Photo by RW PhotoBug on Flickr.
A new bill in the House of Representatives proposes eliminating the federal gas tax and making states pay for roads and transit themselves. Would that be good or bad for transportation?
The Transportation Empowerment Act (TEA), by Senator Mike Lee (R-Utah) and Representative Tom Graves (R-Georgia), would virtually eliminate the federal gasoline tax over a 5-year period and devolve the responsibility of funding roads and transit to the states. It now has 19 co-sponsors in the House. We asked a few contributors to give their thoughts on how it could affect transportation funding.
David Cranor: This could be made workable. First, we could devolve gas taxes to states. Then, we could take the general funds used to enhance state funding to pay for Transportation Enhancements, recreation trails, Amtrak, TIGER, and so on.
The upside is that it gets rid of all the belly-aching and actually means less money for roads, unless states raise their gas taxes. The downside is that it reduces political support for non-car transportation.
David Edmondson: If the federal government cuts the gas tax and its investments in transportation, this would undoubtedly be bad for transit and non-car modes of transportation. But there may be a silver lining.
Despite the best efforts of advocates, federal transportation dollars overwhelmingly favor roadway projects, and most of those are highways or overbuilt arterials. And, given that these are often capital projects, the end result is high maintenance costs on localities that wouldn’t have built the project in the first place if the money weren’t “free” from the feds.
If states raise their own gas tax to match the loss, they’d be able to use that money how they see fit. A whole slew of federal strings would come off, freeing states to make the decisions they think they ought. While that might mean more questionable interchanges in Wisconsin, that state will actually need to pay for them entirely.
Advocates’ fear that states won’t raise their gas tax are certainly valid, of course. The tax discourages driving and was designed to fund infrastructure of national importance. Eliminating it would cut the federal government’s ability to do either of those things. Yet the chance to cut all the bloat and waste advocates fight against and this money encourages would be quite a silver lining.
Matt Johnson: In Georgia, Graves’ home state, the state constitution expressly prohibits the expenditure of gasoline tax revenues on anything other than roads, so without federal money, the Peach State would essentially only invest in highways. That’s actually not a huge change.
MARTA, which operates rail, bus, and paratransit in Fulton and DeKalb counties is the largest transit agency in the country that receives no funding from the state government. Of course, MARTA was able to build their rail system using local and federal funds. But without the federal share, it would have been impossible.
Which is probably what Graves and Lee want. After all, the GOP has long suggested that investing in transit is a wasteful subsidy, while investing in roads is a sound investment for economic development.
According to Senator Lee, “Under the Transportation Empowerment Act, Americans would no longer have to send significant gas-tax revenue to Washington, where sticky-fingered politicians, bureaucrats, and lobbyists take their cut before sending it back with strings attached.” [emphasis added]
Of course, this isn’t accurate. According to a Government Accountability Office report from September 2011, both Georgia and Utah are winners in the transportation dollar lottery. Both states got $1.10 back in federal transportation dollars for every $1.00 they sent to Washington between 2005 and 2009.
Of course, they’re no different from the other 48 states. But wait a minute: aren’t there winners and losers? Doesn’t at least one state have to be a donor state?
No. Because Washington doesn’t just allocate gas tax revenues. They also send general fund revenues off to transportation projects.
So not only are those sticky-fingered lobbyists not stealing from Georgians to fund highway projects in Yankeeland, but the federal government is actually gifting Georgians (and Utahans) a little extra money on the side. Or to translate that into GOP-speak, “it smacks of socialism.”
The idea, of course, is to just let the states take over and use a more locally-focused approach that works best for them. Federalism and all that.
But anyone want to put the odds on whether a state like Georgia would actually raise their own gas tax to compensate? Yeah, I didn’t think so.
The real goal is of course, to stop spending money on transportation altogether. But that’s okay. It’s DOA in the Senate.
Canaan Merchant: Any transportation project is going to try to combine its funding from all levels of government. This bill is just the latest example of trying to come up with a standard across a large country with a very diverse population and large number of situations that require specific and different solutions.
Yonah Freemark of the Transport Politic has considered the question as well. He argues that the basic scheme where the federal government provides funding for construction while states and cities pay for operations and maintenance is backward.
Local governments may benefit from being able to not have to compete against dozens of other projects for federal funding while the federal government can ensure that service doesn’t take a dive in lean budget years for localities.
Now that may not be optimal in the end, but it may be beneficial to completely reconsider how and who funds transportation projects across the country.