House Bill 1242 and Senate Bill 267, two top issues are on life support, their sponsors say

The Colorado legislative session’s top priority, a major transportation bill that seeks a tax hike to improve and expand highways, is unlikely to win approval this term.

Senate President Kevin Grantham, a Cañon City Republican and one of the prime sponsors, announced Thursday morning that he does not have the votes to move it through the GOP-led chamber.

“At this point, we can’t count to three,” he said, describing the number of votes he needs to advance it through the Senate Finance Committee next week.

Read on…

NORTHGLENN, CO – APRIL 1: Cars drive northbound on I-25 with the new express toll lane, indicated by the double white line, on April 1, 2016, in Northglenn, Colorado. CDOT officially opened the I-25 North express toll lane on Monday. Construction is still underway on a concrete sound barrier wall that runs alongside the interstate. (Photo by Anya Semenoff/The Denver Post)

Sen. Tom Carper (D-Del.) is introducing legislation that would nearly double the 18.4-cents-per-gallon federal gas tax to help pay for road and transit projects around the nation.

Carper’s bill would increase the gas tax by 4 cents per year for the next four years, resulting in a 16-cents-per-gallon increase by 2020. 

The legislation would offer tax credits to offset the impact of the gas tax hikes on drivers, according to Carper’s office.

The Delaware senator said the failure of Congress to pass a long-term transportation bill this summer showed it is time to raise the gas tax, which has not been increased since 1993.

“Rather than lurching from crisis to crisis, increasing country’s debt, and borrowing more money from foreign governments to pay for our transportation system, I say it’s time to do what’s right,” Carper said in a statement, referring to the three-month transportation funding patch that was approved by Congress before lawmakers left for recess last month.

“At a time when gas prices are some of the lowest we’ve seen in recent memory, we should be willing to make the hard choice to raise the federal gas tax,” Carper continued. “To balance the 16-cent cost of a gas tax hike, I’ve suggested making permanent certain expiring tax cuts that will directly benefit hard-working Americans.”

Under Carper’s legislation, known as the TRAFFIC Relief Act, drivers would ultimately pay 34 cents per gallon in federal gas taxes, in addition to state taxes.

Transportation advocates have pushed for a gas tax increase for years to close an approximately $16 billion annual shortfall in infrastructure funding that has developed as cars have grown more fuel efficient.

The current tax of 18.4 cents per gallon brings in about $34 billion per year. The federal government typically spends approximately $50 billion in funding per year, which transportation advocates have said is barely enough to cover the repair needs of the current U.S. infrastructure system.

The shortfall has resulted in Congress failing to pass a transportation funding bill that lasts longer than two years since 2005.

If the gas tax were to have been indexed to inflation since it was enacted in 1993, drivers would be paying about 30 cents per gallon on their gasoline purchases now.

Carper said the repeated highway spending patches have shown there is no better solution to the transportation funding problem than increasing the gas tax.

“The trust fund we use to pay for our roads, highways, bridges, and transit systems has been broken and has needed fixing since 2008, but Congress can’t seem to get the job done,” he said.

“America has funded transportation systems, including the entire Interstate Highway System, with the gas tax for 83 years,” Carper continued. “Inflation, fuel-efficient cars, and other factors mean we don’t take in as much money as we used to, yet the need to maintain and improve our transportation systems hasn’t dropped. In fact, most experts argue we need to be doing more.”

By Keith Laing

The Hill

The price of gas may be going down nationally, but Washington drivers — already paying above the national average — may see even higher prices at the pump following Saturday’s 7-cent-per-gallon increase in the state’s gas tax.

The increase is the first of a two-step jump to pay for transportation projects across the state.

With state gas taxes now up to 44.5 cents a gallon, adding in the current federal gas tax of 18.4 cents, the total per gallon gas tax in Washington is now 62.9 cents. The state increase was part of a $16 billion, 16-year transportation revenue package approved by the Legislature and signed by the governor earlier this summer. Next summer, the tax will increase an additional 4.9 cents a gallon, putting the total state tax at 49.4 cents — which based on current rates, would make it the second-highest gas tax in the nation behind Pennsylvania, according to the American Petroleum Institute.

