Two Years Better for Transportation

Lost in the shuffle around the House’s vote on the FY2012 budget last week was a hearing on the future of the federal transportation program. Nevertheless, both discussions centered on a common theme as articulated by Senator Max Baucus: “We don’t have a lot of money here.”

The related question, the senator wondered aloud, is whether it makes sense for Congress to continue to push for a six-year transportation law, which would spread the limited amount of funding across those years very thinly. A shorter two-year bill, on the other hand, would prevent a huge drop in annual funding.

It is a good idea and one we promoted once it became clear that the requisite funds needed for a robust six-year law are not coming anytime soon. Any hopes for a gas tax increase to raise the money seem to have disappeared with gas prices expected to crest this summer over $4 per gallon.

The two-year idea would also provide greater certainty to states and metro areas than simply “extending” the current law for indeterminate lengths. Transportation agencies need to make hiring and equipment purchasing decisions for multi-year projects which is difficult to do in an unpredictable congressional environment. In exchange, a two-year law should put in key reforms–federal performance measures in safety and system-wide asset management; a new partnership with metro areas that raise their own revenue that reduces bureaucracy and accelerates project delivery; better coordination of existing federal credit assistance programs such as TIFIA–that have broad support and don’t add measurably to the overall size of the program. We discuss a number of key reforms here.

Such an authorization would avoid the current political rancor and the challenges of discussing a necessary increase in the federal gasoline tax during the presidential election campaign in 2012. There is the added hope that the national economy will have recovered sufficiently by then to make such a conversation possible.