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| AASHTO Press
Release |
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Sunny Mays
Schust
(202)
624-5800
Friday, January
18, 2002 04:31 PM |
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| Highway Funding Could Plunge by $9
Billion; AASHTO Questions Analysis |
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Highway Funding Could Plunge by $9 Billion;
AASHTO Questions Analysis
Federal highway funds could plunge by more
than $9 billion next year as a result of a new U.S. Treasury
analysis of fuel tax receipts into the Highway Trust Fund. An
element of the current highway financing legislation – known as
"revenue-aligned budget authority" or RABA, pegs highway funding to
those receipts. However, the accuracy of Treasury's estimates is
being examined.
Officials of the American Association of
State Highway and Transportation Officials (AASHTO) joined members
of Congress in asking for a fresh look at the Treasury Department's
assumptions underpinning the analysis. If its approach is found
valid, the cuts could be devastating for highway programs nationwide
– but motor fuel tax receipts and other indicators in several states
show no such precipitous drop as Treasury suggests is
occurring.
In terms of
potential job losses nationwide, the American Road and
Transportation Builders Association (ARTBA) concluded, in its
response to the Treasury analysis, that a $9 billion funding cut
would eliminate some 295,000 jobs, with the largest hits being
absorbed by California, Texas and New York.
"Transportation is vital to our economic
prosperity. It should be a top priority as we seek to recover from
this recession," said AASHTO President Brad Mallory, Secretary of
the Pennsylvania Department of Transportation. "Cutting federal
highway funding by $9 billion would have a devastating effect on the
delivery of needed transportation projects, and would result in
thousands of lost jobs. It's totally the wrong direction for the
time at hand."
Mallory
said the first step in addressing the issue should be a review of
Treasury's estimating process. He said AASHTO appreciates a request
made to the General Accounting Office for a review of the Treasury
process by Chairman Don Young (R-AK) and Ranking Minority Member
James Oberstar (D-MN) of the U.S. House Transportation and
Infrastructure Committee. "But even beyond that, Congress and the
Administration must also look at the damaging potential impact on
state transportation programs and the national economy" in deciding
whether to accept the Treasury analysis, Mallory said.
For the past three
years, federal highway funding levels set in the current
highway-funding legislation, known as the Transportation Equity Act
for the 21st Century (TEA-21) have been increased by the infusion of
funding from RABA. Revenue-aligned budget authority, which did not
exist prior to TEA-21, was meant to ensure that revenue collected in
the Highway Trust Fund above regular authorization levels would be
fully spent. However, the language that established RABA also calls
for decreases in budget authority and obligation levels should
trust-fund revenues fall short of projections. Treasury is the
agency that makes the projections.
To date, revenue into the Highway Trust Fund
has far exceeded what was projected when TEA-21 became law in 1998.
That led to a total of $8.9 billion in additional RABA authority
through FY 2002, above base levels established in TEA-21. In FY
2003, however, there is a potential for "negative" RABA to
occur.
State DOT
officials are perplexed by Treasury's RABA-related projections
because they assume a massive slide in the tax receipts into the
Highway Trust Fund. That is not happening in Pennsylvania, Mallory
said: "Motor fuel tax receipts in our state, and other states around
the country, continue to be steady." Similarly reports from
California, Pennsylvania and Illinois all indicate that motor fuel
tax receipts increased during FY 2001, drawing into question the
accuracy of the Treasury Department's estimates.
Further, preliminary estimates from the
Federal Highway Administration through November show that vehicle
miles traveled increased by .8 percent on the national level over
the previous year. |
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