Construction industry representatives want every penny of a proposed federal tax on carbon producers to go to the Highway Trust Fund.
The federal government needs $76.1 billion in annual highway spending until 2026 to maintain national highways and eliminate a backlog of road and bridge projects, according to a study conducted by the U.S. Department of Transportation.
The draft bill would levy annual taxes, called “allowances,” on companies and utilities that produce fuels or emit carbon from their facilities. The new fees, which would vary year to year, would give $6.25 billion to federal transportation planning and construction while also supporting clean energy research and energy efficiency grants, among other programs.
The money for the Highway Trust Fund represents a small share of that raised through the new system, said Brian Turmail, spokesman for the Associated General Contractors of America. He said drivers ultimately would pay the tax when buying gas, so all the money should go to road projects.
“Any time you take money out of transportation and spend it elsewhere,” he said, “you are robbing funds from our underfunded transportation system.”
Highways should get some, but not all, of the money, said Steven Nadel, executive director for the American Council for an Energy-Efficient Economy. It is appropriate to spend the money on developing new energy technology, he said, because those programs would make it cheaper to build and buy power from renewable energy systems.
Nadel said the bill would stop giving money to research and development in 2021, a deadline he wants extended by 10 years.
“While I wish we could take care of all of our research and development needs by 2021,” he said, “I doubt it will. So my question is: Why would it end?”
Tony Dorsey, spokesman for the American Association of State Highway and Transportation Officials, said not only would the bill shortchange the industry, but it would set too many restrictions.
“The Highway Trust Fund is in trouble now,” he said, “and it needs additional revenue, and we need the revenue from the sale of those allowances to go into the Highway Trust Fund without any strings attached.”
The draft bill proposes $2.5 billion for projects to improve transportation safety and efficiency, $1.875 billion in federal grants for state and local governments and $1.875 billion for transportation planning.
All of those restrictions will make reducing car emissions a bigger goal in transportation planning, said Therese Langer, transportation project director for American Council for an Energy-Efficient Economy. She said setting aside the money for that goal justifies the use of the tax for road and transit projects and would result in more spending on transit and less on road expansion.
Langer said the rules guiding use of the money would not stifle improvements for highways and bridges.
“We’re all in favor of projects that can make the system more efficient, and we’re certainly in favor of keeping the state of roads and bridges in good repair,” she said. “But, historically, the way transportation planning has been, there is a tension between trying to keep the system efficient and energy efficient and the perceived need to keep expanding.”
Turmail said the ultimate cost increase at the pump would only make it more difficult to raise money specifically for highways.
“That small amount of money dedicated to it,” Turmail said, “will simply go a long way to increasing the skepticism among Americans to invest in our transportation system.”