“Nobody likes to have a tax increase. But we haven’t been as diligent on maintenance and preservation as we’ve needed to be,” Republican Sen. Curtis King of Yakima said. “We need to invest in that to get caught up. If we don’t do it in the next two or three years, those repairs, it’s going to cost us three or four times more.”

The plan spends $8.8 billion on state and local road projects and $1.4 billion on maintenance and preservation. About $1 billion will go to non-highway projects, such as bike paths, pedestrian walkways and transit. It also allows Sound Transit to ask voters to pay for potential expansions of its rail line.

House Transportation Committee Chairwoman Judy Clibborn, a Democrat from Mercer Island, said that while the projects will take years, ultimately drivers will see the benefits.

“In the short run they might be looking at construction, but in the long run they will see things continuing to work to meet congestion,” she said.

Washington wasn’t the only state to increase its gas tax this year, according to the National Conference of State Legislatures. Georgia, Idaho, Iowa, Nebraska, South Dakota, and Utah all increased their taxes, while two other states — Kentucky and North Carolina — altered the structure of their gas taxes in order to limit decreasing revenues.

Meanwhile, the average price of gasoline has dropped nationally in recent days. The national average for a gallon of regular gas was at about $2.67 on Friday, according to auto club AAA. That’s down 7 cents from the previous week.

The state average is much higher, at about $3.18 per gallon as of Friday. Prices in the state have held pretty steady for the past month, though they are down about 74 cents from a year ago.

Because the gas tax is paid by fuel wholesalers, not added directly to prices at the pump, it’s uncertain how much of an increase drivers will see in the coming days and weeks, especially since gas prices fluctuate regularly.

“By the time the fuel arrives at the gas station, the actual tax has been paid on it, however the retailers and distributors factor it into their price,” said Tony Sermonti, with the state Department of Licensing, which collects the tax.

 

By Rachel La Corte,

The Associated Press

 

The House and Senate are moving toward passage of a three-month patch to keep federal highway and transit aid flowing to states while lawmakers seek the right mix of policy and revenue to achieve a long-term transportation deal.

The House is expected to take up the short-term, $8 billion bill on Wednesday before leaving town for Congress’ August recess. The Senate plans to take up the House bill later in the week, but before a midnight Friday deadline when authority for the Department of Transportation to process aid payments to states will expire.

Lawmakers said they were loath to take up yet another short-term transportation funding extension — this will be the 34th extension since 2009. But Republicans and Democrats don’t want to see transportation aid cut off, and they are eager to pass an amendment attached to the extension bill that fills a $3.4 billion hole in the Department of Veterans Affairs’ budget. The money gap threatens to force the closure of hospitals and clinics nationwide.

Before taking up the short-term extension, Senate GOP leaders say they are determined to first pass their own sweeping, six-year transportation bill. The $350 billion bill would make changes to highway, transit, railroad and auto safety programs, but only provides enough funds for the first three years.

The bill also renews the Export-Import Bank, which makes low-interest loans to help U.S. companies sell their products overseas. The bank’s charter expired on June 30 in the face of opposition from conservatives, who call it corporate welfare.

Senate GOP leaders have been struggling to complete work on their long-term transportation bill before the August recess in the hope that the House would pass it and send it to the White House. But their Republican counterparts in the House have made it clear they won’t be hurried into accepting the Senate measure.

“The House also needs to make its voice heard and put forth its own priorities for such a significant piece of legislation,” Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, said in a statement.

It has been a decade since Congress last passed a 6-year transportation bill even though lawmakers in both parties generally support highway and transit aid. The difficulty has been finding the money to pay for programs in a way that doesn’t increase the federal deficit.

