The Highway Trust Fund Gets an $8 Billion Fix

After working its slow and tortured way through Congress, the desperately needed legislation to move money from the General Fund to the Highway Trust Fund was quietly signed into law by President Bush, who had earlier threatened to veto it.

Increasing fuel costs have lead to fewer miles being driven. Driving less means less purchase of fuel, which means less federal tax, the only source of income for the Highway Trust Fund. As Secretary of Transportation Mary Peters noted in remarks about the shortfall, “For the first time in history, vehicle miles traveled dropped more than 50 billion miles over eight months.”

During the summer there were warnings that the Trust Fund was going to run out of money fairly soon. In July the House of Representatives easily passed by a vote of 387 to 37, HR 6532 that authorized the return to the Trust Fund of $8 Billion that had been taken from the fund in 1998 to be used for other purposes. The White House said the measure would be vetoed if it got as far the President’s desk.

“When it came time to address the rapidly growing Trust Fund solvency issue, Congress chose to do nothing,” argued Peters. “Instead, members continued to earmark, continued to divert transportation dollars to lighthouses and museums, and continued to spend like there was no tomorrow.” In reaction, Democratic Members of Congress like Oregon’s Peter DeFazio, chairman of the House Subcommittee on Highways and Transit, and California’s Barbara Boxer, chair of the Senate’s Environment and Public Works Committee placed blame for the funding shortfall on the Administration.

When the House bill moved to the Senate in July, the matter of the $8 Billion transfer was included in an amendment to S 3335. This was a much larger bill, called the Jobs, Energy, Families, and Disaster Relief Act of 2008. Those opposing the bill used a filibuster to stop it. The bill was effectively killed when Senators voted 51-43 to break the filibuster but did not reach the 60% majority needed to do so.

In early September, Secretary Peters claimed that instead of running out of money sometime in 2009, as had been indicated in earlier comments, in fact funding would run out at the end of the month. At last, both parties and the Administration moved to pass and sign the needed legislation.

This is all a foretaste of what is in store for the federal government next year. The massive funding bill, SAFETEA-LU (the Safe, Accountable, Fair and Efficient Transportation Equity Act –A Legacy for Users) that became law in August 2005 is due to expire in September 2009.

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