A New Political Reality Settling in for National Transportation Financing

» Austerity measures that may be introduced in the House could result in significant cutbacks in support for transit. Meanwhile, the decision by Republican legislators to phase out earmarks may reduce support for a future transportation bill.

Tanya Snyder of Streetsblog Capitol Hill broke the news last Friday that House Republicans are planning to push to “stabilize” the Highway Trust Fund by cutting back expenditures to meet revenues without raising any taxes in the process. The result would be a large decrease in overall federal transportation funding — a potential reduction in spending by $7 to 8 billion a year from around $50 billion today. According to Snyder’s sources, transit financing would be hit especially hard, seeing its annual appropriation cut from $8 billion to $5 billion.

This proposal, though it has yet to be announced publicly (and, indeed, it may not represent the eventual thinking of the House Republican leadership) and though it would likely fail to pass through the Senate, nevertheless adds another layer of difficulty to the already almost impossible process of creating a new national transportation bill.

To make matters even more complicated, Republican members in both houses of Congress followed through last week on their commitment to eliminate their demands for earmarks, a move that will reduce the support of individual members for transportation spending in general. 2011 is likely to shape up as a wild ride in the annals of highway and transit funding.

What was never really in question was the fact that a temporary extension of current federal spending on transportation was coming soon, the fault of a Congress that has for two years been unwilling to step forward in support of improved financing mechanisms for transportation. Departing Chairman of the House Transportation and Infrastructure Committee Jim Oberstar (D-MN) recently called for a year-long extension; likely new Chairman John Mica (R-FL) has suggested he would support a six-month lengthening of the current law. No one is clamoring for an immediate shut-down in spending on popular road works. The Highway Trust Fund, filled by fuel taxes, has lacked adequate revenues to pay for all of the highway and transit construction the U.S. has undertaken over the last two years — and even that is just half of what some experts argue is necessary for the adequate maintenance of the nation’s mobility infrastructure.

The Republican proposal as suggested by Streetblog’s Snyder would simply limit spending to what the Highway Trust Fund can raise through the existing federal 18.4¢ gas tax, eliminating the possibility of transferring “general,” income tax-sourced revenues to transportation. But the results of that policy would be devastating; not only has the revenue source not been adjusted to inflation since 1993 — meaning that its value has steadily declined — but people are increasingly driving less and replacing their vehicles with more fuel-efficient cars. The overall effect is a loss in infrastructure-building funding.

Democrats, who despite losing control over the House of Representatives remain in power at the Senate, are unlikely to follow through with these efforts to reduce federal spending on transportation, at least considering their collectively pro-investment stance over the past few years. No one, however, seems to have any courage to propose funding transportation by any manner other than through general fund transfers (such as raising the gas tax), and so if Republicans mount opposition to the idea, the whole program could be put into question.*

GOP members have been arguing for months that a huge percentage of spending at the federal level is waste, an argument that is appealing to a frustrated public experiencing the continued negative effects of a long recession. Thus an attempt to keep transportation spending in check may sound reasonable. As does, apparently, the ban on earmarks, which many Republicans and some Democrats argue are equivalent to political advertisements in which an influential congressperson or senator inserts language in a bill benefiting some minor and unimportant project purely because he or she hopes his or her constituents will notice the work being done for their district.

But earmarks have played an important role in producing bipartisan support for transportation bills in the past. As Robert Puentes recently noted, in the last bill passed in 2005 (SAFETEA-LU), there were 6,373 earmarks distributed pretty evenly across the nation thanks to “contributions” from a number of legislators involved in the bill’s writing. The bill was supported by 412 House members, compared to 8 who voted against it; In the Senate, there were only 4 opponents of the bill (mostly opponents of earmarks), compared to 91 proponents. By giving each member of Congress a local reward for the bill, the program becomes virtually universally supported, no matter the specifics of most of the legislation’s language. It may have been coercion, but it resulted in a funded national transportation system. What would happen now?

One solution, suggested by the generally deluded Congresswoman Michele Bachmann (R-MN), is to allow earmarks that are related to transportation, since those are, according to her, not wasteful. This in spite of the fact that much of the issue over earmarks was spurred on by the absurdities of the Alaskan “Bridge to Nowhere.” And despite the fact that earmarks make up a very small proportion of overall federal spending on transportation, so bringing them back into the equation wouldn’t help matters much.

A long-term solution to these political disagreements is for now not clear. An extension in federal spending for transportation over the next month is likely, but thereafter, all bets are off.

* A spokesman for Senator Tom Carper (D-DE) contacted me after first publishing this article. He made the very good point that the Senator and Senator George Voinovich (R-OH) proposed a plan three weeks ago to increase the gas tax by 25¢ over the next three years, and that the deficit commission appointed by President Obama had itself suggested a 15¢ rise earlier this month. I should note, however, that neither of these proposals have widespread support from the Congress as a whole.