Lawmakers Ponder Pumping Up Gas Tax

House Transportation Committee leaders are thinking about increasing the federal gas tax to sustain the nation’s deteriorating highways, but others in the House say that’s unlikely with gas prices at near-record highs.

Transportation Committee Chairman Don Young, R-Alaska, and top Democratic member James Oberstar, of Minnesota, say they need $ 375 billion over the next six years just to maintain and make some improvements to the highway system.

They have asked for $$ @50 billion for the 2004 budget year for highway and transit programs, compared with the $$ @36.5 billion President Bush proposed.

“The economy cannot continue to grow without a transportation system that moves people and goods efficiently,” Young told the House Budget Committee last week. He added that there is no longer a choice between raising or not raising more revenues. “Rather, our choice is between different methods of adjusting them.”

One method being mulled is indexing the gas tax for inflation, retroactive to the last change in 1993. That would boost the federal tax, currently 18.4 cents per gallon, by about 5.4 cents. State gas taxes average an additional 22 cents per gallon.

Other possibilities are raising the per-gallon tax two cents each year through 2009 or taxing ethanol at the same rate as gasoline. Still another possibility is stopping the practice of transferring interest from the highway trust fund – money from the gas tax dedicated to highway programs – to the general Treasury fund.

The current six-year highway program, which expires this year, was funded at $$ @218 billion, but lawmakers say that spending level falls far short of current needs.

A letter to the Budget Committee signed by 74 of the 75 Transportation Committee members cited a Transportation Department report estimating it would require $$ @53 billion per year just to keep highways and transit systems in their current conditions. About $$ @75 billion per year would be needed to improve highway safety and reduce congestion.

The only member not to sign was Rep. Jim DeMint, R-S.C. An aide to DeMint, who plans a Senate race next year, said the congressman opposed a tax increase to pay for the jump in spending.

Oberstar, in promoting more highway spending to the Budget Committee, said traffic congestion costs the nation close to $$ @100 billion per year. He also said there are now 750,000 unemployed construction workers, up 42 percent from two years ago, and that every $$ @1 billion of federal highway spending creates 47,500 jobs.

But Republican leadership aides said the idea of a gas-tax increase was not going to fly in a GOP-led Congress trying to cut taxes and in an environment where fuel prices are soaring. The Energy Department predicted Thursday that pump prices would reach a record national high of $$ @1.76 per gallon in April.

Wayne Brough, chief economist for the conservative Citizens for a Sound Economy, said talk of a gas-tax increase “is ill-timed at best.”

“A new gas tax does nothing to renew fiscal discipline,” he said in a statement. “Rather, it encourages the status quo by ignoring the need to establish new priorities with respect to federal spending.”