Reduce restrictions on the creation of new toll roads and actively encourage more public-private partnerships, urge the authors of the final report to Congress by the National Surface Transportation Infrastructure Financing Commission.

Released this morning, the report is the result of two years of work by the commission, which was charged with analyzing highway needs and making recommendations regarding federal financing of transportation infrastructure. It addresses the need to reallocate the Highway Trust Fund authorizations, the surface transportation law that expires Sept. 30.

The report includes nearly a dozen short-term recommendations (including an increase in the federal gas tax) as well as several long-term recommendations (including a system that charges motorists for their usage of the nation's roads based on vehicle miles traveled, or VMT).

"The biggest problem we have is that we're doing a reasonably decent job of maintaining our system, but we're completely failing in improving the system," says Geoffrey S. Yarema, one of the 15 members of the federal commission. "Large capital projects are being deferred indefinitely in many cases. We're going to increase amount of money that will be apportioned to states on an annual basis (to be allocated for both capital expenditures and maintenance expenditures), but we also want to give states money for new projects."

Although the proposed gas tax hike and the federal mileage-based system are likely to draw the biggest criticism from the public, the recommendations are designed to help infrastructure managers at both the state and local levels by allowing them to raise their share of revenues from the usage of state and local roads as well.

"The technology we anticipate for this system is going to be very robust," Yarema says of the proposed VMT system. "Among the capabilities will be to allow state and local governmental units to piggyback on it cost-effectively, but there needs to be a mechanism to adjust for inflation and in a depoliticized way. Requiring state and local governments to come up with their own systems gives them as much flexibility as we can."

Yet the commission doesn't stop there with its recommendations.

"With the expected shift to more fuel efficient vehicles," says commission Chair Robert Atkinson, "it will be increasingly difficult to rely on the gas tax to raise the funds needed to improve, let alone maintain, our nation's surface transportation infrastructure."

Among the other options available to states and local governments would be easier and quicker ways to raise necessary funds for toll roads and the ability to charge premiums for rush-hour travel on major metropolitan highways. The commission is recommending that Congress reauthorize the federal credit program for surface transportation commonly known as TIFIA (Transportation Infrastructure Financing and Innovation Act of 1998).

"It's very difficult getting initial funding for the planning and design process of capital projects," Yarema tells PUBLIC WORKS. The commission is proposing a new $1 billion-a-year incentive program by which state and local governments would apply to the U.S. Department of Transportation on a competitive basis for up to 50% of the initial funding needs.

The commission is recommending:

  • a $100 million annual grant program to provide funding for a portion of the costs incurred during the planning process of toll roads or other transportation infrastructure funded by users,
  • a $600 million annual grant program to offset the gap between capital costs and future revenues from user fees, and
  • $300 million in annual budget authority for credit assistance.