Yesterday, the Senate passed a two-year transportation bill by a vote of 74 to 22, putting us close to getting a reasonably good piece of legislation signed by March 31, when the current stopgap extension will expire. Last month, the House Natural Resources Committee approved a terrible bill that would have eliminated the current dedicated funding for public transportation, but House Speaker John Boehner (R-Ohio) has so far not brought it to the floor for a vote. The American Public Health Association and 15 other public-health groups wrote to Representatives urging a “no” vote on the House bill not only because it would strip out public transit funding but because it would eliminate dedicated money for the Safe Routes to School and Transportation Enhancements programs, which help communities support walking and bicycling.
Stephen Lee Davis of Transportation for America compares the two chambers’ bills point by point. He explains that the Senate bill preserves the dedication of 20% of federal gas tax revenue to public transportation, and allows some flexibility for spending the money on operations rather than new equipment. (Many transit systems have struggled to keep buses running as gas prices have risen and laid-off commuters have stayed home, so this flexibility will be welcome.) He also reports that the Senate bill consolidates programs for safer walking and biking and gives metro areas greater control in deciding which projects these funds should support. Ben Goldman of Streetsblog points out that greater local control might mean that some areas decline to fund bike or pedestrian improvements at all, though.
Thanks to an amendment from Senator Charles Schumer (D-NY), MAP-21 also restores parity between pre-tax employee benefits for transit and parking. At the end of 2011, the maximum amount employees could set aside tax-free for public transportation dropped from $230 per month to $125, while the maximum for parking rose from $230 to $240. (I wrote here about what this kind of savings can mean for commuters.)
That’s the fairly good news. Then there’s bad news.
Brad Plumer at Wonkblog explains that the Senate bill patches together money for the next two years, but doesn’t do anything to address the overarching difficulty of transportation money — not just for buses and trains, but for highways and bridges:
But what happens after those two years are up? It looks like the federal government will simply run out of money to fund the country’s transportation needs. The Highway Trust Fund, which is paid for by the federal gas tax, is rapidly dwindling. Americans are buying more fuel-efficient cars and driving less. And the 18.4-cents-per-gallon gas tax isn’t indexed to inflation. That means that, right now, there isn’t enough money to maintain transportation spending at current levels. The Senate bill, which passed on a 74-22 vote on Tuesday, had to resort to a bunch of side-measures to make up the shortfall. But the Senate could only stretch things out so far. When 2014 rolls around, the trust fund will be broke.
Here’s how the $109 billion Senate transportation bill will be paid for. The gas tax is set to raise $72 billion over the next two years, according to the Congressional Budget Office. That’s the biggest chunk of it. The bill would then also use future revenue over the next 10 years to fund current spending. That’s another big part of it. But there was a cost to all this gimmickry. According to the CBO, the Highway Trust Fund will be totally bankrupt by 2014.
And even then, there was still a $10 billion shortfall in the Senate bill. So they had to scrounge around for the rest. Some of the money, about $3.7 billion, came out of a separate trust fund intended to clean up leaking underground fuel tanks (which was originally paid for by part of the gas tax). Another $2.8 billion came from ending the tax deduction for “black liquor,” a byproduct of paper manufacturing. Another $743 million came from revoking passports for people who owe $50,000 in back taxes. The IRS was given more power to collect delinquent Medicare taxes and transfer some tariffs into the Highway Trust Fund.
It’ll be even harder to come up with this kind of additional revenue in 2014, but Plumer points out that there’s a straightforward solution: raise the gas tax, or at least index it to inflation. (Plumer notes that Senator Mike Enzi, R-WY, offered an amendment to index the tax to inflation, but it didn’t succeed.)
While now isn’t a great time for a tax increase, it’s the most sensible way to maintain our transportation infrastructure and systems, which are essential to all our lives. A predictable and gradual increase could also give people time to arrange their lives to require less gas consumption — setting up a carpool with co-workers, buying more fuel-efficient vehicles, figuring out how to use the local bus system, advocating for bike lanes in their neighborhoods, etc. More tax revenue for transit, bike, and pedestrian improvements can also make it easier for people to rely less heavily on their cars, which will make them less vulnerable to spikes in gas prices. As I’ve said before, I’m not saying everyone needs to give up their cars — I’m advocating for more transportation options, so those who’d rather not drive in every situation don’t have to. Fewer cars on the road means cleaner air and less congestion for all, and walking and biking are good ways to get exercise. We need transportation legislation that moves us toward a less driving-centric future; for now, the Senate bill at least avoids taking us backwards.