Funding levels could go down

With MAP-21 expiring in September, several critical issues are on the table.

Aside from expected challenges and delays—SAFETEA-LU meandered through 10 extensions for almost three years before becoming law—there’s the Highway Trust Fund, which funds part of the surface transportation program via a per-gallon tax on gasoline and diesel fuel that’s been 18.5 cents since 1993.

Noting that the nation requires $16.3 billion annually to preserve the current transportation program, U.S. Transportation Secretary Anthony Foxx recently revealed, “The fund is on track to bounce checks before FY 2015, as soon as this August.”

With the national debt creeping toward $18 trillion and a federal deficit of $744 billion, it’s unlikely that legislators will raise the tax or approve other funding mechanisms. Extensive debate over the next package could lead to no increase or even cuts to highway programs.

In the meantime, pavements and bridge decks continue to erode, and state and local governments are still recovering from the Great Recession.

“It’s a challenge for local governments to maintain highway and bridge expenditures in an economic downturn, especially when many are dependent on general fund revenues for transportation investment,” says American Road & Transportation Builders Association Vice President and Chief Economist Alison Premo Black. “Thus, even status quo federal funding continues to be a very important part of the market.”

Next Page: Where to go from here