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How Should States Prepare for a Shortfall? How Should States Prepare for a Shortfall?

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Transportation Insiders

How Should States Prepare for a Shortfall?

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States could assume more responsibility for roads as federal funding dries up. Photo by Kevork Djansezian/Getty Images

The highway trust fund is shrinking fast. Congress is looking for new sources of funding before the money runs out in August. Progress is slow, but ideas are circulating. Lawmakers will probably come up with a short-term patch in July, and there is talk of lame-duck negotiations for longer-term funding for the nation's roads, bridges, and transit.

None of this is certain. It's hard to see how policymakers get to a short-term or long-term solution without a breakthrough in their opinions' about the cutting the U.S. Postal Service, overseas tax breaks, or the Transportation Department's popular TIGER grant program. All of those ideas are in the mix to pay for reviving the highway trust fund. None of them have enough champions to make it across the finish line.

 

So what do the states do while they're watching this stalemate? According to the Wall Street Journal, Arkansas will put off replacing a bridge that dates back to the 1930s. Missouri's state Legislature is asking voters to weigh in on a sales tax increase to pay for infrastructure. Transportation for America, which advocates for increased infrastructure spending, recently pointed out that seven states have done the "unthinkable" in the past two years by raising gas or other taxes to fund transportation. Tax increases, it would seem, are easier to impose at the state level.

Some conservatives say cutting off federal highway funding is just what the states need to get them to take care of their own problems. "The states will not sit idly by" as the money dries up, wrote Heritage Foundation policy analyst Emily Goff. "The states have a great stake in having sufficient and efficient transportation infrastructure and indeed are already assuming more leadership in funding and financing their projects."

With last week's downfall of House Majority Leader Eric Cantor, a veteran lawmaker who is sympathetic to transportation interests, Goff's point of view could be gaining traction. Cantor's upset loss in his Virginia primary election was seen by many hardcore conservatives as signal that they should push harder to dramatically reduce the federal role in everything, transportation included.

 

States, get ready.

For our insiders: What can the states do to prepare for a decrease, or total cutoff, in federal transportation funding? Are there other projects, like the Arkansas bridge, that will be delayed or halted? Are states in a better position to raise taxes than the federal government? Should they? Is the role of the states in transportation about get even bigger than it already is?

(Note: This is a moderated blog on transportation issues. Comments are approved on a case-by-case basis. Contact me if you want to become a regular commenter.)

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