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On The Floor  »  The Highway Trust Fund Restoration Act

The Highway Trust Fund Restoration Act

On July 23, 2008, the House passed the Highway Trust Fund Restoration Act, H.R. 6532.  This critical legislation is needed to address a projected shortfall in the Highway Trust Fund and help achieve the funding levels for highways and public transportation authorized by SAFETEA-LU of 2005. The bill was signed into law on September 15, 2008.

SAFETEA-LU authorizes $41.2 billion for Federal-aid highways and $10.34 billion for public transportation in FY 2009.  Unfortunately, Highway Trust Fund revenues are falling behind what was anticipated when SAFETEA-LU was enacted in 2005.  

If this situation is not addressed, the American Association of State Highway and Transportation Officials (AASHTO) has estimated that the shortfall could lead to a devastating $14 billion, or 34 percent, reduction in federal highway investment in FY 2009.

A 34 percent cut in each state’s federal highway funds would lead to the loss of nearly 380,000 jobs at a time when we are attempting to revive the U.S. economy. 

This bill restores $8.017 billion in highway-user taxes to the Highway Trust Fund that were transferred from the Highway Trust Fund to the General Fund in 1998 as part of an overall deficit reduction deal.  

Working to honor the investment levels contained in SAFETEA-LU will enable us to continue our efforts to develop an efficient transportation network that enhances the nation’s long-term productivity.

Both the Congressional Budget Office and the Joint Committee on Taxation have determined that this legislation does not constitute a spending outlay, would not violate PAY-GO rules, and will have no revenue effect.

Overview of the bill's key provisions and why the bill is so critical:

The bill restores $8.017 billion to the Highway Trust Fund.  The bill restores $8.017 billion in highway-user taxes to the Highway Trust Fund that were transferred from the Trust Fund in 1998.  Specifically, in 1998, in response to concerns that the Highway Account’s $16.5 billion balance was too large, Congress transferred more than $8 billion from the Highway Trust Fund to the General Fund.  Now that the Highway Trust Fund faces major shortfalls in 2009 and beyond, Congress should restore this $8 billion.

Without this bill, forecasts indicate a major shortfall in the Highway Trust Fund in FY 2009.  Forecasts indicate a shortfall of several billion dollars to the Highway Trust Fund in FY 2009, the last year of the SAFETEA-LU authorization.  In addition, the Federal Highway Administration recently reported that estimated miles traveled on U.S. public roads dropped 11 billion miles between March 2007 and March 2008, the first year-to-year reduction since 1979.  As Americans drive less and purchase less fuel, the Highway Trust Fund’s shortfall will continue to worsen.

Failing to enact this bill could trigger funding cuts in federal highway funds to states of about 34 percent.  According to the American Association of State Highway and Transportation Officials (AASHTO), failing to enact this bill could lead to a devastating $14 billion, or 34 percent, reduction in federal highway investment in FY 2009.  A 34 percent cut in each state’s highway funds would lead to the loss of nearly 380,000 jobs at a time when we are attempting to revive the U.S. economy.

This bill fully complies with PAY-GO.  Because the proposed $8 billion transfer is intergovernmental, the Congressional Budget Office has stated that this fix does not constitute a spending outlay, and thus would not violate PAY-GO.  Likewise, the Joint Committee on Taxation confirms that this transfer will have no revenue effect.

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