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Transportation Funding

American Government Special Collections Reference Desk

American Government

Transportation Funding

Senator Tom Carper (D-DE)
Congressional Record: 114th Congress
September 24, 2015

Mr. CARPER. Madam President, I don't know that I will say anything profound, but I appreciate the chairman of our committee saying that.

Madam President, and fellow native West Virginian, I will show a map of the United States in just a minute, and there are some States that are delaying and some States that are cutting back on transportation projects. One of them is West Virginia. One of them is Delaware. I want to talk a little bit about that.

Before I do, I would like to go back in time 10 months to the election of last year. I am reminded of the message I heard from the electorate that came out of that election. To simplify it, there were three things they were trying to tell us. No. 1, they want us to work together; No. 2, they want us to get things done; and, No. 3, they want us to get things done that will actually strengthen our economic recovery.

If you go back in time to the January--the week Barack Obama and Joe Biden were inaugurated as President and Vice President, 628,000 people filed for unemployment insurance in that 1 week in January of 2009. Any time that weekly number of people filing for unemployment insurance is over 400,000, we are losing jobs in this country and in the economy.

Last Thursday we got a number from the Department of Labor. Last week's number was about 265,000 who filed for unemployment. That was last week. There is a new number today--I am not sure what it was, but for the last 28 weeks that number of people filing for unemployment insurance has been under 300,000. I think that is the longest that we have been keeping track, where we had 28 consecutive weeks where fewer than 300,000 people in this country were applying for unemployment insurance. That number is way under 400,000, so we are adding jobs, and we are expecting to continue to add jobs in this country.

There are still people looking for jobs in my State, there are in West Virginia, and other States as well, but when you consider the unemployment rate was about 10 percent in the early part of 2009 and today it is a little over 5 percent, we are making progress, but we can make a lot more progress.

One of the ways we can make progress is by dealing with our fiscal plan and not hold the Nation's economy hostage with our inability to pass a spending plan. And God help us if we drop the ball on this again and have another shutdown. I sure hope we come to our senses and avoid doing that. My hope is that we will.

One of the other ways we can strengthen our economic recovery--and it is right out there for us to seize and do--is to make sure that in a nation where roads, highways, bridges, and transit systems are deteriorating, where we need to make improvements and we need to build, frankly, new projects--new highways, bridges, roads and transit systems--at the very least we need to maintain the quality of what we have or improve the quality of road safety, surfaces, potholes, you name it. There is a lot of work to be done, and there are a lot of people who would like to do the work.

The McKinsey Global Institute, an arm of the national consulting firm McKinsey, looked at what we could do for our growing GDP in this country if we fully funded a 6-year transportation plan, what we could do for an employment opportunity if we funded a 6-year transportation plan, and the numbers are remarkable--I think amazing.

We were told that fully funding a 6-year transportation plan would grow our GDP by approximately 1.5 percent per year--not for 1 year but for the life of the transportation plan that we funded--probably 6 years at 1.5 percent a year. When you consider the GDP growth over the last couple years, even though it is better than it was, adding 1.5 percent of the GDP growth would help our economy grow in a robust way. We are told by McKinsey & Company's study that a 6-year transportation plan robustly funded would put about 1.8 million people to work. A lot of folks would like to be building roads, highways, and transportation systems, and they don't have employment opportunities because we are not funding them. We are not funding them.

Let's take a quick look at this map if we could. The States that are gray are States, as far as we know, that are not planning to delay or cancel projects. They are not even considering delaying projects, but the States that are in red, including Delaware over here, are States that have delayed or cancelled projects. The States that are in yellow, including West Virginia, are States that are considering project delays.

That is not good. I have not counted the number of States--it looks like seven--that are in red. Those are the States that have delayed projects. More than that, probably 10, are considering doing that. Why is it important for us to fully fund at the Federal level--do our share for roads, highways, bridges, transit funding? It is because about half of the money that our States spend through their departments of transportation, half their money comes from Federal user fees--largely Federal user fees--primarily, not entirely, but primarily user fees on the sale of gasoline. It has been unchanged in 23 years--not since 1993--22 years. The user fee on diesel has been unchanged for some 22 years, right where we were. The price of everything else goes up. Concrete goes up, asphalt goes up, steel goes up, and labor goes up.

