Publisher's Note: Jim Bispo's column appears in the Beaufort Observer.
Well whadda ya know??
The highway trust fund is running out of money and we need to do something to get the funding back up to a point where we will be able to maintain our Interstate highway system.
What do you suppose happened to cause this. We are told that the ever increasing improvements in mileage being experienced in our automobile fleet have resulted in significant decreases in the amount of (federal) gas tax being collected and that is the reason for the shortfall. I suppose we could easily solve the funding problem if we would simply mandate that all vehicles revert back to fewer miles per gallon... Nah...
There are all manner of really interesting sounding options being surfaced. We could convert the Interstate system to toll roads - either all at once or piecemeal - depending on a State's needs. We could increase the gas tax rates. We could tax vehicles based on the number of miles driven - which ostensibly preserves the "user pays", notion of highway funding (which the per gallon tax was originally intended to do). That would keep the electrics, hybrids, etc. from getting a "free" rides as is now the case. I suppose we could charge by the KWH used to charge the batteries of the electrics (and partial electrics)
If you look at Federal Highway Administration (FHWA) motor fuel taxes you will discover that the federal tax on gasoline is 18.4 ˘ per gallon. You will also see that gasohol (10% blend which seems to be the amount shown on virtually every gas pump in the countryside) is never-the-less taxed at only 13˘ per gallon. Gasohol, which reportedly takes more energy to produce than it saves enjoys a 5.4˘ per gallon tax advantage over gasoline. This on top of the direct subsidies paid to the corn producers and gasohol distillers, all of which conspire to increase the cost of our corn based breakfast cereal and everything else based on corn. Diesel fuel gets hit for 24.4˘ per gallon
We all know that anyone who owns a truck (a big one) should be made able to pay some fairly significant "highway taxes". After all, they are such a nuisance when we must deal with them on the highway. So we charge them a fairly high tax on their tires. We charge a 12% sales tax for trucks over 33000 pounds Gross Vehicle Weight (GVW) and trailers over 26,000 pounds GVW. And then we lay a recurring annual tax on them as well. There's more..
The whole highway trust find conversation sounds remarkably like the conversation we hear when we talk about the Social Security and Medicare Trust Funds. Only the names have been changed. (To protect the innocents?? Probably not. It is not at all clear is that there are many 'innocents" who have been involved with any of these Trust Funds - other than the innocent lambs who have paid into them..)
What we seldom seem to focus on is how we got to where we got to and where the Highway Trust Fund money goes.
The first tax on gasoline was imposed in 1932. The "gas tax" as we know it (the Highway Trust Fund) was enacted in 1956. It's purpose was to provide for the long term funding of the interstate highway program. The Federal Highway Act of 1956 was intended to be self financing. The Highway revenue Act of 1956 was included as Title II. The broad notion was that those who use the system should be the ones who pay for it. Not such a bad idea.
But then, guess what...
Congress in its infinite wisdom decreed in 1982 that some of the Highway Trust funds should be allocated to Mass Transit. And then in 1986 Congress established the Leaking Underground Storage Tank Trust Fund and funded it with gas tax money.
In 1990 Congress increased the gas tax by five cents - from nine to fourteen cents per gallon. This time they handed half or the increase to the General fund - specifically earmarked for deficit reduction. The other half went to the Highway trust fund with a small part earmarked for mass transit.
Please note that there is a difference between debt reduction and deficit reduction. Debt is the amount we owe. Deficit is the amount by which annual expenditures exceed annual income. So what surely sounded like a good thing to a lot of folks was really no more than sleight of hand.
In 1991 the Intermodal Surface Transportation Efficiency Act extended the "gas tax" as well as a number of excise taxes that were part of the Trust Fund funding picture. The act allowed the states increased latitude on the types of things they could spend their share of the Trust Fund money on and specifically added a new Trust Fund (another one) called the National Recreational Trails Trust Fund.
For the two year period beginning in1993 he amount of "gas tax" sent to the general fund for "deficit reduction" rose to 6.8 cents per gallon.
In 1997 the tax rose to 18.4 cents per gallon which remains in effect today.
In a 6/30/2009 GAO report, we are told that for the period of 2004 - 2008 the DOT had total authorizations of $243.1B Highway Trust Fund (HTF) money of which some $78B was used for
purposes other than construction and maintenance of highways and bridges. There is no reason to believe that the amount of HTF money siphoned off for extraneous activities has changed appreciably (other than, perhaps, to go up). It's no wonder the so called Trust Fund is coming up short of money. To read the report,
click here.
Oh yeah - and how do you suppose the State of Hawaii found itself with Interstate highway funds to build the H-1, H-2, and H-3 interstate highways on the island of Oahu. In case you were wondering, "Interstate", means between states. In Hawaii what they have are Intrastate Highways built with Interstate highway money. Thanks., "Senator Dan" (RIP).
If you are interested in the routes of these three Interstates (well, that's what they call them),
click on to see the H-1 route;, and then:
http://en.wikipedia.org/wiki/File:Interstate_H1_map.png to see the H-1 route;
http://en.wikipedia.org/wiki/File:Interstate_H2_map.png to see the H-2 route; and
http://en.wikipedia.org/wiki/File:Interstate_H3_map.png to see the H-3 route. All courtesy of Wikipedia.
We hear that the Medicare Trust Fund is likely to last until about the middle 30s; the Social Security Trust fund until about the mid 20s; and the Highway Trust Fund already needs a large infusion of new money now to keep it alive. What do you suppose it is about "Trust Funds" that make them so susceptible to abuse??
Clearly "robbing" the Highway Trust Fund is a non-partisan activity. It happens under both Rep and Dem Administrations. But that does not make it acceptable... Regardless who does it, it is a downright outrage!!
What is also clear is that if we don't wise up soon and put TRUST back into our Trust Funds, there won't be any left. It is well past time that the Congress needs to begin to demonstrate some honesty and integrity. Maybe we could enlist the help of Diogenes to find an honest man (or woman) in congress to oversee any new Trust Funds. Either that, or quit scamming the long suffering taxpayers by establishing any more "Trust Funds". No comment about the likelihood of either one of those things happening any time soon...
D'ya think??
