The latest take on the state of the federal Highway Trust Fund issued by the Congressional Budget Office (CBO) is brightly lit by a yellow caution light.
To avert a massive shortfall come 2015, CBO contends that Congress will have to sharply cut highway spending, transfer $14 billion from the Treasury’s general fund, pump up the federal fuel tax by some 10 cents a gallon, or deploy some combination of the three measures.
A Statement for the Record provided yesterday by Sarah Puro, CBO’s Analyst for Surface Transportation Programs, to the House Committee on the Budget lays out the Office’s projections of future spending from the Highway Trust Fund and its estimates of the excise taxes that will be credited to the fund.
In the statement, Puro clearly spelled out where CBO sees the Highway Trust fund headed and suggested what action Congress could take to keep surface transportation spending out of the weeds:
· “The current trajectory of the Highway Trust Fund is unsustainable. Starting in fiscal year 2015, the trust fund will have insufficient amounts to meet all of its obligations, resulting in steadily accumulating shortfalls.”
· “Since 2008, the Congress has avoided such shortfalls by transferring $41 billion from the general fund of the Treasury to the Highway Trust Fund. An additional transfer of $12.6 billion is authorized for 2014. If lawmakers chose to continue such transfers, they would have to transfer an additional $14 billion to prevent a projected shortfall in 2015.”
· “Lawmakers could also address that shortfall by substantially reducing spending for surface transportation programs, by boosting revenues, or by adopting some combination of the two. Bringing the trust fund into balance in 2015 would require cutting the authority to obligate funds in that year from about $51 billion projected under current law to about $4 billion, raising the taxes on motor fuels by about 10 cents per gallon, or undertaking some combination of those options.”
Fair warning: Reauthorization of surface-transportation funding— and the high-stakes political brawling it will spawn— is due again in “just” 527 days.