As the Highway Trust Fund's highway account heads toward a deficit late next year, the U.S. Dept. of Transportation's new secretary, Anthony Foxx, says resources such as DOT's expanded loan program and President Obama's proposed infrastructure bank can give the unsteady fund some support. But Foxx also says they won't eliminate the funding gap.
Foxx, sworn in as secretary on July 2, dodged a question about hiking the federal motor-fuels tax. The White House and some congressional leaders have opposed increasing that levy. He said the gas tax must be part of a transportation "dialogue" with Congress.
"I think we have to have a very vigorous discussion between the administration and our leaders on Capitol Hill about how to move forward," he said.
Foxx, a former Charlotte, N.C., mayor, says public-private partnerships should be part of the mix and notes that states and localities are using tolls and finding revenue from development near highways, transit lines and stations. But he says not all projects will attract investors. "There are some that are just public-good projects that don't spin off revenue," which wouldn't interest the private sector, Foxx observes. What's needed, he says, is a "both-and" finance approach, not an "either-or" plan.
Two days before Foxx's briefing, Obama visited Chattanooga, Tenn., and called for more infrastructure funding. "We've got about $2 trillion of deferred maintenance here in this country," he said. "So, let's put more construction workers back on the job doing the work America needs done."
Part of Obama's proposal would be to set a new minimum tax on U.S. firms' overseas income and use some of those tax proceeds for infrastructure. But top congressional Republicans dismissed the idea. Senate Minority Leader Mitch McConnell (R-Ky.) said the tax increase "is going to dampen any boost businesses might otherwise get to help our economy."
Brian Turmail, Associated General Contractors of America spokesman, says, "Clearly, the secretary is recognizing the reality of the situation"—that is, that TIFIA and other sources can help, especially on large projects, and the trust-fund shortfall needs to be addressed. Turmail adds, "There, of course, we get a little bit frustrated because [administration officials] understand the challenge but have yet to come up with a suggestion for how to address the Highway Trust Fund in a long-term way."
Pam Whitted, National Stone, Sand & Gravel Association senior vice president for legislative and regulatory affairs, says she is encouraged by Foxx's comments, but she adds, "I'd like to see the administration step out front and lead on the reauthorization effort."