A few years ago Kansas Sec. of Transportation Deb Miller had a group look at future needs for the state’s highways, airports and railroads. Among the topics of discussion was the federal highway fuels tax. The federal tax on diesel and gasoline provides the money sent to the states as the national share of building and repairing roads and bridges.
The 18.4-cents-a-gallon tax hasn’t been raised since 1993. Adjusted for inflation, it is now the equivalent of 11 cents a gallon. Eighteen years ago the fuels tax brought in more than was dispersed and the highway trust fund had a healthy surplus. For all of the obvious reasons, the tax no longer brings in enough to cover costs and Congress has had to supplement the revenue from the general fund, adding a bit to the deficit each year.
At that years-ago conference in Topeka the consensus was that the federal tax should be sharply increased, raised perhaps to 50 cents a gallon. It was, needless to say, a biased group. The men and women who made it up came convinced (1) that a good transportation system is a foundation for economic growth and progress; (2) that paying for it with user fees is sound financing; and (3) that those user fees must be increased to account for inflation, for increased use of the system and for unusual increases in construction and maintenance costs such as the multi-fold increase in the cost of oil (read asphalt).
These arguments apparently have fallen on deaf ears.
The federal gas tax not only has not been increased, it is set to expire on Sept. 30. If it is not extended by Congress, then the matching funds to the states will be limited to the amount Congress decides to borrow each year for that purpose.
IN NORMAL TIMES Congress could be expected to do the rational thing, which would be to make the fuels tax permanent — since the need for a superior transportation system has no time boundary — and raise it at least to 40 cents a gallon and provide for future automatic increases to make it inflation-proof.
Taking these steps would not only provide federal matching funds for the states but also would remove a burden on the federal budget and make deficit reduction a tad easier.
Making certain that federal matching funds for transportation remain available is critical to keeping state budgets funded and to maintaining current levels of employment. In Kansas, for example, federal matching funds cover 90 percent of the cost of maintaining the interstate highways. The federal share of the cost of all federal highway maintenance and construction is substantial. Almost all of that work is done by private construction companies — such as SE-KAN Asphalt of Iola — so it is accurate to say that the money that highway users spend on fuels taxes is very quickly re-spent in the national economy.
Killing the tax would kill tens of thousands of well-paying construction jobs.
That is why, incidentally, economists maintain that increased investments in road and bridge construction and repair are among the fastest — and most useful — ways to stimulate the economy.
THESE ARE NOT normal times. There will be those, in Congress and out, who will want to allow the fuels tax to expire because the political religion they profess persuades them that all taxes are evil. An even larger number will oppose increasing the tax, citing the same holy commandment. They should be gently but firmly opposed by the Amalgamated Pot-Hole Haters of the World, who understand that there is no such thing as a free lunch — no matter what Grover Norquist of Americans for Tax Reform says.
— Emerson Lynn, jr.
