Resources to Fund National Goals

Existing barriers to state and metropolitan regional flexibility and innovation should be reduced

By Emil Frankel

This post was originally published on National Journal‘s Transportation Experts Blog. You can read the full forum here.

The on-going saga of passing legislation to authorize federal surface transportation programs — legislation that is now more than two-and-a-half years overdue — reminds us that two overriding public policy issues are intertwined: first, the scope of the national interest in surface transportation; and, second, the manner and level of the appropriate sources of revenue to support such a clearly defined federal program.

Although rarely noted, one of the most important points made in the excellent report of the National Surface Transportation Infrastructure Financing Commission (the Financing Commission), issued in early 2009, was that the level of federal gasoline tax increase to be recommended depended upon the scope of the national highway system (and other key national transportation interests) that had to be supported by federally-generated transportation-related revenues.

As the Bipartisan Policy Center (BPC), two national commissions, and a multitude of organizations and groups have repeatedly noted over the last few years, the United States is not investing enough in its transportation infrastructure and networks. There is a growing gap between now-available resources and the investment capital necessary to bring aging, deteriorating, and congested facilities to conditions of good repair.

Redefining the national interest in surface transportation and adopting fundamental reforms to federal programs are inextricably linked to, and arguably should precede, determining how much federal money should be invested in the achievement of those goals and in establishing how best to raise the related federal revenues. It should be emphasized that the task of redefining the national interest in surface transportation and of identifying the character and extent of federal revenues to support those purposes is both more difficult and more urgent in the context of the nation’s fiscal crisis, persistent annual budget deficits, and the escalating national debt.

The Senate-passed surface transportation authorization bill, MAP-21, has made an important start, in proposing significant reforms to federal programs. However, the shape of a final bill, if any, is still unclear, as no clear consensus has yet emerged in the House of Representatives on the scope of, and resources for, a national surface transportation program.

As BPC has consistently noted, we must first define national goals and federal interests in surface transportation. These goals and purposes are likely to be somewhat different from, and could perhaps be more narrow than, such goals and interests in the 1950s, when the Interstate Highway Program was authorized, and even from 1991, when ISTEA was enacted. It remains BPC’s view that the federal revenues dedicated to the achievement of these clearly defined goals should be user-based (but we recognize that some others may have different views on that subject) and that these federal revenues should be adequate to assure a sufficient and appropriate level of federal investment in the pursuit of national purposes, as defined by Congress.

Moreover, as BPC has urged and as Bob Poole has noted in his response to this question, there is bound to be a greater role for states and metropolitan regions, in surface transportation investment. To that end, existing federal barriers to state and metropolitan regional flexibility and innovation, in raising investment capital and in generating revenues, should be reduced, if not totally eliminated.

Unless and until Congress articulates national goals and interests in the surface transportation authorization bill that it is now considering, it seems unlikely that it will be able to determine the sources of federal revenue to support those purposes or the level of appropriate funding. I remain hopeful that Congress will, at least, take these essential first steps toward articulating and reforming national surface transportation policy.

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