Latest Headlines Reports Highway Program Hangs in Limbo 1.2.04

January 2, 2004
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The Transportation Equity Act: A Legacy for Users (TEA-LU) bill would reauthorize federal surface transportation programs by providing $298.7 billion for highways over the next six years and $69.2 billion for transit, but the response from congressional leaders and the White House has been less than enthusiastic.

The economy may be showing tentative signs of recovery, but we're still a long way from the roaring 90s. Few companies have made substantial additions to their payrolls in recent months, and now there are rumblings of concern in the halls of Congress and company boardrooms alike about the potential economic impact of big new federal deficits.

So imagine if someone suggested a program that would create more than 1.7 million new jobs over the next six years, generate more than $780 billion in economic activity, save lives, and enhance the nation's economic efficiency without adding a single penny to the deficit. You'd think the President and GOP leaders on the Hill would jump for joy, right?

Government studies suggest there are more than 47,500 jobs associated with each $1 billion the federal government spends on roads and that each dollar invested in infrastructure yields $2.60 in economic activity. At the same time, traffic congestion resulting from inadequate roads costs the economy more than $67 billion annually in terms of wasted time (3.6 billion hours) and wasted fuel (5.7 billion gallons). And more than 1,000 traffic deaths each month are attributable to poor road conditions and roadside obstructions.

Those facts led the bipartisan leadership of the House Transportation & Infrastructure (T&I) Committee last month to propose the Transportation Equity Act: A Legacy for Users (TEA-LU). The bill would reauthorize federal surface transportation programs by providing $298.7 billion for highways over the next six years and $69.2 billion for transit.

The funding increases would be paid for by a small increase in the gas tax highway user fee, which is currently pegged at 18.4 cents per gallon. Because only those who use the roads pay the tax and because all user fee revenues are used for transportation improvements, AED believes a user fee increase is the fairest and most fiscally responsible way to pay for the road improvements our nation desperately needs.

But despite the nation's infrastructure crisis and the tremendous economic benefits TEA-LU would bring, the response from congressional leaders and the White House has been less than enthusiastic.

Some conservative Republicans are balking at the idea of higher gas taxes because they don't understand the difference between a tax and a user fee and are taking a rigid "no new taxes" stand. Others are concerned about voter backlash when gas prices go up.

But given that gas prices can fluctuate by several cents each week and that prices vary by as much as 20 cents per gallon in some areas, we don't think the average American driver will notice any negative impact at all from a user fee increase. What they will notice before long is less congestion, less wear and tear on their cars from bad roads, and a reduction in the number of traffic accidents.

TEA-21, the six-year highway bill enacted in 1998, expired at the end of last September. The short-term TEA-21 extension enacted in the fall is due to expire at the end of February. That means Congress has just two months to get a new highway law in place. With the start of the construction season just a few months away, lawmakers face a stark choice: Enact a beefed-up highway program that puts people to work, provides a level of economic certainty for construction industry companies for the next six years, reduces traffic congestion, and saves lives, or squander an opportunity to get the economy squarely on its feet and do and lot of good in the process.

Source: Associated Equipment Distributors (, Dec. 23, 2003

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