For decades, highway and transit programs were paid for with gas tax revenues and other transportation taxes and fees. But the federal 18.4 cents a gallon gas tax hasn’t been raised since 1993 while the cost of construction has risen. The gas tax brings in about $35 billion a year for highway programs, but the government is spending about $50 billion. President Barack Obama and many lawmakers say even $50 billion is far too little.

Congress could raise the gas tax, but lawmakers fear a voter backlash. Obama and House Republican leaders want to change corporate tax laws that encourage U.S. companies to park profits overseas and use the resulting revenue to fully pay for a 6-year transportation bill.

But there is no consensus on the details of the corporate tax changes, and Senate Majority Leader Mitch McConnell, R-Ky., said he’s skeptical they “can be shoehorned into a multiyear highway bill by the end of the year.”

By Joan Lowy,

Associated Press

A man walks his bike across the street in front of a large pothole at Eighth Avenue and Kalamath Street in Denver.

RJ Sangosti | The Denver Post | Getty Images
A man walks his bike across the street in front of a large pothole at Eighth Avenue and Kalamath Street in Denver.

As states from Connecticut to California scramble to find money to fix crumbling highways, Congress once again is expected this week to put a short-term patch on the nearly insolvent federal highway trust fund.

But if past spending patterns hold up, the repairs and upgrades for the roadways whisking lawmakers around the nation’s capital will enjoy generous subsidies from the rest of the 50 states, according to Transportation Department data.

For every dollar collected in federal highway gasoline taxes in fiscal 2013, the latest data available, the District of Columbia got back $8.56—the highest ratio in the country.

Most states receive more in federal highway appropriations than the fund collects every year—which is one reason it’s perpetually running on empty these days. In fiscal 2013, the fund collected $31.8 billion—mostly from the federal tax on gasoline and diesel fuel, and paid out $39.7 billion. Since 1956, according to DOT data, the fund has paid out $971.7 billion—some $138 billion more than it collected.

While most states get back more than they send to Washington, the nation’s capital is historically a big winner. Since 1956, it’s collected $4.69 for every dollar paid in by drivers in the district. Over the same period, only Alaska, which has averaged $6.08 for every dollar paid, has fared better.

The biggest losers have been Michigan (99 cents back for every dollar paid in), Indiana, North Carolina and South Carolina (98 cents each), and Texas (95 cents on the dollar).

For nearly six decades, the federal highway trust fund has been fueled largely by a tax on a federal gasoline and diesel sales, which the Transportation Department then apportions to state highway departments and other transportation agencies.

But, largely because the tax has not been raised in more than 20 years, rising construction costs have overtaken the increase in tax receipts. Adjusted for inflation, every dollar of gasoline tax collected in 2015 buys about the equivalent of 60 cents worth of roadwork in 1993, the last year the tax was raised.

Fuel tax receipts have also failed to keep up with the increased traffic on the nation’s highways. While Americans are driving more vehicle miles again since a dip during the Great Recession, fuel consumption has declined as cars and trucks have become more fuel-efficient.

The result is that America’s transportation system is falling apart, despite combined federal, state and local spending that hit $91 billion a year in 2013, according to the American Society of Civil Engineers.

That’s about half of what’s needed to repair and upgrade the nation’s highways, according to the Federal Highway Administration

To make up the shortfall, Congress has transferred more than $53 billion from other tax revenue over the past five years, according to the Institute on Taxation and Economic Policy.

Last week, the House passed a bill that would kick the funding can down the highway with another $8 billion until December while lawmakers try to work out a longer-term funding plan. But Senate Minority Leader Mitch McConnell (R-Ky.) is pushing for a bill that keeps the highway fund solvent through next year’s presidential election.

This week, Congress is expected to try once again to cobble together more money to keep road repair work going.

As in the past, the latest highway funding renewal bill has been stuck in a slow lane debate over issues that have nothing to do with potholes. Much of the haggling has involved efforts to revive to the recently expired Export-Import Bank, a federal agency that helps companies finance sales of products to foreign buyers of U.S. goods and services.

