Federal funding for highway construction is quickly coming to a crisis point. According to the U.S. Department of Transportation, the Highway Trust Fund (HTF) will run out by September unless Congress takes action. If left unchecked, no money will be left to meet federal highway spending obligations.
Highway Trust Fund Will Go Broke in Mid-August 2014
As of mid-January, about $8.5 billion remained in the fund — and this was only after an infusion last October of $9.7 billion transferred from the U.S. government’s general funds. With more money going out than coming in, another funding infusion will likely be needed to forestall bankrupting the HTF.
Clearly, a long-term solution is sorely overdue. There have been many suggestions bandied about to forestall future revenue shortfalls. So far, none have gained the necessary traction in Congress to ensure consideration, let alone passage, once negotiations for reauthorization of federal highway legislation (MAP-21) begin this year. Without a viable plan in place, the HTF will continue to struggle to be self-sustaining, threatening the availability of funding for future transportation construction activities.
Of course, the issue goes beyond revenue generation; there is also a need to better manage how the funds are being spent. In a January 15th speech to the Transportation Research Board Annual Meeting, U.S. Secretary of Transportation Anthony Foxx stressed the importance of “identifying ways for the department to use innovation and improved planning to stretch transportation dollars as effectively and efficiently as possible” (“DC: U.S. Transportation Secretary Anthony Foxx Outlines Transportation Vision Focused on Overcoming Infrastructure Deficit”, www.MassTransitmag.com). He emphasized the need to develop cost-saving best practices that can deliver the same amount of infrastructure for less, and encouraged representatives from the various modes of transportation to work together on a national transportation plan.
Foxx also highlighted the importance of transparency and accountability for federal highway spending by announcing the department’s intention to post monthly updates on its website of the remaining balance in the HTF (www.fhwa.dot.gov/highwaytrustfund).
With the HTF default and highway bill reauthorization looming, there is much work to be done to identify and put in place the necessary steps to not only maintain but grow the U.S. transportation system. On the macro level, this will require legislators and transportation representatives to come together to identify solutions that work — no easy feat given the current political environment. On a more micro level, it calls for continued pressure on state and federal legislators from professionals in the transportation sector, along with a willingness to join together as an industry to develop and encourage innovation and identify best practices that can ensure transportation funds are stretched as far as they can go.
