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AASHTO approves $544.5 billion Transportation Reauthorization Proposal

Oct. 21, 2008

At its Fall Board meeting the week of Oct. 20, AASHTO approved a proposal from its SAFETEA-LU reauthorization task force to recommend to Congress that next year's surface transportation legislation authorize $544.5 billion in new funding. This would almost double the $286 billion authorized over six years in SAFETEA-LU. AASHTO recommended a menu of different measures that could be used to raise the revenue necessary to fund the program at this level, including:

increase the Federal motor fuels tax by 1 cent per gal (raising $1.8 billion annually);

establish a national vehicle sales tax of 1% ($9 billion per year);

establish a 1% sales tax on motor fuels ($4.7 to $7.6 billion annually);

establish a distance traveled tax at 1 cent per mile ($32.4 billion annually);

implement a freight tonnage tax (42.8 billion per year);

create a tax credit bonding program ($50 billion); and

institute a $10 fee per container shipped through U.S. ports ($600 million per year).

The container shipping fee would be maintained in a new and separate freight fund account.

The AASHTO proposal also recommended a number of reforms to the program. Chief among them is to limit the amount of funds that can be earmarked for specific projects to no more than 5% of total spending. In SAFETEA-LU members of Congress earmarked 18% of the program for specific projects.

AASHTO also recommended consolidating the number of funding programs from more than 100 to six key programs as follows:

preservation and renewal;

freight capacity;

highway safety improvement;

operation and maintenance;

congestion reduction; and

environment.