Federal Transportation Funding 2011
By Chrissy Mancini Nichols
Jul 15, 2011
This post first appeared at metroplanning.org
Did You Know? President Eisenhower appropriated $25 billion in 1956 for the Interstate and Defense Highways Act, about $210 billion in today’s dollars.
Status of the next federal transportation program
Last week, U.S. House Transportation and Infrastructure Committee Chairman John Mica (R-Fla.) outlined a proposed six-year federal transportation program. The plan would spend only the $230 billion the Federal Highway Trust Fund will take in over the period from the 18.4 cent per gallon federal motor fuel tax. That’s much less than the $556 billion White House proposal, and a big cut from the $286 billion, six-year SAFETEA-LU authorization in 2005.
The positives: Six billion is dedicated to the Transportation Infrastructure Finance and Innovation Act (TIFIA) loan program, which could fund $120 billion in transportation projects. Rep. Mica also proposes to streamline government by consolidating or eliminating approximately 70 programs, improving the delivery time of projects, and instituting performance measures.
However, there are significant downsides to the Mica plan. At a time when demands for new and better transportation improvements are at an all-time high, the proposal cuts funding by 35 percent in fiscal year 2012, resulting in a loss of 630,000 jobs next year alone. And while the 80/20 percent split between highway funding and transit is preserved, Mica said rural and suburban areas would receive a greater percentage of the money set aside for transit. That switch, along with less funding overall means Chicago’s already cash-strapped transit agencies would take a huge hit.
Also important for the Chicago region, funds will no longer be set aside for bike and pedestrian projects or inter-city high-speed rail, and the highway program will focus on “Interstate Highways and the National Highway System.” According to Transportation for America, if funds were restricted to routes on the National Highway System, the number of highways states can invest in would drop by 83.5 percent. Then, there’s the added cost of refocusing federal transportation objectives on long-distance travel, instead of urban networks of roads and highways where we know congestion occurs.
If Chairman Mica’s proposal is a starting point to where our federal transportation program is headed, there are two things to consider as the political process moves forward:
• With a reduction in funding of this magnitude, performance measures and strategic planning are critical. Every dollar MUST be spent to gain the greatest impact. Precisely because there is a limited supply of federal dollars, we must evaluate potential investments based on their ability to reduce hours spent in traffic, curb emissions, and connect affordable homes and jobs. The criteria should not be about how much is spent, but rather whether each investment gets us closer to our goals.
• Every dollar that U.S. taxpayers invest in public transportation generates $6 or more in economic returns. Spending on transportation infrastructure is one of the best investments government can make. Other nations know it; China spends nine percent of gross domestic product on infrastructure and Europe five percent. The House proposal represents 1.5 percent of the United States’ economy. That gets us to the root of the problem: The current funding approach to building America’s transportation system, unchanged since 1993, is unsustainable. As consumers continue to choose fuel-efficient vehicles over gas guzzlers, less frequent trips to the pump will mean even fewer dollars going into the nation’s bankrupt Highway Trust Fund. The country needs a new, reliable revenue source to fund the transportation improvements commuters and employers desperately need.
The Senate proposal
Sen. Barbara Boxer (D-Calif.), chair of the Senate Environment and Public Works Committee, said she will propose a two-year, $109 billion transportation bill. The two-year bill would require an infusion of $12 billion to the Highway Trust Fund. Sen. Boxer said, “We spend $12 billion a month in Iraq and Afghanistan, all we are looking for here is $12 billion over two years.” More details of Boxer's plan should surface soon.
The next federal surface transportation bill (familiarly known as T4) offers the best opportunity to change America’s surface transportation policy to improve our global competitiveness, as well as community livability and sustainability. In February MPC submitted testimony to Chairman Mica supporting an approach to the federal bill that is strategic, reduces gridlock and the demand for costly transportation expenditures, makes existing transportation infrastructure more efficient, creates new financing tools, and demonstrates the value of innovative investments.
With the looming Sept. 30 expiration of the last extension (the seventh since SAFETEA-LU expired), it seems an eighth extension may be in the cards. Stay updated on the progress in the House and Senate via MPC’s web site and Talking Transit throughout the summer.
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