Highway and Transportation Funding Act of 2014 (sequel)

htfWhile the best-case scenario is a longer-term fix, this bill keeps jobs in place and gives Congress time to work on what the country really needs: a long-term plan to care for our roads and infrastructure.–Rep. Tom Reed

Heritage Action, in the unsigned article dated July 14, 2014 which is cited below, writes:

An inability to control spending combined with costly regulations that inflate the cost of projects has rendered the HTF (Highway Trust Fund) model functionally obsolete.  With each bailout, the link between highway spending and gas taxes is degraded, making it increasingly difficult to enact structural reforms that turn over the federal highway and transit programs to the states, so they can manage their transportation needs without Washington bureaucrats.

Here are the key points from the above paragraph:

  1. costly regulations that inflate the cost of projects has rendered the HTF model functionally obsolete.  
  2. the link between highway spending and gas taxes is degraded,
  3. structural reforms that turn over the federal highway and transit programs to the states, so they can manage their transportation needs…

Are they reasonable?

What costly regulations? What would be the cost of repealing health and safety regulations, environmental regulations? One costly regulation may be the Davis-Bacon Act which requires Federal Contractors to pay fair wages. If that were repealed, it would shift the cost of projects from taxpayers to construction workers–there is no justice in that. Rep. Reed, to his credit, voted this year to reaffirm the Davis-Bacon Act.

gas tax graph

Blue line reflects inflation

The HTF model pays highway cost with gas taxes. Due primarily to inflation, gas taxes no longer provide the needed funds. This model might indeed be obsolete if taxes cannot or should not be raised enough to provide needed revenue. However, there is no reason to link highway costs with gas tax revenue–it is quite reasonable that other sources of revenue might be tapped. Indeed this would weaken the link between highway spending and gas taxes, but why should we care?

  1. Gas taxes are regressive–the poor spend a higher percentage of income on transportation than the rich.
  2. Gas taxes may make working a far-from-home job uneconomical.

In favor of gas taxes is the negative impact on consumption, and the fact that citizens may view the gas tax as a fair way to pay for highways.

The idea of turning responsibility for interstate highways to the states seems silly

  1. We need national standards.
  2. We need interstate highways.

Many remember well what travel was like prior to the construction of the first highways of the interstate system; they would never wish to go back to that.

© William Hungerford – September 2014

http://heritageaction.com/key-votes/highway-transportation-funding-act-2014-h-r-5021/

http://www.washingtonpost.com/local/trafficandcommuting/bump-at-the-pump-senators-propose-a-12-cent-hike-in-federal-gas-tax/2014/06/18/0eb5b4b2-f702-11e3-a606-946fd632f9f1_story.html

https://newny23rd.com/2014/09/06/highway-and-transportation-funding-act-of-2014/

 

 

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About whungerford

* Contributor at NewNY23rd.com where we discuss the politics, economics, and events of the New New York 23rd Congressional District (Allegany, Cattaraugus, Chautauqua, Chemung, (Eastern) Ontario, Schuyler, Seneca, Steuben,Tioga, Tompkins, and Yates Counties) Please visit and comment on whatever strikes your fancy.
This entry was posted in Congress, Economics, Environmental, Political, Reed's Views and tagged , , , . Bookmark the permalink.

2 Responses to Highway and Transportation Funding Act of 2014 (sequel)

  1. Maureen A. Harding, AICP says:

    From a Transportation Professional who works with the State, I say Bravo William Hingerford, Bravo.

  2. Oops—Hungerford—fat fingers on my phone.

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