TIME IS RUNNING OUT (AND SO IS THE MONEY)

As October 1 approaches, most supply chain eyes will be turned toward Washington to see what Congress does about the transportation spending bill scheduled to expire on that date. By now, most of us are aware of our deteriorating infrastructure and the billions of dollars it will take to bring highways and bridges up to acceptable standards. Last weeks’ Time Magazine estimated that 252 million vehicles move across structurally deficient bridges each day and that it would take $106 billion just to repair those bridges – not to mention the additional tens of billions it would take to repair and/or replace highways. While many members of Congress are aware of the problem, not one of them has the foggiest notion of where the necessary funds would come from.

The fuel tax is the primary source of revenue for the Highway Trust Fund, but the $.184 per gallon tax on gasoline and the $.244 on diesel fuel have not been increased since 1993. By the time you read this, we will be only weeks away from a totally depleted fund.

Historically, consideration of an increase in this tax has created a political firestorm that most members of Congress quickly distanced themselves from. But last week, in a rare burst of bipartisan cooperation, Senators Bob Corker, R-Tennessee and Chris Murphy, D –Connecticut, introduced a bill that would increase fuel taxes by $.12 per gallon, over the next two years. The U.S. Chamber of Commerce has long been on record in favor of an increased tax; and the American Trucking Associations, and such highway users as FedEx and UPS have indicated their support of the new legislation. The latter is particularly significant in that combined, these two firms log about 3 billion miles annually.

The larger question is whether members of Congress will support it. The November election is just around the corner, and in some areas will be hotly contested. Passing a new, controversial transportation funding bill is simply not likely to happen before the election. I believe Congress will take the easy way out and extend the current MAP-21 legislation until after the election and supplement the highway trust fund from the general fund as they have done so often in the past. In the meantime, we will continue to deal with a problem that has been ignored for far too many years.

Written By: Clifford F. Lynch