PART 1: Our Nation’s Highways – Will Funding Run Out Entirely?

Anyone who gets behind the wheel knows that our nation’s roads are in disrepair and getting worse. As annoying as that is for motorists, it’s an even greater financial strain for professional truckers who have to navigate the system in a timely and cost-effective manner. But as bad as the highways are, federal policymakers seem unable to find the money to improve matters.

Just a few months ago, the Congressional Budget Office noted that the Highway Trust Fund is so low on resources that Congress would need to cut off funding for highways and transit projects as of 2015. Industry sources predict that within the next 20 years, Trust Fund revenues will be $365 billion shy of what’s needed to maintain current levels (adjusted for inflation) of federal highway spending.

Can the feds learn from state funding programs?

States also fund programs to maintain roads and bridges. Researchers at the College of William & Mary’s Thomas Jefferson Program in Public Policy wondered if federal funding could be replenished by using financing mechanisms similar to those that have been adopted by various states. Toward that end, they conducted a study last year that examined how states pay for road and other infrastructure maintenance, and then used the data to create a comparison matrix. The hope is that lawmakers on Capitol Hill will use the matrix to look for new solutions.

Industry watchers also predict that increasing financial responsibility for highway work will fall on individual states, most of which are facing huge fiscal crises of their own.

If nothing is done about the predicted Highway Trust Fund shortfall, an estimated 12,000 highway, bridge and safety capital projects nationwide may go unfunded, according to Pete Ruane, president of the American Road & Transportation Builders Association (ARTBA). Trucks transport more than $11 trillion worth of freight around the country each year, and Ruane notes three-quarters of that travel is on the federal highway system. Both safety and economic viability are significant risks for trucking companies.

Is increasing fuel taxes the answer?

But Ruane says there’s a potential upside – one that could bring more public pressure to bear on Congress to fix mounting highway funding problems. He suggests that simply educating taxpayers about the value received for the money spent could have a significant impact.

Better public understanding of what’s at stake and how well money is actually spent might make taxpayers more willing to invest more. Ruane notes that a typical American household spends about $160 each month on cell and landline phone service, compared to just $46 per month spent via state and federal fuel excise taxes. He suggests that, if Americans were willing to invest equally in roads and phones, funding challenges would cease to exist.

Of course more than tripling fuel taxes would have a dramatically different effect on professional truckers than on individual taxpayers, and the effects would undoubtedly ripple throughout the economy for goods delivered over the road.

So what do you think? In our next post we’ll look at another challenge that’s compounding our nation’s problems when it comes to building and maintaining roadways.