As highway-funding deficit looms, administration still opposes gas tax increase

Mary Peters recently met with House and Senate committees to hear concerns about the administration's budget proposals

News AASHTO Journal February 15, 2007
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U.S. Transportation Secretary Mary E. Peters met with House and Senate committees last week to hear concerns about the administration's budget proposals. But she said while there is concern about the future of the Highway Trust Fund, the Bush administration steadfastly opposes increasing the federal gas tax.

Peters appeared on Thursday, Feb. 8, before the Senate Appropriations Subcommittee on Transportation, Treasury, the Judiciary, Housing and Urban Development and Related Agencies and the House Transportation and Infrastructure Committee.

At both stops she conceded that under the administration's budget, the Highway Account of the Highway Trust Fund will be operating in a deficit in coming years. The FY 2008 budget proposal attempts to reduce the size of the shortfall by suspending a $631 billion RABA payment to the states, and also by rescinding another $1.4 billion in past apportionments. That will still leave the account $230 million short in FY 2009.

Sen. Robert Bennett (R-Utah), a member of the Appropriations Subcommittee asked Peters if there was a way to "justify" an increase in "taxes."

Peters told senators and reporters after the hearing that the administration remains against any increase in the 18.4-cent federal gas tax.

Subcommittee chair Sen. Patty Murray (D-Wash.) led off the hearing reminding colleagues of a more immediate matter than the FY 2008 budget, passing a joint resolution appropriating funds to keep the U.S. DOT and 10 other federal agencies operating beyond Feb. 15. The House recently passed a $463.5 billion resolution that included close to $4 billion increase for transportation over FY 2006 levels as called for in SAFETEA-LU. The continuing resolution passed by the 109th Congress last year provided funding at FY 2006 levels and expired this week.

Murray expressed disappointment with the rise in motor vehicle fatalities. She said motor vehicle deaths increased to more than 43,500 in 2005 and the administration is backing off its goal of reducing fatalities to 1 per 100-million vehicle mile traveled by 2008. The FY 2008 budget proposal backs off reaching that goal to 2011.

Transit also takes a hit in the U.S. DOT FY 2008 budget. Sen. Wayne Allard (R-Colo.) criticized the cut in transit funding, saying large and medium-sized cities should be encouraged to explore mass-transportation options with federal assistance. Peters said the transit funding in FY 2008 is being spent on projects that are "ready to go."

Sen. Christopher "Kit" Bond (R-Mo.) endorsed the administration's proposal to increase corporate average fuel economy (CAFE) standards for passenger vehicles, light trucks and sports utility vehicles by weight, saying the responsibility to evaluate these measures is better left to the U.S. DOT instead of Congress.

Talk of CAFE standards led to addressing the need to resolve the near- and long-term solvency of the Highway Trust Fund. Peters cited the work of the National Surface Transportation Policy and Revenue Study Commission, which she chairs, as considering long-range solutions. The commission is expected the present its recommendations to federal officials by the end of the year. "This [Highway Trust Fund revenues] is a looming crisis," said Murray. "I hope to see something [recommendations] sooner."

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