A group representing road builders said Thursday that the federal gas tax should be increased by 15 cents per gallon to help pay for infrastructure improvements.
The American Road & Transportation Builders Association (ARTBA) said increasing the gas tax this year would raise $401 billion for new transportation spending.
The gas tax hike could be offset with a “federal tax rebate for middle and lower income Americans for six years,” the group suggested.
“If our national leaders think they need to use budget gimmicks or ‘one-offs’ again to pass the surface transportation investment program the states need and the business community has been pleading for, then use those devices to provide a $90 tax rebate to middle and lower income tax filers to offset the cost to them of a 15 cent per gallon increase in the federal gas tax,” Ruane said in a statement.
“Don’t use them to just prop up the program for a few years,” Ruane continued. “That won’t resolve the structural damage that’s been done to the Highway Trust Fund, nor will it allow states to do the long-range capital planning that the nation needs.”
Transportation advocates have been pushing for an increase in the gas tax to help for infrastructure improvements for years as lawmakers have struggled to pass long-term federal highway bills.
The gas tax, currently set at 18.4 cents per gallon, has been the traditional source of transportation funding since the 1930s. The tax has not been increased since 1993, however, and it has struggled to keep pace with rising construction costs as cars have become more fuel-efficient.
The federal government typically spends approximately $50 billion per year on transportation projects, but the gas tax only brings in about $34 billion.
Lawmakers have turned to other areas of the federal budget in recent years to make up the difference, but the short-term solutions have resulted in Congress approving only a series of temporary infrastructure funding patches since a 2005 transportation bill expired in 2009, including an $11 billion 2014 measure that is now scheduled to expire on May 31.
Lawmakers have introduced a series of bills recently to extend the expiring transportation funding measure, but they have not yet coalesced around a specific funding source. The idea of increasing the federal gas tax to help pay for construction projects has been discussed, but many lawmakers are reluctant to ask drivers to pay more at the pump.
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Ruane said Thursday that increasing the gas tax would provide a more permanent solution to the transportation funding problem, however.
“Just using repatriation as a one-time, short-term patch for Highway Trust Fund investments does not address or resolve the trust fund’s underlying revenue stream problem,” he said. “After the repatriation ‘fix’ period is over, the trust fund’s cash flow problem not only returns, but will be worse than it is now, threatening another crash in the highway and transit investment program.”
Ruane touted his group’s proposal to offset the gas tax increase with a break on other federal taxes as a possible solution to the political quandary that has bogged down the transportation funding debate for years.
“Our proposal provides an answer for those who believe Americans are not willing or able to invest another $90 a year to improve their mobility and help keep the cost of just about everything they buy down,” Ruane said, adding that repair costs from shoddy infrastructure are already “being passed on to consumers.”
“I submit the mobility we get from our modest, individual contributions transportation infrastructure improvements is an outstanding return on investment,” Ruane continued. “If there is a better plan out there that puts the surface transportation program back on solid ground over the next 10 years with a sustainable growth trajectory, then let’s move on it now. The time for cogitating and fretting is over. The clock is ticking.”