When Congress agreed to finance the Interstate Highway System in 1956 by dedicating taxes on gasoline, tires, autos, and trucks to a Highway Trust Fund, it also adopted a policy of not spending more from the fund that was actually collected in highway fees into that fund. This delayed completion of the interstate highways because inflation increased costs without increasing gas taxes and other revenues, but it ensured that the fund remained solvent.
Congress dipped into the Highway Trust Fund to give the Antiplanner’s favorite airline, Alaska, $500,000 to paint a salmon on a plane. Is it any wonder the Trust Fund is insolvent? Photo by Cubbie_n_Vegas.
That is no longer the case, and today Congress spends about $14 billion more per year out of the fund than it collects in highway user fees. Yesterday, the Senate Environment and Public Works Committee held a hearing on the “long-term solvency of the highway trust fund.” Most of the witnesses at the hearing spoke about problems with gasoline taxes and why they should be replaced with mileage-based user fees. Continue reading
