Thinking local is not enough. Flourishing local efforts must be bolstered by a sound national transportation policy complete with a long-term strategic vision, guided with performance benchmarks, and underpinned by adequate revenue sources.
Funding must be fair, transparent, and sustainable. The transportation program’s primary revenue source is currently the federal gas tax, which is unsustainable. Over time the gas tax has not kept pace with increasing costs of maintenance and construction. As for transparency, recent polls show that the majority of Americans don’t know what the federal gas tax is—it’s 18.4 cents per gallon federally; across the country, total gas tax including local, state, and federal average about 43 cents. Moreover, 60 percent of Americans believe that it goes up every year—in reality its last increase was in 1993 for deficit reduction reasons. Regarding fairness, economic research concludes that the gas tax is a drop in the bucket compared to the overall cost of driving. Those who believe that motorists alone should benefit from road improvements fail to recognize the full cost of driving and the benefits of pricing it fairly.
It’s time that those who benefit the most—oil companies—shoulder more of the burden of the nation’s transportation system. More than 70 percent of our oil supply is consumed by transportation. We send $161 billion per year to countries classified as dangerous or unstable by the state department to continue this consumption.
We recommend that a per-barrel oil fee be added to fill the funding gap. An upstream oil fee would be accompanied by a variable gas tax at the pump. When the global price per barrel increases, the gas tax is abated. When the global price goes down, gas tax slowly increases. For drivers, this creates a predictable price band for gas. For the country, it funds overall mobility. In short, this revenue strategy is a good, immediate solution to filling the funding gap until other options can be implemented.
Congress persisted in delaying action on a new transportation bill and the gas tax over the last year. Last fall, the super-committee, charged with coming up with a deficit reduction package, petered out without any results. At the same time, a group of seven former U.S. transportation secretaries and assorted experts came together at the University of Virginia’s Miller Center to discuss the federal transportation policy impasse. The conclusion: “go local.”
This March 2012 when the latest transportation bill expires, or more realistically in 2013 after the presidential election, Congress has another opportunity to reassess the national transportation program—its vision, goals, structure, and funding.
Federal policymakers need only to look down Main Street. Towns, rural areas, and cities across America are all in on the action, developing local solutions to mobility problems that cannot wait any longer. Collectively, their actions speak volumes about untapped ingenuity that promises a brighter future for U.S. transportation.
Congress should genuinely reform and work to fund a federal program that supports local efforts. Our prosperity and climate and security solutions can all be found on Main Street.
Shin-pei Tsay is the director of cities and transportation at the Carnegie Endowment for International Peace and directs the Leadership Initiative for Transportation Solvency.