Highway Trust Fund Tax Receipts Rebound in July, Extension Likely

The good news is revenue rebounded to slightly above July 2019 levels. That is coupled with some bad news that instead of a permanent HTF revenue solution, a highway and transit funding program extension is increasingly likely.

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The U.S. Treasury Department published the monthly report of Highway Trust Fund (HTF) tax receipts for July 2020. Revenue from the federal excise taxes on motor fuels and trucking rebounded to slightly above July 2019 levels. 

July 2020 HTF net tax receipts totaled $3.84 billion, which is $201 million above the July 2019 level. All five of the HTF's excise taxes – including the 12 percent sales tax on new heavy trucks and trailers – were up from July 2019 levels. 

While this is good news for highway and road construction funding, there is an increasing likelihood that a highway and transit funding program extension is likely.

With less than 40 days until the Sept. 30 expiration of the FAST Act law, election season peaking, and Congress bogged down with the latest COVID-19 relief measure, congress and the president will most likely extend the surface transportation program, just as they have done more than a dozen times since 2009.

The American Roads and Transportation Builders Association (ARTBA), along with other industry associations have prioritized the importance of increasing core federal highway and transit investment beyond current funding levels, which both the full House of Representatives and the Senate Environment and Public Works Committee have approved on a bipartisan basis.

"Noting past negative market and economic impacts of extension-related flat funding levels, coupled with new uncertainty about the timeline for the nation’s post-coronavirus economic recovery, ARTBA raised serious concerns about a status quo approach," Dean Franks, senior vice president for congressional relations, at ARTBA said. "ARTBA also reminded the staff that increased funding in an extension will require additional HTF resources."

An extension notwithstanding, the industry remains focused in its pursuit of a permanent HTF revenue solution and enactment of other legislation that would significantly increase surface transportation investment.