Turning Transportation Funding Upside‐Down
House Transportation and Infrastructure Committee Chair James Oberstar (D-MN) has released more than 100 pages of documents describing how he wants to run federal transportation programs over the next six years. He proposes to spend $500 billion on highways and transit, which is a huge increase over the $338 billion authorized for the last six years.
Congress authorizes federal transportation spending in six-year cycles. In 1956, when Congress created the Interstate Highway System, it dedicated gas taxes and other highway user fees exclusively to highways. But in the 1982 reauthorization, it began diverting a small amount of gas taxes to transit.
Today, about 20 percent of the federal gas taxes you pay go to subsidize transit, while the other 80 percent supposedly go for highways — though much of that is wasted in planning and earmarks. Nationally, highway subsidies — mostly at the local level — average about a penny per passenger mile, while transit subsidies — much from your federal gas tax — average more than 60 cents per passenger mile.
Since 1982, transit has received hundreds of billions of dollars in subsidies from highway users. Yet in 2008 — supposedly a boom year for transit because of high gas prices — per-capita transit ridership was lower than it was in 1990, though higher than in 2000.
Oberstar considers this to be a great success. Building on that "success," he effectively wants to turn the formula around: 20 percent for highways and 80 percent for transit. The executive summary of his plan supposedly “provides $337.4 billion for highways.” But, in fact, only $100 billion of this is dedicated to highways; most of the rest is in “flexible funds” that states and cities can spend on either highways or transit. Nearly $100 billion goes for transit, and $50 billion goes for high-speed rail. The remaining $12.4 billion goes for safety programs.
Oberstar's detailed plan proposes to burden the Federal Highway Administration with an "Office of Livability." This office would oversee land-use plans that all major metropolitan areas would be required to write; these plans would attempt to coerce people out of their cars by increasing population densities, spending flexible funds on transit, and spending highway money on reducing, rather than increasing, road capacities.
Page 38 explains that this is because past transit investments have “paid off” so well: transit carried 10.7 billion trips in 2008. The fact that this represents less than 1 percent of passenger transport is discreetly overlooked, especially by transit advocates who think they should get at least half of all transportation dollars.
For those who truly care about mobility, the saving grace is that the government is running out of money and cannot possibly afford Oberstar’s program. Even the Highway Trust Fund has run dry because the last reauthorization allowed Congress to spend more money than the revenues produced from gas taxes. Considering that President Obama is opposed to increasing the gas tax, no one has any idea where Oberstar thinks he is going to find $500 billion.
As a result, Secretary of Transportation Ray LaHood, on behalf of the Obama administration, wants to delay reauthorization for 18 months. Of course, Oberstar thinks this is a bad idea — it delays his moment in the sun, possibly until a time when he no longer chairs the committee.
The real problem, however, is that most people in Congress and the administration no longer see the value in funding transportation out of receipts or any connection at all between benefits and costs. Instead, it is just a big game of pork barrel and, for the slightly more idealistic, social engineering. All this lends credence to the idea that we should simply privatize our highways and transit systems.
