The National Infrastructure Commission:
Even though an estimated 82 percent of American cities and towns receive their goods exclusively
By Bill Graves
To measure the American public’s paradoxical interest in the importance of infrastructure to daily life, one need look no further than the reaction to two recent events: the Minneapolis bridge collapse and the recommendations of the National Infrastructure Commission. The first showed the vulnerability of our infrastructure and the public’s demand that our highways, bridges and tunnels be safe.
The second, with its recommendation for an increase in the fuel tax, showed the public’s reluctance to actually pay to maintain those same highways, bridges and tunnels. The Commission’s recommendation to increase the fuel tax clearly struck a nerve with American taxpayers, who are reeling from the unprecedented run-up in fuel prices over the past year. As one of the largest payers of federal and state fuel taxes — $23 billion annually — the trucking industry knows all too well the impact of any additional fuel costs on the bottom line.
But we cannot escape the stark reality facing our nation: We have neglected our infrastructure for far too long and the bill is coming due.
Americans must not take for granted the reality that our quality of life is dependant upon the systematic movement of freight on a safe and reliable network of roads and highways, as demonstrated by the fact that a full 82 percent of American cities and towns receive their goods exclusively by truck. Accordingly, the trucking industry is acutely aware of the critical need to maintain the world’s pre-eminent transportation and infrastructure network.
Critics attacked the increase in the fuel tax, instead coming out in favor of tolling increases and privatization. But neither is a more effective solution than the one that has been in place since the inception of the interstate highway system.
Upon closer examination, it is apparent that fuel taxes are the most efficient and equitable method to raise dedicated highway funds. In essence, fuel taxes are the ultimate user fee or pay-as-you-go approach, which is why they have been used for so many decades to build our existing infrastructure.
Moreover, the substitution of fuel taxes with schemes such as the privatization and tolling of existing highway infrastructure, congestion pricing fees, or toll increases that divert highway revenues away from infrastructure projects, will result in Americans paying a significantly higher price to access our highway system while receiving less in the form of safe, efficient and reliable roadways.
Considering that the nation’s infrastructure is already paid for with fuel taxes, adding tolls is simply a way of adding a new tax. Tolls represent a double taxation on motorists – one that incentivizes drivers to use roads often ill-equipped to handle such large traffic flows. And ultimately the public will pay the price to repair these roads and bridges damaged as a result of that diversion. Furthermore, a full 30 percent of the revenues from tolls typically are spent simply to administer the toll. Administering a fuel tax by comparison, costs between just 1 and 2 percent of the revenues collected. That translates into more money dedicated to addressing critical needs, and less going to fund government bureaucracy.
As recognized by the Commission, America needs to invest heavily in its transportation infrastructure to ease congestion, alleviate bottlenecks and repair the existing infrastructure. Fixing the problem is, without question, a significant financial undertaking.
But current revenue streams are failing to keep pace with infrastructure needs. If the tragic bridge collapse in Minnesota last year taught us anything, it’s that ignoring the overwhelming need can have catastrophic results. The bottom line is that we need an equitable solution and we need it now. This means increased investment coupled with systematic reforms of the way funds are allocated.
Citizens and businesses alike will need to pay their share to restore our aging infrastructure. For its part, the freight transportation industry is willing to do just that, provided funds are allocated to meet the needs of the freight transportation industry.