FHWA head: Gas tax becoming obsolete - tolls an option

| Tuesday, January 13, 2004

Federal Highway Administrator Mary E. Peters said Jan. 12 the federal gasoline tax is becoming obsolete and urged a combination of new funding mechanisms to underwrite the nation's highways and other forms of surface transportation, according to press reports.

Peters told a meeting of the Transportation Research Board of the National Academies, a research group, "We can't depend on fossil fuel taxes into the future." She did not go into detail.

The current federal gas tax, which goes into the dedicated Highway Trust Fund, is 18.4 cents per gallon. Revenue has not kept pace with spending needs for several years as cars have become more fuel efficient, Peters said, adding that this will be even more of a problem as drivers begin using more alternative fuels.

Peters said the administration is urging Congress to "look more at a public utility model" to raise revenue, such as tolls on interstate highways that could vary based on the time of day and amount of congestion.

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