Highway Trust Fund Hearing – CBO Estimates 100 Percent Cut in 2015

On Tuesday, the House Transportation and Infrastructure Subcommittee on Highways and Transit held a hearing on the fiscal condition of the Highway Trust Fund (HTF).  The subcommittee heard testimony from Polly Trottenberg, undersecretary for policy at the U.S. Department of Transportation (DOT) and Kim Cawley with the Congressional Budget Office (CBO).  In Cawley’s testimony, CBO provided a dire warning about what will happen to federal highway and transit programs dependent on Highway Trust Fund revenue – they will receive no new money.  While Ms. Trottenberg offered no new solutions to the problems facing the trust fund, she instead continued to push for President Obama’s idea to take a piece of the savings from the drawdown from the wars in Iraq and Afghanistan (an idea that has very little chance of happening).  The members of the subcommittee were told by CBO that unless Congress addresses the fact that the Highway Trust Fund is going broke, sometime soon after the expiration of MAP-21 in September 2014, the HTF will not have enough money to meet all of its obligations.  CBO went on to testify that the fund will need an additional $15 billion in FY 2015, with that number growing in subsequent years.  It was suggested that Congress could address the projected annual shortfalls by substantially reducing spending for surface transportation programs by boosting revenues, or by adopting some combination of the two approaches. Balancing the trust fund by 2015 would require an appropriations funding level nearly equal to the $51 billion authorized for FY 2015, raising the taxes on motor fuels by about 10 cents per gallon, or undertaking some combination of those approaches. While not completely disagreeing with CBO, DOT offered no solutions to the problem; rather an acknowledgment of the situation. The solvency of the Highway Trust Fund remains a top priority for AGC. We are currently in the process of educating Representatives and Senators about the pending HTF crisis and the need to act sooner rather than later.  As the House and Senate craft a comprehensive tax reform package, AGC is encouraging the Highway Trust Fund revenue gap to be addressed in any final package.  For more information and to contact your elected official, visit AGC’s Legislative Action Center. For more information, please contact Sean O’Neill at (202) 547-8892 or oneills@agc.org.