Transportation infrastructure: DOT’s LaHood calls for immediate 18-month highway reauthorization bill

With the Highway Trust Fund again facing the prospect of running out of money, Department of Transportation Secretary Ray LaHood called on Congress to propose an immediate 18-month highway reauthorization bill that would replenish the Highway Trust Fund (HTF).

The HTF is the federal government’s primary source for financing highway, bridge, and transit projects, and it is largely funded by the motor fuel federal tax, which is 18.4 cents per gallon for gasoline and 24.4 cents for diesel and has not been raised since 1993. One main reason for the HTF’s dwindling financial resources is that Americans are driving fewer miles, as evidenced by Americans driving 90 million fewer miles year-over-year in fiscal 2008. Many industry stakeholders maintain that raising the motor fuel federal tax is long overdue, but Department of Transportation Secretary Ray LaHood has said repeatedly that raising the tax is not under consideration.

LaHood said if the step for this 18-month highway reauthorization bill is not taken, the HTF could be insolvent by the end of August, with states facing the prospect of losing key transportation funding. LaHood’s plan follows news from earlier this month indicating that the HTF needs up to $7 billion through the remainder of 2009.

“I recognize that there will be concerns raised about this approach,” LaHood said in a statement. “However, with the reality of our fiscal environment and the critical demand to address our infrastructure investments in a smarter, more focused approach, we should not rush legislation. We should work together on a full reauthorization that best meets the demands of the country. The first step is making sure that the Highway Trust Fund is solvent. The next step is addressing our transportation priorities over the long term.”