In a 74-22 vote last week, the Senate passed a two-year highway bill authorizing about $109 billion in spending. The previous authorization bill was enacted in 2005 and expired in 2009. Since then Congress has approved several extensions, and the most recent one expires at the end of this month.
Attention now turns to the House where the leadership must decide whether to vote on the Senate bill, consider another short-term extension, or try again to build support for a five-year $260 billion bill approved by the House Transportation and Infrastructure Committee earlier this year. Speaker John Boehner has not scheduled a vote on the House bill because many Republicans are concerned about its cost. Democrats oppose the bill due to funding cuts and provisions such as a proposal to use oil drilling revenues as an offset.
A gap between spending needs and gas tax revenues flowing into the Highway Trust Fund has made agreement on a new bill difficult in recent years. Since 2001, outlays have generally exceeded revenues in the trust fund. Earlier this year, CBO estimated that the two accounts that fund the highway trust fund would be unable to meet obligations within two years.
An honest discussion of the trade-offs needed to fund transportation priorities should be on the agenda when a final bill is negotiated. Spending from the trust fund should be limited to the revenues collected, and policymakers should end the practice of funding new spending with deficit-financed transfers from the general fund of the Treasury. Policymakers should agree on realistic spending levels that reflect a bipartisan consensus of actual needs. When revenues in the trust fund fall short of these levels, any additional spending should be paid for with credible offsets that are sustainable over the long term.
Read more with The Highway Bill: Guideposts for Policymakers