Revenue estimates for the Highway Trust Fund show that the shortfall of resources available to address highway and transit investment needs is more critical than first estimated in February 2003.
Twice a year, the Treasury Department makes available estimates of the revenue expected to flow to the Highway Trust Fund from motor fuel and other excise taxes, the retail tax on trucks, heavy-vehicle use taxes and tire taxes.
Those projections are based on travel estimates, economic forecasts and other data. They are currently used in the revenue-aligned budget authority (RABA) calculation, and last year were responsible for a proposed $8.6 billion drop in the highway program recommendations of the administration's budget. The TEA-21 extension act currently in effect suspends the RABA mechanism. Therefore, there is no current RABA calculation.
Estimates issued early this year had projected an average annual growth of net highway account receipts for the 2002-2012 period of 3.19%. However, the latest projections now estimate growth of only 2.57%. This translates into a $4 billion reduction in the estimated revenues for the 2004-2009 reauthorization period of $187 billion, down from $191 billion in February.
The next official estimates of Highway Trust Fund revenues will be released with President Bush's proposed FY 2005 budget early next year, and observers caution that the estimates can swing sharply based upon economic conditions. Since the recently enacted extension of the Transportation Equity Act for the 21st Century expires on Feb. 29, however, the financing package for a long-term reauthorization bill will be based on current revenue projections.
