Texas waits while Congress stalls on highway funding

WASHINGTON - With federal highway dollars set to run out at the end of this month, threatening the summer road-work season in Texas and across the nation, Congress decided this week to take a familiar exit: It extended the money for two months and postponed the problem until the end of July.

The temporary patch, which is expected to get final Senate approval later this week, would forestall a threatened suspension of federal payments to the states, including Texas, which took in $3.1 billion in federal highway funds last year, the most of any state except California.

But while lawmakers declare victory before heading home for a Memorial Day recess, a bipartisan chorus of business and transportation groups is growing increasingly frustrated with Congress' continuing inability to lock down the mounting revenues needed to shore up the nation's aging infrastructure of roads and bridges.

Texas voters passed a ballot initiative last year to pump $1.7 billion in oil and gas revenue into the state's transportation system, giving the Lone Star State a leg up on many of its less fortunate neighbors on the West Coast and the Northeast. But state officials say the lack of a long-term spending plan from Congress is not helping.

"There are a number of strategic corridor improvements needed across the state in both our rural and metro areas that could be more aggressively advanced with a long-term federal funding bill," said Texas Department of Transportation spokesman Nick Wade.

Texas officials say they have been making good progress chipping away at the state's inventory of structurally deficient or functionally obsolete bridges, which comprises about a fifth of the state's 52,937 bridges. But they say they are unable to start major projects without guarantees of all the future federal funding.

Four other states have already discontinued new projects while the congressional impasse continues, now almost a year since the expiration of the last multi-year federal surface transportation bill.

Road funding, historically a bipartisan affair, has prompted a mini-rebellion in the U.S. House, which signed off on the two-month extension on Tuesday.

"Enough is enough," said U.S. Rep. Peter Welch, a Vermont Democrat who led a rump group of 35 lawmakers in both parties who voted against the stopgap measure. In a letter to House leaders, he wrote that "America cannot afford to have Congress kick the can down the road while our roads and bridges continue to crumble and workers remain idle."

While many members of the Texas delegation share the same frustration, none were willing to join the protest. "Two months is better than falling over the cliff right now," said Houston Democrat Gene Green.

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The problem, as usual, is money. Lawmakers in both parties say they would like to pass the sort of multi-year road bills Congress used to pass in past decades. But dwindling Federal Highway Trust Fund dollars from gas taxes have taken a toll.

Experts blame a host of factors, including more hybrid and fuel-efficient cars. Many Democrats - and some Republicans - say it's time to bump up the federal 18.4 cent-a-gallon gas tax, which hasn't been raised since 1993. But that's not likely to happen in a Republican-led Congress, and there's no consensus on an alternative.

"I'm just not going to saddle the American people with further taxes," said former Woodville Mayor Brian Babin, a freshman Republican and a member of the House Transportation Committee. "We're just going to have to find that money somewhere else."

A number of proposals have been floated, including taxing overseas corporate profits and tacking on fees to new exports of crude oil and liquefied natural gas. But those ideas too could be hard to sell in Congress, and certainly unlikely to happen by the end of summer.

"My worry is that if we don't get something with money in it by the end of July, and Congress leaves (for the traditional summer recess) in August, we will have the Highway Trust Fund go bankrupt," Green said. "We can't do that."

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Green said that given the lack of alternatives, he could see raising the federal gas tax another nickel, or indexing it to inflation. "I can defend raising gas taxes for the Highway Trust Fund because people know what it goes for. So I think we need to bite the bullet and deal with this."

While Congress looks for new sources of road money, the experts say the funding gap keeps getting worse, putting more of a squeeze on the states to do as Texas did and come up their own money.

"Congestion pricing," user fees and tolls, like the ones being increased along Interstate 10 around Houston, are becoming more commonplace. So are local bond referendums and dedicated state funds, like last November's Texas Transportation Funding Amendment Proposition 1 that raised $1.7 billion for highway infrastructure.

But even that cash infusion will pay for "little else" beyond taking care of the current backlog of highway maintenance, according to a recently-published state study called the Texas Transportation Plan 2040.

The document, which projects a state population increase of 17 million over the next 25 years, estimates that it would take about $10.5 billion a year just to maintain current road conditions in Texas. That's about double the current annual revenue forecasts.

On the federal level, the Congressional Budget Office predicts that by 2025 the Highway Trust Fund will take in only $38 billion, while spending about $60 billion, leaving a $22 billion annual deficit. Just to keep up with current levels of growth and inflation, a comprehensive national transportation bill lasting six years - the ultimate goal of many lawmakers - would require Congress to come up with an additional $90 billion in revenues.

Transportation analysts who follow the federal appropriations process say that's just a bridge too far. "Anyone who thinks they're going to find $90 billion between now and July 31 for a six-year bill is crazy," said Jeff Davis, founder and editor of the Eno Transportation Weekly.

The fiscal challenges have left Congress playing small-ball with the nation's critical infrastructure needs, many experts say.

"We're a little frustrated and disappointed," said Frederick "Bud" Wright, executive director of the American Association of State Highway and Transportation Officials. "It was no surprise that we were facing a May 31 deadline to get something done on a long-term bill."

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The current two-month extension comes on top of an eight-month extension of a two-year federal spending bill, itself a truncated version of prior transportation bills that would set forth spending levels for five or more years at a time.

Wright, who headed the Federal Highway Administration under former President George W. Bush, worries that, in the current political environment, it's becoming increasingly difficult for states to initiate the sorts of big build-outs needed to keep up with future growth.

"The big vision kinds of projects that typically would require the accumulation of funds over multiple years are very hard to take on right now because states can't be sure that those dollars are going to be there some time in the future," Wright said. "Only the very optimistic would see a substantial increase in funding over this next period of years."