This week, U.S. House Transportation and Infrastructure Committee Chairman Bill Shuster (R-PA) released his long-awaited infrastructure discussion draft. Key components of the plan include fixing the Highway Trust Fund (HTF), investing in transportation and water resources infrastructure, financing innovative projects, and accelerating project delivery.
The plan also calls for an increase of 15 cents per gallon of gasoline and 20 cents per gallon of diesel to the existing federal gas tax while extending HTF expenditure authority to September 30, 2021. Additional HTF revenue is collected through an added tax to electric vehicle batteries and bicycle tires as well as an application of a 4.3 cents per gallon tax on diesel used by passenger trains and eliminating the reduced rate for intercity and local public transportation buses. However, the draft proposes ending the gas tax as a revenue raised in 2028, as a means to encourage Congress to identify and pass another funding solution by then. While providing an incentive to implement an alternative, this is also a risk if there is not a bill passed with a new funding mechanism.
The proposal aims to address long-term HTF solvency by establishing a HTF Commission, which will submit a report to Congress that includes new recommendations to achieve solvency, which cannot include a motor fuels tax increase. This proposal will include a provision allowing for expedited consideration of the legislation by Congress. a per-mile user fee surface transportation system funding pilot
Other transportation investment recommendations include awarding 30 percent of BUILD (formally known as TIGER) grants to projects in rural areas and expand program access; extending FAST Act authorization through fiscal year (FY) 2021 and repealing rescissions included in that law.
Water infrastructure investments include a reauthorization of the Water Infrastructure Finance & Innovation (WIFIA) program, including allowing the U.S. Army Corps of Engineers (USACE) to enter into an agreement with the U.S. Environmental Protection Agency (EPA) to service loans for the USACE’s WIFIA program. The proposal also includes a five year, $3 billion annual authorization for the Clean Water State Revolving Funds (SRFs), which help finance wastewater treatment projects. Additionally, the plan includes a new budgetary mechanism to allow all revenues from the Harbor Maintenance Trust Fund to be spent on port dredging projects, a provision which ASCE has long supported.
Financing opportunities are expanded by authorizing funds for FY 2019-21 for the loan guarantees for the Railroad Rehabilitation and Improvement Financing (RRIF) program. Lastly, the proposal seeks to accelerate project delivery through a “one federal decision” model through the National Surface Transportation and Innovative Finance Bureau and establishing a pilot program to review the National Environmental Policy Act (NEPA) process to find ways to accelerate project delivery.
Kristina Swallow, P.E., President, American Society of Civil Engineers, made an official statement after the release of the discussion draft:
“Engineers, along with business and labor, have been urging Congress to develop a broader bill to address the nation’s infrastructure needs for years. We are pleased that Chairman Shuster has answered that call with a draft that includes funding to modernize our nation’s roads, bridges, and transit systems.
“We encourage Members of Congress to build upon this plan and commit to making this their top priority. The draft proposes a gas tax increase tied to inflation to better fund the surface transportation network. This is the best and most efficient option to ensure the Highway Trust Fund has long-term, sustainable funding, and ASCE urges Congress to include this funding in the final bill. We haven’t seen an increase in the gas tax since 1993, and inflation has cut its purchasing power by 40%.
“Historically this has been a bipartisan issue, and it can again be a place for Democrats and Republicans to work together to do what is best for the American people. Each day we delay, every American household loses $9 due to inefficient infrastructure. This has gone on long enough. It’s time to address these challenges, increase investment, and modernize infrastructure.”
Congress has a busy agenda, including a few specific infrastructure bills in the works, heading into the election. It is anticipated that the earliest this draft legislation will be considering is after the November election during the lame duck session.
Stay tuned for how the conversation progresses, including when Congress should hear from you about passing a bill!