Too Big to Fall: America's Failing Infrastructure and the Way Forward

4. Finding the Money

4 Finding the Money America’s neglect of the transportation infrastructure it built at great expense in the twentieth century has not only left its roads and bridges in an inadequate condition for meeting the demands of the twenty-­ first. The neglect has also raised the cost of repairing and improving the country’s existing infrastructure to astronomical heights. The National Surface Transportation Policy and Revenue Study Commission (nstprsc) estimated that between $130 billion and $166 billion per year would be needed in highway capital investments (for all federal-­ aid highways) from 2005 thru 2020 in order to meet a set of goals that include maintaining pavement quality at current levels, an estimate that rises to $146 to $195 billion annually for the period 2005–55. For bridges, the commission found that “simply maintaining the current overall level of bridge conditions at current levels (i.e., not allowing the backlog of existing bridge deficiencies to grow above today’s levels) would require a combined investment of public and private sector resources of $650 billion over 50 years in 2006 dollars,” while “the cost of eliminating all existing bridge deficiencies and addressing all such deficiencies as they arise over the next 50 years (where cost-­ beneficial to do so) is estimated to be $850 billion in 2006 dollars.”1 Citing figures from the Federal Highway Administration (fhwa), the American Association of State Highway and Transportation Officials (aashto) reported in 2008 that it would cost “$140 billion in 2006 dollars to immediately repair every bridge that is deficient in the country,” including $48 billion for structurally deficient bridges.2 Such estimates, of course, need to be understood against the backdrop of the severe shortfalls in funding for surface transportation infrastructure generally, and for America’s deficient roads and bridges in particular, discussed in chapter 2. Meanwhile, the federal Highway Trust Fund (htf) had to be rescued from insolvency in 2008, and, 102 Too Big to Fall according to the final report of the National Surface Transportation Infrastructure Financing Commission (nstifc), “this problem will only worsen until Congress addresses the fundamental fact that current htf revenues are inadequate to support current federal program spending levels. Comparing estimates of surface transportation investment needs with baseline revenue projections developed by the Commission shows a federal highway and transit funding gap that totals nearly $400 billion in 2010–15 and grows dramatically to about $2.3 trillion through 2035.”3 Both the nstprsc, which issued its final report in December 2007, and the nstifc, whose final report appeared in February 2009, made extensive proposals for federal responses to the need to improve the condition of the nation’s roads and bridges.4 This effort must start with solving the problem of how to finance the htf in the future. In making its “Recommendations for Paying the Bill” of the nation’s unaddressed surface transportation needs, the nstprsc proposed responses in three time frames: “immediate” action to keep the htf solvent; action over the next twenty years “to finance improvements needed to enhance surface transportation system conditions and performance”; and actions “after 20 years to replace the fuel tax with a more sustainable revenue source.” Noting the “growing consensus that alternatives to the fuel tax may be necessary in about 20 years,” the commission concluded that, for the time being, “the fuel tax should remain an important component of surface transportation finance” and proposed raising the federal gas tax from five to eight cents per gallon per year over the next five years, with indexing to match inflation thereafter. Beyond 2025, the nstprsc said, the federal government and the nation as a whole must switch from a reliance on fuel taxes to mileage-­ based user fees.5 The nstifc, for its part, also proposed increasing the federal gas tax as an immediate measure for bolstering the htf, as well as “positioning Federal funding for the longer term” with a “more direct user charge system” to be fully deployed by 2020, gradually eliminating fuel taxes as the primary funding mechanism for surface transportation.6 Finding the Money 103 The nstprsc’s proposal for action between 2005 and 2025, including its recommended federal gas tax increase, stipulates that over this period, the federal government “should contribute approximately 40 percent of total surface transportation capital outlay in line with the Federal share in recent years [37 to 46 percent for highways].”7 While it is debatable whether the...