"I hope to see the committee take decisive bipartisan action and send a clear message that stabilizing the Highway Trust Fund is a priority now," said Senator Ron Wyden (D-Ore.), the committee's chairman.

 

But Wyden's plan went nowhere after Republicans said it wasn't bipartisan enough.

 

"I am disappointed that the Senate appears to be heading down a partisan road on highway funding," Representative Dave Camp (R-Mich.), the chairman of the House Ways and Means Committee, said in a statement last week.

 

Since the Interstate Highway System was created in 1956, a per-gallon tax on motor fuels has supported Federal spending on transportation. The tax has been stuck at 18.4 cents for gasoline and 24.4 cents for diesel since 1993, and it has lost its buying power to inflation.

 

Since 2008, Federal transportation spending has exceeded the balance of the trust fund, and Congress has avoided the gas tax debate by transferring more than $50 billion from the Federal Treasury to keep it afloat. While some lawmakers say they don't want to resort to that approach again, they may have no other options if they can't reach an agreement.

 

Republicans want the general-fund transfers to be offset with spending reductions elsewhere, but Congress is running out of offsets. A proposal that Republicans in the House of Representatives circulated last month to pay for a patch in the highway fund by cutting back Saturday mail delivery

went nowhere.

 

Groups that represent business, construction, labor and trucking have been pushing to increase the Federal gasoline tax. Last month, Senators Christopher Murphy, a Connecticut Democrat, and Bob Corker, a Tennessee Republican, offered a bill that would raise the tax by 12 cents a gallon.

 

But President Barack Obama has never endorsed a gas tax increase, and conservative House Republicans are all but assured to oppose one. Obama favors closing corporate tax loopholes to shore up the highway fund, but his plan hasn't attracted much support on Capitol Hill.

 

Source-Curtis Tate, McClatchy Washington Bureau July 1, 2014 <http://personalliberty.com/author/mcclatchytribunepl/>

McClatchy-Tribune  www.mcclatchydc.com.

 

Comments

 

Transportation is not one of the federal government’s enumerated powers and this unconstitutional department has strayed for decades.  It was the major source of boondoggle scandals like ‘bridges to nowhere’ and the life support for Amtrak, $13 billion since 1972.  It became a grant giveaway machine since 2008, showering $billions of matching grants to states for fluff like underutilized light and heavy rail passenger trains, bike lanes, trails and land grabs.

 

The first excuse for federal dollars going to transportation were the railroads that did revert to private corporations. The Interstate highway system was the next major move in 1952 and it created the federal gas tax.  Unions passed Davis-Bacon and doubled the cost. Since then, states and municipalities have been left with interstate maintenance and expansion. 

 

Federal grants are bribes offered in exchange for doing stupid things. Close the US DOT and give the interstates to the states.

 

Norb Leahy, Dunwoody GA Tea Party Leader