Last year, Congress cobbled together a short-term patch that included a provision to let pension fund managers “smooth” out the accounting for volatile investment returns, a move that saved U.S. companies an estimated $51 billion in pension contributions, according to analysts at Moodys.

The thornier problem—one that has stalled a permanent highway funding fix for years—is a perennial roadblock over where to find the money.

After a massive federal stimulus program wound down in 2011, states have been unable to count on a long-term, reliable funding plan from Washington. Since 2009, federal lawmakers have passed 34 short-term extensions to keep transportation programs from running out of money, according to the Associated Press.

This year, lawmakers face a July 31 deadline to renew federal spending authority for transportation programs, without which the Transportation Department can’t reimburse states for billions of dollars in road projects, many of which are already underway.

Congress will also need to refresh the dwindling trust fund’s balance, which is expected to fall below $4 billion by the end of the month. At that point, DOT officials say, they’re pretty much running on empty, and some payments back to the states may have to be cut off.

While Congress continues to scrounge for additional sources of funding, one thing seems clear. No one is even talking about raising the tax on motor fuel.

“Read my lips,” McConnell told reporters Monday. “We’re not raising the gas tax.”

By John W. Schoen

CNBC

A Republican House member is introducing legislation to increase the federal gas tax by 10 cents-per-gallon to help pay for transportation projects across the nation.

The measure, sponsored by Rep. Tom Rice (R-S.C.), would offset the gas tax increase with a $133 income tax credit that would be offered to drivers to minimize the impact of higher prices at the pump.

Rice said in an interview with The Hill that his measure would not cost extra money but would give states “certainty” about the availability of federal transportation funding as a July 31 deadline for the expiration of the current spending bill looms.

“We have enough revenue already,” he said. “Our measure moves money from the general fund into the Highway Trust Fund. It would raise the gas tax by about 10 cents-per-gallon, which would cost the average driver about $130 per year. It would be offset by a $133 income tax credit, so it’s revenue-neutral.”

Congress has been grappling since 2005 with a transportation funding shortfall that is estimated to be about $16 billion per year, and it has not passed a transportation bill that lasts longer than two years in that span.

The 18.4 cent-per-gallon federal gas tax has been the main source of transportation funding for decades, but it has not been increased since 1993, and more fuel-efficient cars have sapped its buying power.

The federal government typically spends about $50 billion per year on transportation projects, but the gas tax only brings in approximately $34 billion annually.

The non-partisan Congressional Budget Office has estimated it will take about $100 billion, in addition to the gas tax revenue, to pay for a six-year transportation funding bill.

Transportation advocates are pushing for a gas tax increase to pay for a long-term transportation bill, but Republican leaders in Congress have ruled out a tax hike.

Rice said his measure would index the gas tax to inflation after the initial 10-cent increase is put in place to prevent future standoffs about transportation funding in Congress.

“I hope we don’t have to have anymore short-term extensions,” he said. “I think it’s very harmful to our country. Infrastructure is vital to our economy and it’s vital to our competiveness.”

Rice’s bill would result in drivers paying 28.4 cents per gallon on gas purchases, in addition to state fuel taxes, to help pay for infrastructure improvements.

The Department of Transportation has said its Highway Trust Fund will run out of money at the end of this month if Congress does not come to an agreement on an extension in the next couple of weeks.

Lawmakers have turned to other areas of the federal budget to close the transportation funding gap in recent years, resulting in temporary fixes, such as a two-month patch approved by lawmakers in May that is set to expire on July 31.

A $275 billion bill, known as the DRIVE Act, has been introduced in the Senate, but lawmakers in the upper chamber have not revealed how they would pay for the measure. The House has been largely silent on the transportation funding deadline, beyond GOP leaders such as House Ways and Means Committee Chairman Paul Ryan (R-Wis.) and Majority Whip Kevin McCarthy(R-Calif.) ruling out a gas tax hike.

