Tax reform, trust funds and tolls are options in White House highway bill

By David Tanner, Land Line senior editor | Friday, April 17, 2015

The White House’s proposed highway bill, the $478 billion GROW AMERICA Act, contains numerous funding options for highways, bridges, transit and transportation programs, but what stands out for truckers?

Perhaps the most talked-about provision as of press time is one that would allow states more latitude to place tolls on interstate highways and bridges by lifting the current moratorium on tolling federally funded highways.

OOIDA and other highway user groups oppose interstate tolling and want that concept to die before a highway bill ever hits the House or Senate floor.

The Americans for Toll-Free Interstates, an organization that has OOIDA as a member, sums up the issue well.

“Tolling interstate lanes, which drivers now freely access, is an inefficient financing mechanism that is the worst possible approach to raising transportation revenue,” ATFI spokesman Julian Walker told Land Line.

“The idea has already been rejected by lawmakers, the public, and community leaders in the few states with a federal exception to the tolling prohibition. Tolls also divert heavy highway traffic onto secondary streets, which leads to premature road breakdown that costs local taxpayers. And they endanger public safety when rescue workers are delayed in responding to emergencies,” Walker said.

Walker points out that the tolling proposal would allow states to redirect toll revenues to completely unrelated projects, a diversion that highway users oppose.

GROW AMERICA – an acronym for Generating Renewal, Opportunity, and Work with Accelerated Mobility, Efficiency, and Rebuilding of Infrastructure and Communities throughout America – Act would spend $317 billion on highways and road safety over six years.

In addition, it would spend $115 billion on transit; $18 billion on a new multimodal freight program; $28.6 billion for passenger rail; and $13.5 billion to expand discretionary grants and loans programs.

Tolling highways wouldn’t begin to cover those costs, so what will? The GROW AMERICA Act offers up numerous ideas – some old, some new.

Tax reform
The White House and some congressional lawmakers envision a tax-reform package to pay for most of the GROW AMERICA Act.

The reform model would lower the corporate tax on offshore funds that are brought back to the U.S. economy. This is known as “repatriation,” and the current tax rate on repatriated funds is 35 percent. The act would impose a one-time tax rate of 14 percent on repatriated funds in an effort to entice U.S. companies to bring their money home and invest it in infrastructure.

The White House estimates that there is currently $2 trillion in untaxed U.S. corporate earnings held in foreign banks.

Transportation Trust Fund
The GROW AMERICA Act calls for a retooling of the Highway Trust Fund to become the “Transportation Trust Fund.” The expanded fund would incorporate multimodal freight funding and high speed rail in addition to the “highways, bridges and transit” model that currently exists. The debate is just getting started on this one.

TIGER and TIFIA
Two existing programs with catchy acronyms would get more federal funding if their provisions move forward. They are TIGER, Transportation Investment Generating Economic Recovery, and TIFIA, Transportation Infrastructure Finance and Innovation Act.

Both are U.S. DOT programs that dole out money based on the importance of a project, such as a bridge, to its region.

Grants from TIGER, which are general funds and do not come from the Highway Trust Fund, require a local match of funds but do not have to be paid back. Loans from TIFIA to attract private investors, paid out of the Highway Trust Fund, would need to be paid back. For highway users, the “payback” function of TIFIA often involves tolling.

What about fuel taxes?
The GROW AMERICA Act is silent on the topic of fuel taxes. Some lawmakers have offered up fuel-tax increases to pay for transportation, but the White House has repeatedly said now is not the time to do that.


Tax reform, trust funds and tolls are options in White House highway bill
The White House’s proposed highway bill, the $478 billion GROW AMERICA Act, contains numerous funding options for highways, bridges, transit and transportation programs, but what stands out for truckers?

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