In a new column Reason’s Shirley Ybarra, former transportation secretary in Virginia, writes:
In order to save the federal transportation funding program from bankruptcy, Congress has passed an $8 billion stopgap measure. Congress hopes the money will keep the funding mechanism (called the transportation trust fund) alive until September 30, 2009, when the next long-term transportation funding bill is scheduled to be passed. However, not everyone is certain that the infusion of cash will last until next September. And if history is any indicator, the money might need to last even longer because Congress won’t pass the transportation reauthorization bill on time – it has never passed one on time before. State transportation trust funds are under severe pressure as well. Almost every state’s transportation trust fund is predominantly financed with gas tax revenues, which have been declining due to higher gas prices, less driving and people driving more fuel efficient vehicles. In the face of financial uncertainty at both the federal and state levels, it is no wonder that most state transportation departments will be forced to make cautious decisions about their future projects. They simply don’t know how much money they’ll have. In addition, many states are facing budget deficits. California’s deficit is $15 billion, for example. As governors prepare budgets, they should propose budget cuts and cost-saving measures. States will also likely “borrow” money from their transportation trust funds in order to make ends meet elsewhere. “Borrowing” is effectively an additional transportation budget cut that will cause major infrastructure projects to be further delayed.
Full Column Reason Foundation’s Transportation Research and Commentary