If lawmakers cannot come up with a way to pay for a long-term transportation bill by the end of July, they will likely have to settle for another short-term patch.

By Keith Laing

The Hill

California is considering increasing the amount of money drivers in their state will have to pay at the pump to help pay for transportation projects as federal road funding dries up.

Legislation has been introduced in the California state Senate that would increase the state’s approximately 47 cents-per-gallon gas tax by 10 cents.

The new California fuel levy, which would be the state’s first increase since 1994, will be collected on top of an 18.4-cents-per-gallon federal gas tax that is charged to all drivers in the nation to fill the federal government’s transportation funding coffers.

 The American Petroleum Institute says the gas tax increase will bring the total amount of money that drivers in California are charged at the pump to more than 75 cents per gallon.

The state is the latest to consider increasing its gas tax in recent years as federal transportation funding has dried up.

Lawmakers in Congress are currently facing a July 31 deadline for the expiration of federal transportation funding, and they are struggling to come up with a way to pay for a long-term extension of the measure after passing a patch in May that last only two months.

Transportation advocates in Washington have pointed to the willingness of states like California to raise their own gas tax as evidence that a national hike would be politically palatable this year.

Conservative groups in Washington have made clear that they would consider an increase in the federal fuel levy a tax hike, however.

The national gas tax has been the traditional source of transportation funding since its inception in the 1930s. The tax has not been increased since 1993, however, and improvements in auto fuel efficiency have sapped its purchasing power.

The federal government typically spends about $50 billion per year on transportation projects, but the gas tax only brings in approximately $34 billion annually at its current rate.

Lawmakers have turned to other areas of the federal budget in recent years to close the $16 billion per year gap, but transportation advocates have said the resulting temporary funding measures are preventing states from completing large construction projects.

By Keith Laing

The Hill

Oregon is testing a new system that would tax drivers by the mile to pay for transportation projects.

The system, which is known as MyOreGo, will be the first so-called “vehicle miles traveled” program in the nation. The Oregon Department of Transportation says the program will be voluntary and has promised drivers’ personal information will be protected.

“OReGO is the Oregon Department of Transportation’s new road usage charge program. OReGO volunteers will pay for the miles they drive, creating a fair and sustainable way to fund road maintenance, preservation and improvements for all Oregonians,” the agency said on the program’s website.

Drivers who join the program will be charged 1.5 cents per mile for trips that take place on Oregon roads. Participants will be given the option of using a GPS to record their miles or using a non-GPS option that will track usage based on the mileage counters of cars.

In return for participating, the drivers will be offered a tax credit reimbursing them for the 31-cent-per-gallon Oregon gas tax.

Participation in the program will initially be limited to 5,000 cars.

The idea of switching to a mileage-based tax system to bolster sagging transportation funding has been proposed before at the national level, but was quickly dismissed amid critics’ complaints that monitoring the number of miles drivers traveled would violate their privacy.

Transportation advocates say something must be done to shore up the dwindling revenue stream from the federal gas tax, which is set at 18.4 cents per gallon.

The tax has not been increased since 1993 and has struggled to keep pace with construction costs, as cars have become more fuel efficient.

The federal government typically spends about $50 billion per year on transportation projects, but the gas tax only brings in about $34 billion each year at its current rate.

Federal budget analysts have estimated it will take about $100 billion, in addition to the gas tax revenue, to pass a transportation bill that lasts at least five years, which is the traditional length of multi-year infrastructure funding packages that have been passed by previous Congresses.

Lawmakers have balked at both the idea of asking drivers to pay more at the pump and at taxing them by the mile to help pay for transportation projects, so they settled on a two-month extension of a transportation funding bill that was scheduled to expire on Sunday.

By Keith Laing

The Hill

 

Observers are lining up to credit the weekly satirical news show HBO’s Last Week Tonight and its acerbic host John Oliver with reversing the Federal Communications Commission’s decision on net neutrality. So I watched with interest as the show turned its gaze to the topic of the nation’s crumbling infrastructure: our dams and dikes, ports and pipes, roads and rails.

