Senate Finance Committee Chairman Max Baucus (D-Mont.) will play a critical role in the next surface transportation bill, because his panel oversees the major federal funding source for highways and transit, the financially struggling Highway Trust Fund.

At a May 17 hearing of his committee, Baucus noted the trust fund's expected late 2012 shortfall
and said he was looking for creative ways to deal with surface transportation financing.

He said the Finance panel "has already started to think creatively," studying such things as public-private partnerships, infrastructure bonds and a national infrastructure authority, an idea recently proposed by Sens. John Kerry (D-Mass.) and Kay Bailey Hutchison (R-Texas).

"All options should be on the table," Baucus said.

(View statements by Baucus, Sen. Orrin Hatch and witnesses who testified at the hearing.)

Among the witnesses at the hearing was former Pennsylvania Gov. Edward Rendell (D).  Rendell, co-chair of the infrastructure-advocacy group Building America's Future, laid out hs short list. It includes broader authority for tolls on existing federally funded highways, tapping the private sector for investments; bonds; expanding Transportation Infrastructure Finance and Innovation Act loans; launching an infrastructure bank; and expediting projects by shortening the time for environmental reviews.

But a senior Finance Committee Republican, Orrin Hatch of Utah, emphasized the GOP's tough fiscal line. Hatch said, "We need to look beyond simply putting more money into a leaky and broken down Highway Trust Fund or hiding the rusted--out shell of the trust fund among other financing vehicles that appear to be in better shape."

Joseph Kile, the Congressional Budget Office's assistant director for microeconomic studies, spelled out the trust fund's woes.

Kile said CBO's projections show the fund's highway account would show a shortfall towards the end of fiscal 2012--which ends Sept. 30 of that year--or early in FY 2013.

The trust fund has limped through the past couple of years only because of transfers from the general fund totaling about $34.5 billion since 2008.

Hatch's comment indicates skepticism about further general-fund transfers to the trust fund.

An increase in the 18.4-cent-per-gallon federal gasoline tax of course would bolster the trust fund, but lawmakers from both parties--and the White House--have ruled out a gas-tax hike.