The American Trucking Associations (ATA) urges a federal fuel tax increase to pay for infrastructure improvements, but ATA President Chris Spear sees that approach evolving in the next decade.
“I would be the first to say that the fuel tax is not sustainable long-term,” Spear said in an October 5 interview with FreightWaves at the ATA Management Conference & Exhibition in San Diego.
But the long-term is the next decade, not today.
“There is no other alternative to recover the money required for the next 10 years,” Spear said. “The fuel tax is without question the most efficient, immediate (and) conservative way to fund infrastructure.”
State of play
The ATA, which represents 30,000 motor carriers, backs studies that show tens of billions of dollars in economic loss to the trucking industry. Drivers who haul 71% of the nation’s freight endure hundreds of thousands of hours of congestion delays worsened by dilapidated roads and bridges.
The association proposes a five-cents-per-year increase in the federal fuel tax for the next four years, which would raise $340 billion for the nearly bankrupt Highway Trust Fund. Because the fuel tax is already in place, the ATA claims it would cost less than a penny per gallon to administer.
“Getting a well-funded infrastructure bill passed takes resolve,” Spear told members in his state-of-the-industry speech at the conference. “To succeed, we have to call out anyone who thinks fake funding, like tolling existing roads and bridges, is in our nation’s best interests.”
The ATA plan, which Spear predicted would gain Congressional and White House support in 2019, is sidelined by partisan bickering in Washington, D.C. President Donald Trump campaigned on a $1 trillion infrastructure plan that was raised to $2 trillion in talks with Congressional Democrats in late April.
Three weeks later, according to media reports, Trump angrily walked out of a follow-up meeting at the White House, insisting he would not work with Democrats unless they abandon their inquiries into his businesses, presidency and personal finances.
“It was frustrating,” Spear told FreightWaves. “I understood it. I think it was a marker. Dialog may not be in front of the camera, but it has continued.”
Spear said reauthorization of a multi-year federal transportation bill next year appears more likely than Congress passing a plan for roads, bridges, railroads and broadband internet.
“It may not be the $2 trillion in (Senate Majority Leader) Mitch McConnell’s mind. He may just do the reauthorization. We’ll take that. That’s a good step.”
To Spear, Congressional leaders who complain that President Trump would take credit if Congress passes a massive infrastructure plan are missing an opportunity.
“He’s the president. Of course, he’s going to take credit for it,” Spear said. “The House majority needs to step up and take credit for its work. And if they both do it, it’s a wash.”
The same logic, he said, applies to members of Congress in the 27 states that have raised fuel taxes since 2013.
“If they would do their job in Washington nationally, their states wouldn’t have to do it,” Spear said. “And for those that did out of an inability to wait any longer to fund infrastructure, they can go back and lower those state taxes.”
As trucks move to greater use of electricity and alternatives to diesel fuel such as compressed natural gas and hydrogen, a new way to raise money will be needed, Spear said. That could be a tax on vehicle miles traveled, or VMT.
“A lot of people talk about VMT. Whether or not that is [the answer], I don’t know,” he said. “We as an industry have a responsibility to be discussing during the next 10-year span what the future revenue sources could and should be.”
The ATA long has supported the concept that users pay for the roads on which they travel. Privacy concerns and cybersecurity also must be considered.
“In 10 years, that will be more of an issue,” Spear said. “Our association moving away from the fuel tax for the next 10 years is a sign that we recognize that and we’re willing to sit down and have that discussion.”