Tolling For The Future - Washington Insider
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Tolling For The Future


Article Date: 07-01-2005
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.

It's closer than you think.

As I write this, the TEA-21 reauthorization process seems to be wrapping up. All signs suggest that a new surface transportation law with moderate spending increases will be in place by midsummer. However, behind the renewed optimism about near-term prospects for the highway program lurks the realization that existing Highway Trust Fund revenue streams will be insufficient to support America's real future infrastructure needs.

During this past reauthorization process, lawmakers demonstrated a lack of political will to raise highway user fees to pay for much-needed infrastructure investment. Highway advocates recognize that this summer's transportation law will likely be the last to rely so heavily on the gas tax. Many in the nation's capital are already working on ideas about how to pay for the highway program of tomorrow.

My last column took a look at Sen. Jim Talent's (R-MO) proposal to increase transportation infrastructure investment using Build America Bonds, a plan that's won widespread support in the construction industry. This month I look at a more controversial concept by Reps. Mark Kennedy (R-MN) and Adam Smith (D-WA), and Sen. Wayne Allard (R-CO) to raise additional highway dollars through tolls.

Under the Kennedy-Smith-Allard "Freeing Alternatives for Speedy Transportation" (FAST) bill, states could expand the use of tolling to build new infrastructure, but there would be important limits on this new power. First, tolling could only be used to finance the construction of new highway lanes (in other words, the money raised could not be used for unrelated projects). Second, to ensure that the plan would reduce, not add to traffic congestion, tolling would only be
permitted if the fees were collected using non-cash, electronic technology like the Smart Tag, FasToll, and E-ZPass systems.

Third, the use of FAST lanes would have to be voluntary: Drivers could still opt to drive in existing non-toll lanes along the same corridor. Fourth, once a project is completed and paid for, no additional tolls could be collected. And, finally, money collected by states under the FAST bill would not count against the state's share of federal highway allocations.

Tolls have long been a subject of controversy in the highway community. Because infrastructure investment is supported by highway user fees, tolls are generally regarded as double taxation. As a result, groups like AAA and the American Trucking Associations (ATA) have vigorously opposed tolling plans. However, FAST is different. Because it strictly limits the use of tolls and takes a distinctly free-market approach, it passed muster with a number of traditionally anti-toll groups.

But that's not to say everyone has jumped on board. The House rejected FAST during the most recent highway reauthorization debate. Environmentalists and state highway officials were concerned it would prevent the use of money raised from tolls for transit and other "congestion mitigation" activities. Some Democrats opposed it on the grounds that it would create "Lexus lanes" for wealthier commuters and leave less well off drivers stuck in traffic.

Construction industry groups expressed concerns about FAST's "all or nothing" approach to tolling. Because it would have superseded existing toll collection initiatives, FAST could potentially have been as much a step backward for infrastructure investment as a step forward.

As this issue goes to press, the highway reauthorization debate is in its final stages. Although the House bill did not include FAST, some elements of it were incorporated into the Senate's version of the legislation, raising the possibility that at least part of the proposal might be enacted into law this year.

Speaking to equipment industry leaders at the 2005 AED Government Affairs Conference, Kennedy said that, "The conventional wisdom is that there is a shortage of resources to invest in our highways and transportation infrastructure. I don't believe that. It's a shortage of innovation."

Whether Congress ultimately adopts FAST or a similar proposal this year, Kennedy, Smith, and Allard are to be commended for their innovation and for at least trying to get lawmakers focused on how to pay for the highway program of tomorrow. It's critical that they do, because tomorrow is closer than they think.

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Article Categories:  Public Policy