Highway Trust Fund
Ensure the solvency of the Highway Trust Fund to fully fund SAFETEA-LU and future revenue needs. AGC supports the firewall mechanism and funding guarantees that ensure that highway user fees are invested as intended in transportation infrastructure. Prior to 1998 the Highway Trust Fund (HTF) was allowed to accumulate a large balance which was used to off-set deficit spending on other parts of the Federal budget. The enactment of TEA-21 in 1998 established firewalls to prevent HTF revenue from being spent on other programs, and funding guarantees were put in place to prevent the build-up of a huge balance. These firewalls were continued in SAFETEA-LU.
Infrastructure Job Creation
Create jobs through increased infrastructure funding. Investment in infrastructure both directly and indirectly creates jobs. Construction is a major source of good-paying jobs, providing employment to 7.5 million employees making on average over $20 per hour, 20 percent higher than the average private industry wages. The U.S. Department of Transportation, for example, estimates that for every $1 billion invested in transportation, 47,500 jobs are created.
Gas Tax
Oppose Temporarily Suspending the Gas Tax
Background:
Suspending the gas tax will not help consumers or the future of our nation. It is bad transportation policy, bad energy policy and bad economic policy. While superficially attractive, suspending the gas tax will not address the root cause of our gas price problem today, which is a complex combination of many factors. It is really nothing more than political gamesmanship.
AGC Message:
-Suspending the Gas Tax Will Not Help Consumers. A gas tax suspension will not necessarily result in lower gas prices. There is no guarantee that any of the savings will be passed on to consumers. The federal gas tax of 18.4 cents per gallon makes up just a small portion of the price of gas (about 6 percent, assuming a price of $3.00 per gallon). Thus, even if the savings were passed on to consumers, they would be minimal.
-Suspending the Gas Tax is Bad Transportation Policy. A gas tax suspension would violate the sanctity of the Highway Trust Fund. This would undermine this trust by putting at risk billions of dollars of necessary investment in our nation’s highway and transit infrastructure. All motor fuel user fees (gasoline and diesel taxes) are deposited into the Highway Trust Fund. And thanks to TEA-21 and SAFETEA-LU, all of those revenues are guaranteed to be spent on highway and transit improvements. As a result of the loss of revenue from a temporary or permanent repeal:
- States and localities could face significant reductions in spending for transportation planning, highway and bridge repairs, public transit, bike and pedestrian facilities, clean air programs, and, most importantly, highway safety.
- Construction of congressionally-designated projects of national significance would also be affected.
- Without a predictable flow of federal transportation funds, states and localities may face more difficulty in long-term transportation planning, which will cause projects to be more costly and result in safety concerns.
- Highway and bridge improvements that have already been delayed for nearly two years while Congress debated the reauthorization of TEA-21 will be further delayed by a gas tax suspension.
- Any modest savings a motorist may receive by suspending the gas tax will be offset by an additional average $401 per year in increased maintenance and reduced fuel efficiency resulting from reduced road improvements.
- A Gas Tax Suspension is Bad Energy Policy. A feel-good gas tax suspension is no substitute for a comprehensive energy policy that decreases our dependence on foreign oil. This will not do anything to increase our fuel supply or curb demand for fuel during this crisis.
- A Gas Tax Suspension is Bad Economic Policy. A gas tax suspension would reduce federal revenue, thereby increasing the federal deficit. The suspension could hurt the economy by putting at risk billions of dollars of investment. Again, with the economy suffering from the effects of last year’s hurricanes, this is the wrong time to be disinvesting in the nation’s infrastructure.
State Police- Highway Funding Bill
This legislation would over time change the lopsided nature of State Police funding and have more of the State Police budget covered by the state's general fund. The money in the highway fund would be available to fund bridge and highway repair projects.
•Currently there's a yearly appropriation of $500 million to the State Police from the Motor License Fund. That equals 73% of the State Police budget. In 1993 the commonwealth appropriated $215 million from the Motor License Fund which was 67% of the State Police's budget.
•While some portion of the highway patrol should be funded by Motor License Fund, monies this high percentage is hampering PennDOT's capital program. It's time that the State Police Budget be funded more from the General Fund.
•To put things in perspective, that $500 million from the Motor License Fund equals approximately 8 cents of the current gas tax.
 
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