On April 25, the Senate Finance Committee released the fourth of six tax-reform option papers. This latest document outlines ideas regarding “Infrastructure, Energy, and Natural Resources.” Included in the paper is a discussion of the status of the Highway Trust Fund (HTF) and a variety of options that could be considered to remedy the situation. Listed below are items highlighted in the document:
Potential broad principles for reform include:
- Generate sufficient resources to support federal transportation policy on a sustainable basis;
- Ensure that users and direct beneficiaries of infrastructure systems bear the cost of their use; and
- Promote economic efficiency by maximizing benefits relative to costs for any projects with federal involvement.
Some specific concerns about infrastructure funding include the following:
- Mismatch between amounts authorized and trust-fund revenues;
- Deterioration of the user-fee model;
- Declining revenue from existing sources;
- Inadequate funding to meet additional needs; and
- Uncertainty created by temporary extensions.
Options proposed and explored by the committee consist of the following areas:
- Limit infrastructure spending to trust-fund revenues;
- Devolve federal revenues to states;
- Maintain the user-fee model but increase existing taxes and fees;
- Establish new user fees and taxes to replace or supplement current user-fee system;
- Designate other sources of revenue for the HTF; and
- Provide additional financing options for states.
