Infrastructure Triage: Fix the Bottlenecks
Our nation’s economy relies on the continuous and efficient movement of goods and people, but the current condition of our nation’s infrastructure puts that at risk. The American Society of Civil Engineers gave America’s infrastructure a D+ on its 2017 report card. Among the recipients of the lowest marks were the nation’s highways, which the report described as “often crowded, frequently in poor condition, chronically underfunded, and are becoming more dangerous.”
For decades, we have relied on the Highway Trust Fund, which is funded primarily by the federal fuel tax, to help repair and maintain our nation’s roads and bridges. But the federal fuel tax has remained flat since 1993 and has been unable to keep pace with demands. By 2020, the Highway Trust Fund — originally intended to be a sustainable revenue source financed by users of the system — will be insolvent. And despite attempts to make up the shortfall, the fund is running on fumes today. Consequently, we must find other ways to increase revenues must be found. Estimates show that in addition to current projected user fee revenue, the U.S. will need about $25 billion annually to avoid reductions in highway, transit, and safety investments.
Crumbling roads impact everyone. Setting aside the considerable safety concerns, the average motorist in the U.S. is losing $1,483 annually due to roads that are congested or in disrepair. More specifically, we are paying $523 annually — $112 billion nationally — in additional vehicle operating costs as a result of driving on crumbling roads. Lost time due to congestion amounts to an average of $960 annually. These costs could go down exponentially with modest investment in infrastructure improvement.
Our economic prosperity relies on commerce and a reliable freight transportation system. The trucking industry is at the heart of our supply chain, moving 70 percent of the country’s freight, amounting to $10 trillion. Trucking is a vital connection to job growth and economic prosperity.
Earlier this year, the American Transportation Research Institute released its annual list highlighting the 250 most congested bottlenecks for trucks in America. The study assesses the level of truck-oriented congestion at 250 locations on the national highway system.
If President Trump and Congress want to get the greatest bang for their buck, they should focus on fixing the these bottlenecks, which are choking transportation efficiency and productivity, while providing additional revenue to maintain the entire system at acceptable levels.
A focused effort on fixing bottlenecks will yield optimal return. A reliable and uncongested highway system is a strategic asset, whereas a poorly maintained system is a strategic liability that will hold back any progress made through tax or regulatory reform.
There are several paths to raise the needed funding for infrastructure. The most fair and efficient is to increase and index the fuel tax. Doing so would involve no additional administrative costs. It would be generally tied to highway use and be low cost to consumers. Light-duty vehicles would see an annual increase of around $48 to $71.
Other solutions could include public-private partnerships or dedicating tax revenue from the offshore accounts of U.S. corporations to infrastructure. (Loosening restrictions on tolling existing interstates is a non-starter and would be a poison pill for the trucking industry as well as other highway users.) But a modest increase in the fuel tax is the fairest, most sustainable way to address highway investment needs for the foreseeable future.
Funding our highway infrastructure is no easy task. But lawmakers should look upon it as an investment. Ensuring a safe and efficient freight transportation system is indispensable for our growing manufacturing and natural resources sectors as well as American jobs.
Chris Spear is President and CEO of American Trucking Associations.