That it’s difficult to hold people’s attention when it comes to infrastructure was actually the running joke of the segment. It began with real Hollywood footage from summer blockbusters of fake exploding roads, runways, dams, and bridges. It ended with a tongue-in-check star-studded movie trailer about an alternative concept: maintaining that infrastructure before it falls down or becomes dangerous. (The clip featured what has to be the first-ever dramatic use of the line: “Lefty loosey, righty tighty.”)

But in between the show raised an important point: Why do we only care about infrastructure when a tragedy occurs? From fractured water systems, to commuter rail accidents, to disintegrating bridges, to broken levees, one of the only times infrastructure gets any attention is when it fails. Unfortunately, due to lack of attention to basic maintenance and upkeep, there is concern that such problems are fated.

The other way infrastructure gets attention is when new things are built—especially roads. Oliver and his team probably overemphasized but perfectly skewered politicians’ attraction to oversized novelty scissors used to cut celebratory ribbons on top of virgin ribbons of asphalt. Lots of analyses show that in this country we do a great job building new stuff, but it’s the lack of attention as it ages that is our real problem.

And that leads to the other big problem addressed by the show. Because it’s not top of mind, leadership in Washington—both the executive and the legislature—is not enthusiastic about raising taxes to reinvest, especially the gas tax. One manifestation of this dilemma is that the federal highway trust fund, the primary source for road, bridge, and transit funding, is slated to run out of money at the end of May.

But while the show got all that right, it missed the mark by failing to recognize the diverse and highly fragmented ways that America selects, builds, maintains, operates, and pays for assets as different as public transit, telecommunications, and water. To be sure, for certain sectors federal spending is relatively high, such as transportation and water for which federal spending averaged $92.15 billion each year from 2000 to 2007. But even for those sectors, the federal share of total spending was never higher than 27 percent during that time. How choices are made about American infrastructure is exceedingly complex and depends on funding sources, jurisdictional concerns, and political negotiations.

So while some in Congress are tight-lipped about their ideas for reinvesting in infrastructure, it’s our cities and states, as well as the private and non-profit sectors, that are literally rebuilding this country from the bottom up. From gas tax increases in Iowa, to new partnerships on water in Bayonne, to new infrastructure institutions in Chicago, the nation is not waiting around for Washington to provide Americans with the reliable and modern infrastructure they need to build greater economic opportunity and create more and better jobs.

In the end, I know it’s just comedy, but when the topic of infrastructure gets any attention without a tragedy, it is certainly a good thing.

By Robert Puentes

The Brookings Institution

Dear Governor Hickenlooper,

Those who follow transportation funding issues were disappointed last week by passage of the well intentioned but misguided SB 197 – a bill we respectfully request that you veto.

As the voice of many organizations and entities with interests in finding sustainable funding streams for our critical transportation infrastructure, Move Colorado supports aspects of the bill that protect the public’s interest by mandating public involvement and increased reporting to lawmakers on future Public Private Partnerships, or P3s. We oppose, however, the constraints on future P3s via onerous restrictions aimed at limiting a valuable tool from an ever-shrinking transportation funding toolbox. Weakening this tool, as this legislation does, effectively eliminates it – an outcome that we find untenable.

Having witnessed the process that was the catalyst for this bill, I’m confident that key issues will be addressed as new High Performance Transportation Enterprise (HPTE) projects move forward. The best parts of this legislation provide an exceptional roadmap to live up to lawmakers – and the public’s – expectations, and can be accomplished through executive order. The worst parts are just bad policy and deserve your veto.

Let’s give your Department of Transportation an opportunity to implement these principles before imposing unnecessarily narrow leeway on which to find innovative solutions to fund transportation infrastructure.

Sincerely,
Melissa Osse
Executive Director

To read the full letter, click here.