The Road to Better Roads Runs Through Washington

By April 29, 2014 August 27th, 2015 Government, Logistics, NationaLease

CapitolBuildingIn a normally charged political climate, four senators pledge to work together to develop a long-term highway bill.

No one disputes that our highways need upgrades and repair, but here’s some sweat-inducing news. The Highway Trust Fund is due to be insolvent by later this year. As of March 28 of this year, the Highway Account cash balance was only $8.4 billion. If funds aren’t replenished soon, there is a possibility that the Fund will be out of money by August of this year. This could easily mean a slowdown in much-needed construction projects.

In fact, the concern and uncertainty over funding has already caused officials in Arkansas, California, and Colorado to consider delaying planned projects. And keeping the funding guessing game going “ad nauseum” prevents many states from moving ahead with years-long projects that ultimately will help states’ economies by increasing jobs and therefore tax revenues.

To avoid this situation, some senators are working across party lines to put together a six-year transportation bill that will use tax reform to pay for highways and restore the Highway Trust Fund solvency. David Vitter (R-LA), Barbara Boxer (D-CA), Tom Carper (D-DE), and John Barrasso (R-WY) are the four senators committed to work in a bipartisan fashion to make this come to pass. But although these four senators and a broad range of other politicians agree that something needs to be done, the issue is, as always, how to pay for it.

For the most part, the consensus seems to be that the money should come from tax reform, rather than from shifting funds from one piece of legislation to another. But with movement on tax reform slowing down, and with the mid-term elections causing glacial movement in the Congress, this seems highly unlikely. The “worst-case” scenario would be to funnel general funds to plug the trust fund gaps, but a long-term solution must be found.

Do you think a solution will be found before it’s too late? Probably, but will it be the right solution or just another band-aid? Time will tell.

David Beaudry

About David Beaudry

David Beaudry is Director of Logistics Engineering and Consulting for NationaLease. He brings 25 years experience in surface transportation, logistics engineering, and consulting. His earlier career includes management posts with Ryder System Inc. and National Freight. He holds a Bachelor of Science degree from Central Connecticut State.

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