United States Department of Transportation
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Future Surface Transportation Financing Options: Challenges and Opportunities for Rural States
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2009-05-01
[PDF-1.39 MB]
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Alternative Title:UVM TRC Report # 09-003: Future Surface Transportation Financing Options
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TRIS Online Accession Number:01160575
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Abstract:The funding of America's transportation system is a complex process that includes a number of stakeholders, both private and public. The federal gas tax has been a major contributor to the funding of transportation projects- even those planned, designed and constructed by individual states. The cost to maintain, and preserve, the current national transportation system is well documented and has eclipsed the amount of funds available under the current financing structure. [1] In short, our transportation system is failing and so is the national system that funds it. Much of the current literature on transportation funding warns that failure to fund transportation infrastructure can lead to major consequences, as transportation plays a significant role in the national, state, and local economies for access to jobs, recreation, education, healthcare, and the shipment of goods. This situation is also true in Vermont where the challenges of small population, small tax base, rural setting and aging infrastructure have exacerbated the problem. The federal gas tax (and most state gas taxes) is a fixed amount per gallon, not indexed for inflation. This has been long known as a weak revenue structure to transportation professionals. New environmental, economic and transportation policies seek to increase fuel efficiency for vehicles and encourage alternative fuels. The success of these policies will cause revenues from the gas tax to decrease. This paradox of conflicting policies is not widely observed in the public discourse. As the public becomes increasingly engaged in the debate over how the post-gas tax transportation system will be funded there is a need to construct a better framework so that the current financing structure and options can be readily displayed and made accessible to the public and to policy makers. At the national level, the Commission on National Surface Transportation Policy and the Revenue Study Commission are considering short and long-term alternatives to replace or supplement the gasoline and diesel tax as the principal revenue source to support the Federal Highway Trust Fund (HTF) over the next 30 years. Actions are also being initiated on the state level in a number of states, in part to meet immediate resource shortfalls, but also to test new revenue systems for longer-term deployment. The outcomes of these various deliberations and experimentation inform this report and how it addresses questions such as: 1. How are other states and nations preparing themselves for a post gas tax world? 2. What are the differences between options that are being proposed for federal funding compared to options proposed for state funding? 3. Which new systems are in discussion at the federal level and do they include specific accommodations for small, rural states? 4. Which states might pursue similar alternative future financing procedures similar to those in Vermont? 5. What methods are proposed elsewhere to capture revenue from non-residents traveling on roads? 6. What types of road pricing schemes are being pursued in rural versus urban areas? 7. What types of private-public partnerships are being pursued in rural versus urban areas?
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