Statement of Senator Carl Levin on the Safe, Accountable, Flexible, and Efficient Transportation Equity Act of 2005

Mr. President, funding for transportation infrastructure such as roads, bridges and border crossings is a sound investment that increases the mobility of people and goods, enhances economic competitiveness, reduces traffic congestion, and improves air quality. Those improvements in transportation infrastructure are critical to our states, and the federal highway money that states receive is critical for funding them. In addition, few federal investments have as large and immediate an impact on job creation and economic growth as transportation infrastructure. The Department of Transportation estimates that every $1 billion in new federal investment creates more than 47,500 jobs.

Unfortunately, the formula that distributes federal highway funds to states is antiquated and inequitable. Historically, about 20 states, including Michigan, have been “donor” states, sending more gas tax dollars to the Highway Trust Fund in Washington than are returned in transportation infrastructure spending. The remaining 30 states, known as “donee” states, have received more transportation funding than they paid into the Highway Trust Fund.

This unfair practice began in 1956 when small states and large Western states banded together to develop a formula for distributing federal highway dollars that advantaged themselves over the remaining states. Once that formula was in place, they have tenaciously defended it.

At the beginning, there was some legitimacy to the concept that large, low-population, and predominately Western states need to get more funds than they contributed to the system. It was the only way that we could build a national interstate highway system. However, there is no justification today for any state getting more than its fair share. With the national interstate system completed, the formulas used to determine how much a state will receive from the Highway Trust are simply unfair. Each time the highway bill has been reauthorized, I, along with my colleagues from other the donor states, have fought to correct this inequity in highway funding. Through these battles, some progress has been made. For instance, in 1978, Michigan was getting around 75 cents back on our federal gas tax dollar. The 1991 bill brought us up to approximately 80 cents per dollar, and the 1998 bill guaranteed a 90.5-cent minimum return for each state.

Last year, we believed we had another significant victory when the Senate passed a bill that would have given donor states 95 cents on the dollar in the final year of the bill. Unfortunately, that bill died in conference due to the president’s veto threat and his unwillingness to accept the funding levels in either the House or Senate bill.

This year’s legislation, however, would give donor states just 92 percent of their Highway Trust Fund contributions by 2009. Although that is a small step in the right direction of closing the equity gap, we still have a long way to go to achieve fairness for Michigan and other donor states.

This bill is also a setback from last year’s bill because it provides fewer overall transportation dollars. Last year, the Senate wisely passed a bill that would have pumped $318 billion into our transportation systems over 6 years. This year, the Senate has reduced that funding down to $295 billion. That is more than the House passed bill of $284 billion but still less than what is needed.

Michigan’s rate of return would go from 90.5 percent to 92 percent immediately and remain at 92 percent for the full five years of this bill. Under this bill Michigan would get an annual average funding level of $1.134 billion which represents a 28% gain over TEA-21.

Mr. President, we have made progress in this bill compared to current law in the ongoing fight for equity for donor states. I will continue to fight in the future, as I have in the past, looking toward full equity for Michigan. I recognize, however, that we have reduced the inequity a little more in each previous reauthorization bill, and we do so in this bill as well. This bill will bring billions of desperately needed dollars to states across the country. It will improve our Nation’s transportation infrastructure and create millions of American jobs, and therefore I will support it, although its steps toward equity and fairness are very tiny indeed.