We have more energy-efficient vehicles. They are not using as much gas or diesel. That is a good thing, but it is also a bad thing for having funding for transportation projects. So I want to look at a map and would invite all of us to consider it. I don't anybody who says--any economist worth their salt--who does not say: Fully funding a multi-year transportation plan, not for 6 months or 3 months, something like that, but fully funding it--robustly funding it for 6 years--will do great things for our economy.

The reason we end up with job growth of something like 1.8 million people, according to McKinsey and Company, is because the economy works far more efficiently if roads, highways, bridges are operating and working well. So I just want to share that and start off my remarks today.

I have some numbers here that I would like to share. So far in 2015, this year, four States--Arkansas, Georgia, Tennessee, and Wyoming--have shelved some $805 million in projects due to the uncertainty over Federal funds. Again, the uncertainty is over roughly half the money that they are going to spend on roads, highways, and bridges. It comes from Federal user fees, Federal taxes.

Our transportation system--at least the way we fund it--has been broken since 2008. Since that time, in the last 5 or 6 years, we have passed I think 12 short-term patches to the tune of nearly $74 billion. How do we pay for them? We pay for them with budget gimmicks. That is how we do it. And we pay for them with debt. When we issue debt, we borrow money. We sell Treasury securities, and we sell them around the world. Among the countries that buy them are China and the Chinese people. We are then beholden to them as our creditors. It puts us in a situation that I do not find too comfortable. My guess is some of you don't either.

There are better alternatives to fund our Nation's transportation system. I only mentioned a couple of them. I feel as if I have not a magic wand but the ability to see into the future. Twenty years from now, I think there is a pretty good chance that we will have figured out how to pay for roads, highways, bridges, and transit systems by figuring out how to make sure those folks who use transportation pay for it. One of the ways we are trying to do that--they have been trying to do that in Oregon for almost 10 years. They have something called road user charge. Some people have heard of that term. More people have heard of something called vehicle miles traveled, and the ability to say your vehicle--I don't care what kind of vehicle it is, but we know how many miles that vehicle travels on a road, highway or bridge in the course of a year. There is fee that is attached to that. Some people are uncomfortable with that because it has implications on privacy. I can understand that.

In Oregon they are trying to figure it out. They have got about 5,000 vehicles--at least--in their system. They are sort of--I like to say States are laboratories of democracy. In this case, Oregon is trying to be the laboratory. I believe California is looking at being another laboratory to figure out we make something like vehicle miles traveled work in a State. Oregon is good-sized state, and California is a very big State. If they can do that, then we will learn from them, not just at the State level but perhaps at the Federal level as well.

I think we will be funding projects--not just now but in the future, 20 years from now--through tooling. When I travel back to my native State of West Virginia, I go through West Virginia and I pay tolls. When I was a little kid and they first built the turnpike, we would have to stop and find change--whatever--stop every 5 or 10 miles. You don't do that anymore. We don't do that anymore in Delaware either, because we have--in Delaware and I think in West Virginia--highway-speed E-ZPass. It is an express E-ZPass. You go through, and it is charged to your credit card that you have already established when you establish your E-ZPass plan.

Also, we now have the technology that even if folks don't have an E-ZPass--in some tolling operations around the country, a person drives through in their vehicle, car, truck, van, whatever the system--when you go through the toll plaza, they don't collect a toll. They have a highly accurate camera with the ability to take pictures of the vehicle and great pictures of your license plates, and then they send a bill to the owner of that vehicle. So you don't even have to have high-speed E-ZPass. But a combination of those two, systems like E-ZPass and systems like the one I just described where people drive through with no E-ZPass or a similar system, but they actually get billed for it later on. They do not get billed and fined; they just get billed for it. If you don't pay it, then I am sure something will happen.

But I think 20 years from now we will have something that looks a lot like that. My guess is we will also have user fees, but not everybody likes tolling. As it turns out, Oregon has been working on road user charge, also known as vehicle miles traveled. They have been working on it for 10 years, and they have got 5,000 people in the plan. So this is not going to happen in 5 years or 10 years, but maybe 20 years for both a combination of tolling and vehicle miles traveled.

