Congress stares down deadline to save highway funding

Congress has until July 31 to figure out how to keep the nation's highway trust fund from going belly-up.

So far, the U.S. House and Senate have had some success with figuring out how to spend the money -- but less so in figuring out the source of that funding. The Highway Trust Fund, its coffers filled by a gasoline tax that hasn't increased since 1993, passed the point of solvency in 2008. Congress has opted for a series of stopgap measures since then, the latest expiring at the end of next month.

If there's no agreement and the fund lapses, summer construction projects could screech to a halt across the nation. And without a long-term agreement, it's going to be a tough road to completion for major bridge projects across Alaska.

A fifth of Alaska's major roads are already in poor condition, and the state has the ninth worst rural roads in the country, according to a report released in May by TRIP, a transportation research group. According to the Senate Environment and Public Works Committee, Alaska currently has 153 structurally deficient bridges, and 23 percent of the state's bridges are either structurally deficient or "functionally obsolete."

It's a problem for transporting goods -- 44 percent of the $18 billion in commodities delivered in Alaska each year travel by highway, according to TRIP.

And without a long-term plan for the highway fund, there's little chance for the $1.6 billion Knik Arm Crossing, which would connect Anchorage to the Matanuska-Susitna Borough, or improvements to the Glenn Highway to relieve building congestion, according to the committee.

The Senate Environment & Public Works Committee took a big leap forward in efforts to manage the Highway Trust Fund on Wednesday, passing a bill out of the committee that would authorize funding for six years. Other provisions of the bill aim to limit bureaucratic hurdles that can cause long delays for highway projects and offer the state a chance for long-term planning.


If the Senate's six-year authorization goes through, funds would go up 3 percent a year for six years, for about $265 billion over the stretch. Alaska would get more than half a billion dollars in fiscal year 2016 alone. In the last fiscal year, Alaska received $484 million in federal funds for highways, according to the Department of Transportation.

Sen. Dan Sullivan, who sits on the Environment and Public Works Committee, touted the bill's plans to boost funding for tribal transportation by $10 million a year, and federal lands transportation and access program funding by $5 million a year each. The bill would also ease some requirements of some EPA air pollution rules for some parts of Alaska and allow for land exchanges between the state and the U.S. Forest Service that have been hamstrung by legal ambiguities.

But the authorization isn't enough: Congress has to figure out a way to pay for it.

For years, the highway fund has fallen short and lawmakers have been moving money around instead of dealing directly with the shortfall. The fund is meant to be a straightforward "user fee" -- an 18-cent tax per gallon of gasoline.

But the gas tax hasn't gone up since 1993 and hasn't kept up with inflation. The tax has about a third of the purchasing power it had 21 years ago. Meanwhile, more fuel-efficient vehicles have carved into the overall take.

Rep. Don Young, R-Alaska, championed a plan to double the gas tax more than 10 years ago as then-chair of the House Transportation & Infrastructure Committee, to the chagrin of some in his party.

For now, enough lawmakers are hesitant about raising the gas tax that it's largely off the table. But they've continually fallen short on finding a new way to pay for the nation's roads and bridges.

Since 2008, Congress has been executing a series of transfers from the general fund to make up the $63 billion shortfall. It would take $11 billion out of the general fund to keep funding level over the next year, according to the Congressional Budget Office.

For the 2015 fiscal year, for example, highway and transit spending will hit $52 billion, but revenues in the highway fund will reach only $39 billion, according to testimony by Joseph Kile of the Congressional Budget Office. The Transportation Department would be late paying its bills.

And it's hardly enough, many lawmakers argue. Nationwide, there's a nearly trillion-dollar backlog in highway and interstate funding. The highway fund pays for about 25 percent of road and bridge building, largely through grants to states.

One option under consideration -- but hitting a lot of roadblocks -- is a corporate tax holiday for money that corporations have stashed overseas. A temporary tax cut would theoretically draw companies to bring that money back to the U.S., and those funds would go to repairing roads and bridges.

The plan is favored by the Obama administration and many Republican lawmakers, though there's broad skepticism about how effective it would be, and nobody sees it as a long-term solution.

Despite partisan disagreements, "virtually everyone in Congress agrees that we need to get to the point where we are no longer facing a highway cliff every few months," Sen. Orrin Hatch, R-Utah and chair of the Senate Finance Committee, said at a hearing last week.

Everyone wants a six-year highway bill that at least holds the current $92 billion spending bill, he said. "You don't find that kind of money by sifting through the cushions of your couch."

Ranking member of the finance committee Sen. Ron Wyden, D-Oregon, said "the way Congress has limped from one short-term funding patch to the next more than 30 times is unquestionably a little-league strategy" and argued for increased spending and a long-term plan.

They have three options, Kile said: cut infrastructure spending, find a new revenue stream or just keep scooting money from the general fund, to the detriment of the overall budget.

Air traffic control can't keep pace with demand and air travel congestion is "approaching gridlock," former Transportation Secretary Ray LaHood told a Senate panel last week. "America needs a strategic plan with a vision -- not another short-term bill that isn't even enough to keep filling the potholes."


Not everyone is on board with more spending -- the conservative Heritage Foundation has told Congress to pare back spending instead, making sure that all the funds are spent on roads and bridges, not side projects.

While this fight rages on, Congress is busy trying to craft appropriations bills to set a 2016 budget. On Thursday, the Senate Appropriations Committee will review a bill to fund transportation agencies and the highway fund for fiscal year 2016.

They plan to hand the DOT $17.8 billion for the year, parcel out $500 million for "TIGER" infrastructure grants and send $16 billion to the Federal Aviation Administration, among other programs.

That bill also sets a budget of $40.3 billion for the highway fund. But unless there's a new authorization bill passed, there's no funding. And unless there's a new plan for where the money comes from, there's still no funding.

Erica Martinson

Erica Martinson is Alaska Dispatch News' Washington, DC reporter, and she covers the legislation, regulation and litigation that impact the Last Frontier.  Erica came to ADN after years as a reporter covering energy at POLITICO. Before that, she covered environmental policy at a DC trade publication and worked at several New York dailies.