New gas tax proposed to refill empty federal tank

WASHINGTON—U.S. Sens. Chris Murphy, D-Conn., and Bob Corker, R-Tenn., on Wednesday proposed raising the federal gasoline and diesel taxes a total of 12 cents per gallon over the next two years.

The senators say this tax will fill the $160 billion hole that will arise over the next ten years if the Highway Trust Fund budget remains unaddressed. The proposal includes looking for ways to offset the impact on American families and businesses by pairing increased gas tax with tax breaks in other areas.

But some fiscal conservatives argue that Congress should stop looking for new revenue sources and focus on reductions in transportation spending. Savings, conservatives argue, could come by diverting some of the dollars spent on transportation alternatives such as bike lanes and putting them towards improving highway congestion and bridge safety.

The U.S. Department of Transportation predicts its highway account within the Highway Trust Fund will run dry before the end of the fiscal year. The fund pays for improvements to roads, bridges, and other mass transit systems.

The proposed raise in federal gas tax would be the first since 1993. Due to inflation, the federal tax of 18.4 cents per gallon has 63 percent of the buying power it did in 1993. The senators’ proposal includes adjusting the tax for inflation in the future.

“Both Republicans and Democrats acknowledge this problem,” Murphy said. “The solution shouldn’t be to just punt again and continue to ask our kids to pay for these projects by continuing to steal from the general fund to fill the funding gap.”

Since 2008, the Highway Trust Fund has received supplements from the general fund. At the beginning of the 2014 fiscal year, the general fund transferred $9.7 billion to the highway account and $2 billion to the mass transit account of the Highway Trust Fund. But even those amounts are insufficient to meet this year’s spending.

Both Democrats and Republicans have proposed ideas for reform in the past. The most recent is a GOP plan to supplement the Highway Trust Fund with money saved through cutting Saturday postal deliveries. Emily Goff, a transportation and infrastructure policy analyst with the Heritage Foundation, said that suggestion does not fix the root problem of the trust fund’s inability to live within its means.

“It makes no sense to take those savings and use them to shore up a trust fund that’s supposed to be self -supporting,” Goff said.

She said Congress is fixated on a new revenue source when it should be looking at how to reform spending. The problem with raising the federal gas tax is that some of the money goes towards other transit methods such as bicycle paths and sidewalks, things Goff said have “no business being paid for by gas dollars.”

The Heritage Foundation reports that in 2010, transit such as light rail, trolleys, and buses received 17 percent of federal highway user fees despite the fact it made up only about 1 percent of ground travel in the nation. Goff suggested if Congress would reduce spending on transportation alternatives, it would free up money to improve highway and bridge safety and congestion.

Goff also pointed out raising the federal tax would strengthen transportation control in Washington when the decisions would be best made at the state and local level. Each state and community has its individual traffic and transportation problems.

The senators acknowledge that their proposal will not be enacted any time soon and that Congress will most likely create a short-term fix for the impending Highway Trust Fund shortfall. Still they are hopeful that Congress can agree on a long-term fix to what Corker calls “one of the largest budgeting failures in the federal government.”