Highway-Oriented House Transportation Bill: Why It's Hated by Everyone

The bill, which cleared the House Transportation and Infrastructure Committee earlier this week on party lines, would channel domestic oil and natural gas drilling revenues to the Highway Trust Fund and eliminate the 20 percent dedicated funding for mass transit, forcing it to compete with road projects for a share of the nation's gas tax revenues.

Transit activists and environmentalists were perhaps most angry about the bill, organizing a national call-in day yesterday against the bill. Transportation Secretary Ray LaHood, one of Obama's Republican cabinet nominees, told Politico that the bill was the most partisan transportation bill that I have ever seen, and Rep. Blumenauer (D-Ore.) called the bill dead on arrival. In an editorial published Wednesday, the New York Times called it uniquely terrible.

In addition to removing the 20 percent dedicated transit funding, which began during Ronald Reagan's administration, the bill would deny California money for its high-speed rail project, which has been criticized by conservatives for its skyrocketing costs and ambitions to remake California's transportation landscape.

Transit blogger Alon Levy, who is normally critical of many of the federal government's transit initiatives, said that the bill makes no attempt to let go of [transit] projects that cost too much while maintaining those whose cost is adequate, instead cancelling funds for even relatively cost-effective projects like New York City's Second Avenue Subway. The Tea Party-infused mood has soured many conservatives on public transportation, whose perception in Middle America is perhaps best exemplified by Newt Gingrich's much-publicized comments about subway-riding elites.

Budget hawks were also skeptical of the bill, which was partially funded through speculative drilling revenues. The small-government Club for Growth called the bill a remarkably bloated and inefficient piece of legislation, and Rep. Jeff Flake (R-Ariz.) said that the bill was too big and not a good direction.

The house bill also sought to break from the decades-old principle of user pays, funding highway improvements from user fees rather than general revenue. Marc Scribner of the libertarian Competitive Enterprise Institute wrote in a National Review op-ed that the Republican-backed bill was misguided piece of highway robbery that breaches their own longstanding principles.

One thing that the bill would not do is raise the federal gas tax, which is currently at 18.4 cents per gallon--the lowest it's been in over two decades when measured in inflation-adjusted dollars. Despite calls from infrastructure groups, fiscal conservatives, and environmentalists to raise the tax to plug the gap in the federal Highway Trust Fund, this is a political non-starter in an election year. During the 2008 presidential campaign, Hillary Clinton and John McCain even proposed a gas tax holiday for the summer of 2008, although the proposal was never turned into law.

One group that was happy about the bill was the American Trucking Associations, whose president released a press release calling the bill a major step forward. By maintaining road spending while leaving the federal fuel tax at its current nominal level, the trucking industry would be effectively subsidized by the domestic energy exploitation portions of the bill.

The Senate version of the bill, meanwhile, is moving toward a vote on the floor after passing the Democrat-controlled finance committee, but without the gas tax inflation indexing that was supported by Republican Sens. Mike Enzi of Wyoming and Tom Coburn of Oklahoma. The Obama administration still says it supports raising the gas tax, but such a move looks unlikely, as both chambers' bills leave the federal excise level unchanged.