Transportation Talk: Can We Stop a ‘Painful’ Transportation Situation?

| March 8, 2014

 potholeroad

We’re in trouble – big trouble – and it’s going to be hard to find a way out. It’s not news to anyone in the transportation construction industry that the nation’s Highway Trust Fund (HTF) is in peril. So far, we’ve put on Band-Aids to scrape by and keep things functioning. But this isn’t just a scratch. We’re hemorrhaging, and if we don’t use a “tourniquet,” the nation’s infrastructure system is going to bleed to death. That tourniquet is a new source of revenue.

Related: VIDEO: ARTBA President Pete Ruane urges ConExpo-Con/Agg attendees to tell Congress to fix Highway Trust Fund

Fixing the HTF without any new revenue would require the equivalent of Congress passing and the president signing a 2013-level Murray-Ryan budget deal every year just to maintain current highway and transit program investments, says Pete Ruane, president of the American Road & Transportation Builders Association (ARTBA), to a Senate panel last month. (The Act is the bipartisan compromise reached by Sen. Patty Murray, D-Wash., and Congressman Paul Ryan, R-Wis.) The HTF will not be able to support any investments in new projects after September. A recent Congressional Budget Office (CBO) report found an average of $16.3 billion is needed each year to preserve the current transportation program. By comparison, according to ARTBA, during a two-year period, the Bipartisan Budget Act of 2013 reallocates resources to increase the no-defense discretionary spending cap by about $16 billion per year.

Ruane cautioned the Senate Environment & Public Works Committee that a “painful scenario” is ahead of us. If the HTF shortfall isn’t addressed, he said the more than 12,000 highway bridge and safety capital projects throughout the nation could be lost. (Go to youtube.com/watch?v=ZFYaSxatANI#t=79 to see a video from Ruane.)

by Tina Grady Barbaccia, Editor-At-Large tinabarbaccia@gmail.com

by Tina Grady Barbaccia,
Editor-At-Large
tinabarbaccia@gmail.com

In 2015, the HTF highway account will have insufficient revenues to meet its obligations, resulting in steadily accumulating shortfalls, according to the CBO report. Under current law, the HTF cannot incur negative balances and has no authority to borrow additional funds. However, following the rules in the Deficit Control Act of 1985, CBO’s baseline for highway spending incorporates the assumption that obligations incurred by the Highway Trust Fund will be paid in full.

The U.S. Department of Transportation has indicated it needs at least $4 billion in cash balances available in the highway account and at least $1 billion in the transit account to meet obligations as they are due, the CBO report notes. This means, according to the CBO’s baseline projections, the highway account may have to delay some of its payments until the latter part of 2014.

The inadequate revenue is like watching our nation’s infrastructure bleed out. As the nation continues in a slow economic recovery, we need to ensure the HTF remains solvent.

To avoid this “painful” scenario, please talk to your Congressman or Congresswomen and let him or her know not only does your job depends on this, but also the nation’s health.

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