TRANSPORTATION FUNDING

Time To Put States In the Driver's Seat (3/29/2004)

By Rakesh Tripathi

	TRIPATHI

In an election year, Republicans and Democrats can agree on at least one thing—that highway spending is essential to win re-election. They also know that in order to maintain our national economic health, we must fix our aging and distressed transportation system. Yet after prolonged squabbling between Congress and the White House, the Senate only recently passed a $318-billion transportation bill with a seemingly veto-proof margin of 76-21. The President’s proposal, in comparison, is a modest $256 billion. Some in the House last year proposed a Cadillac version worth $375 billion, but lawmakers there now are considering a $275-billion bill. So despite months of debate, we still have no agreement.

The squabbles in Washington clearly highlight the dysfunctionality of our current highway funding process. And that has an adverse impact on everyone. In a jobless economic recovery, increased transportation funding results in instant job creation. These jobs are immune to outsourcing abroad and have a positive effect on governmental tax receipts and the economic well-being of all Americans.

Congress is nearly six months late in passing this important legislation and political and financial troubles could mount as the debate continues. The ballooning federal deficit is casting an ominous shadow over the ultimate size of the bill. As this desultory legislative scenario continues, any compromise will only reduce the amount of spending essential to correct our obsolete and overwhelmed transportation system. In the long run, the six-year transportation bill reauthorization process is inefficient and unfair.

To cure this corrupt and inefficient process, Congress and the administration need to put the concept of trust back into the Highway Trust Fund. Every time we pump a gallon of gas into our cars, we pay 18.4¢ in federal tax to fund this trust. Then every six years, Congress establishes funding limits, adds billions of dollars in pork projects in strategic congressional districts and then, with a thousand strings attached, tells states how they should be spending their money. Let’s cut the crap and get down to business.

New View
I propose that we eliminate the congressional reauthorization process. The Highway Trust Fund needs to be radically reformed in order to become effective and the responsibility clearly should be shifted to the states.

New transportation funding levels should be directly proportionate to the tax receipts of each state, rather than the product of congressional consensus. Out of the 18.4¢-per-gallon fuel tax, the states should be authorized to collect 17¢ and the remaining 1.4¢ should be sent to Washington, D.C., to be deposited in a leaner trust fund. The intent of the 1.4¢ contributed by the states would be to fund interconnectivity projects, provide for research and establish a rainy-day fund to help states in times of natural disasters, such as earthquakes and hurricanes. This new legislation should mandate that money collected by states on the behalf of the federal government be dedicated exclusively for transportation. It should also provide a mechanism so that any unspent balance from the leaner trust fund is deposited in the state account every five years.

The trust fund should be renamed the National Transportation Trust Fund. The states should be given the authority to spend money on any mode of transportation they deem appropriate for their citizenry. If New York wants more railways or Texas wants to build its multi-modal Trans-Texas corridor, they should have the authority to mix public funds with private funds in any combination they desire to meet the local needs.

This will not only stretch highway dollars but also eliminate the politically driven micro-management that we get from Congress. The states should be treated as mature governing entities that know best how to take care of their own business. The federal government should limit itself to policy and big-picture issues rather than just earmarking pork projects to help insecure congressmen get reelected.

Rakesh Tripathi is assistant director of planning for the Texas Dept. of
Transportation, Houston. He can bereached at rtripat@dot.state.tx.us

Click here for opinions archives >>

If you have an idea for a column, please contact Viewpoint editor William J. Angelo.