Yesterday and today, I briefed members of Congress on the Highway Trust Fund situation and proposed an immediate 18-month highway reauthorization that will replenish the Fund.
This is an unusual step, I know. But, with the Fund likely to run out of money by late August, it's a little too late to worry about business as usual.
Beyond keeping the Highway Trust Fund solvent, an immediate 18-month reauthorization provides Congress the time it needs to fully deliberate the direction of America's transportation priorities. That's the kind of thoughtful decision-making America deserves.
Passing transportation legislation in Congress is a complicated process. How the Highway Trust Fund went south? Not so complicated.
Here's how it works...
Highways are built, repaired, and maintained with payments from the Highway Trust Fund. The Fund is replenished by revenue collected from motor fuel taxes when Americans buy gas. When Fund spending in a given period is more than the gas tax collected in the same period, the Fund declines. When the decline persists over months or years, the Fund runs out of money and limits the ability of the Federal government to help states.
As the chart below shows, even in years of relative economic security and gas-price stability, the Highway Trust Fund ended the fiscal year with less money than it started.
Roadwork is not a simple undertaking. Our road-building and road-maintaining commitments must be planned years and years ahead. But, when times are uncertain, Americans are making gas-pump decisions month-to-month, some even day-to-day.
I hope you can see the mismatch that can lead to. In years of combined economic insecurity and gas-price volatility, like 2008, people buy less gas and the Fund's revenue source drops off.
You can see from the chart above where that led us in 2008. Congress had to kick in an extra $8 billion to the Fund.
You can also see where it has brought us so far in 2009. The Fund is likely to run out of money once again, and soon. Expenditures will stop; states will be in danger of losing the vital transportation funding they need and expect; projects will shut down; jobs will be lost.
That's the road we're on right now. Once again, the Highway Trust Fund will need a massive cash infusion.
Can we really go through this every year? Is that really the best this Nation can do?
I don't think so. That's why I went to the Hill yesterday and why I'll be there today.
That's why I proposed a quick, but brief, reauthorization that will free Congress and this Administration to better address long-term transportation policy.
Time is running out, and the Highway Trust Fund must be made solvent. Then, and only then, can this country get the kind of thorough transportation discussion needed to address our infrastructure investments in a smarter, more focused way, a way that best meets the real demands of the country.
That's a discussion President Obama and I look forward to. But, first we need to take care of business.