How healthy is the Highway Trust Fund? It depends when you asked. The U.S. Dept. of Transportation’s late August projection showed that the fund’s highway account would stay out of the red through next June.
But DOT's Sept. 16 update paints a darker picture, showing that the account will run into trouble in November.
The fund’s condition affects the flow of highway projects and has an impact on Congress. Lawmakers must act soon to at least extend highway and transit operations past Oct. 30, when the when the latest of many extensions expires. That stopgap mandated an $8-billion shift from the general fund to the trust fund, keeping the highway account from plunging into a deficit in August.
Transportation Secretary Anthony Foxx maintains that the trust fund remains in dire shape. Foxx said in a blog post, “The latest transfer from the General Fund keeps the [highway] account’s cash balance above the prudent level of $4 billion, but only until November 2015.”
The Sept. 16 update projects that the highway account will slip to $3.9 billion in November, rise to $4.7 billion in early December and hover between $3.8 billion and $4.9 billion through May. “It’s going to run right on the edge,” says one industry source.
Jay Hansen, National Asphalt Pavement Association executive vice president, “We’re at that stage where it just really depends on how the market goes.” He adds, “If it’s a mild winter and projects are perking along and spending out, it’s going to reach zero sooner.”
Pam Whitted, National Stone, Sand and Gravel Association senior vice president for legislative and regulatory affairs, agrees the trust fund’s is in weak shape. She says, “The outlays aren’t going out as fast because states aren’t spending money, because of the uncertainty about where the federal funding is going to come from or if [a new bill is] going to be passed.”
Whitted adds, “We need a multi-year bill, a six-year bill, that increases funding into the Highway Trust Fund.”
Construction industry officials pushing for a long-term transportation bill got a lift in July when the Senate passed a six-year authorization, though with just three years of funding. But DOT’s August projection “definitely took some wind out of the sails,” says Hansen.