This post was written for The Ground Floor by Robert Dunphy, emeritus fellow, Transportation and Infrastructure for the Urban Land Institute.
“A system in crisis”, is the description of a U.S. surface transportation system which has deteriorated to such a degree that “our safety, economic competitiveness, and quality of life are at risk, according to the report of the National Surface Transportation Infrastructure Financing Commission, (the Financing Commission), “Paying the Way”, (unfortunately misread casually as “Paving Our Way”).
Not only that, but the present system of financing transportation is unsustainable--so we need substantially more money and an entirely different manner of collecting it. The assessment reinforced a new quadrennial survey of the American Society of Civil Engineers, which found that since the last study in 2005, the condition of roads, aviation and transit deteriorated from already low ratings, while most other categories remained unchanged and mediocre to low ratings, and only one category, energy, actually improved.
The Financing Commission reviewed various assessments of the degree of underspending needed to maintain and improve the nation’s highway and transit systems, put forward their assessment that current spending was about one-third of what seemed appropriate, the second lowest measure of six national surveys reviewed. Perfect opportunity for a stimulus, right? Except the Finance Commission reckons that the enormous federal stimulus program, originally targeted for infrastructure, became sufficiently diversified that it would pay for about 3-4 months of infrastructure spending. So not only is substantially more money needed, but a different model of collecting it.
Commissioner Mike Krusee, a member of the Texas legislature, pointed out that the current system generates revenue by rebating money back to states according to the number of miles driven, “a direct contrast with the policy goal of discouraging driving to meet energy security and sustainability goals.” Moreover, the shift to fuel efficient vehicles, according to Commission Chair Robert Atkinson, president of the Information Technology and Innovation Foundation, “will make it increasingly difficult to rely on the gas tax to raise needed funds.”
The long term solution recommended by The Financing Commission is to transition from charging by gas used to mileage driven, embodying more of a “user pay” principle--drivers are currently estimated to pay less than 60 percent of combined federal, state, and local transportation costs. This is an idea beloved by economists and environmentalists, but with significant political downsides, including potential privacy concerns.
Addressing the immediate funding crisis, the Financing Commission recommends expanded private investment, as well as a 10 cent per gallon increase in the federal gas tax, with future indexing to inflation, to protect against the one-third drop in purchasing power of the federal gas tax since it has not been increased since President Clinton’s first term.
These problems have seemed intractable for years, with engineers, economists, and policy wonks of all stripes acknowledging that the U.S. is not spending enough to even maintain our transportation networks, much less accommodate growth, while calls for addition funding by increasing existing taxes on users have been political non starters because of anti-tax zealots. Perhaps the changed attitudes toward public spending in the U.S. and the growing emphasis on infrastructure investments to lay the foundation for long term economic growth will finally break the political gridlock.