There is another idea out there that is used in some places around the country. It is called 3P or P3. When I first heard that, I thought they were talking about P-3 airplanes. I spent a lot of years of my life as a naval flight officer in P-3 aircraft. I used to command them, but they were not talking about airplanes when they were talking about P3. They were talking about public-private partnerships. We have some pretty good examples of where that is working. We can learn from those in different States. I think that can be part of the future. It ought to be.

Put the three of them together, is that a comprehensive plan? Not entirely, but it is pretty good approach. It is a heck of a lot better than what we have been doing: pension smoothing, increasing fees for TSA. Instead of improving aviation safety, we put the money in the transportation trust fund. Raising Customs fees--instead of putting the money in ways to make our borders most robust and so forth, we put some of that money in the transportation trust fund.

We sell oil out of the Strategic Petroleum Reserve--I think probably at a bad time to sell it, when the price is really low. They say: Buy low, sell high. Well, if we are going to sell petroleum out of the petroleum reserve--the price of oil is about as low right now as it has been in a long, long time.

I am told that--I don't know if it was last week or the week before--there are 10,000 gasoline stations across the country where they are selling gasoline for less than $2 a gallon. I don't know what they are charging in West Virginia, but I filled up my Chrysler Town and Country minivan, which has 403,000 miles on it, and I paid $2.15 a gallon. There are some places in Delaware where people are paying less and in neighboring New Jersey where they are paying less. But right now, it does not make much sense to sell oil out of our Strategic Petroleum Reserve. There are some people who want to and who want to use that money to go into the transportation trust fund. I think that is foolish. We have to be smarter than that.

I have another chart I want us to take a look at. I want to thank ``Vanna White'' here for putting up these charts. I will pay for that later. This chart talks about legislation--it is kind of ironic. That is S. 1994. I mentioned earlier how the last time we raised the Federal gasoline and diesel tax or fee was in 1993 when we raised it to 18 cents for gas and about 23, 24 cents for diesel. They have been there for 22 years.

One of the things I have done is introduce legislation, and I have done so with Dick Durbin, who used to serve on the Bowles-Simpson Commission--remember the Bowles-Simpson Commission. I thought it was a great approach to figure out how to seriously address our Nation's deficit in a variety of ways. One of the ways that Bowles-Simpson said we should address our deficit situation--I will say our budget deficits are down--topped out, I think, in 2009 at $1.4 trillion. This year we are down about $400 billion. Is that an improvement? Yes, it is. Do we have some ways to go? We sure do.

What Bowles-Simpson suggested is that we raise the gas or diesel tax at the Federal level by a penny each quarter, a penny every 3 months for 15 quarters. So effectively you would be raising the gas or diesel tax by 3 or 4 cents a year for 4 years and index it going forward.

What Senator Durbin and I have introduced is actually something quite similar to that, which a majority of the Bowles-Simpson Commission voted for. It is called the Traffic Relief Act. What it calls for is an annual 4 cent gas increase in gas and diesel. That would be for a total of about 4 years--4 cents a year for 4 years. After that, we would index those user fees, those taxes, to the rate of inflation. The rate of inflation is pretty low lately, so they would not go up very much if the rate of inflation stays where it is. If the rate of inflation rears its head again, then that would be different.

A fellow who was a member of my staff back in Wilmington, DE--when we introduced this bill, the price for gas at a station in the neighborhood where his family buys gas--in the space of 2 days, the price of gas either went up or went down by 13 cents. It went up in 2 days, 13 cents. As we know, the price of oil moves up and down all of the time.

My own belief is--and I have heard this from a lot of people--there are a lot of days or a lot of weeks where the price of gas or diesel goes up a lot more than 4 cents. Right now our world is not literally awash in oil but certainly figuratively awash in oil. One of the reasons the price at the pump for gas and diesel is so low--as I said earlier, a couple of weeks ago there were 10,000 gas stations across the country selling gas for less than two bucks a gallon. One of the reasons it is so low is because the United States is producing a lot more than we have for some time, and so are a bunch of other countries, including the OPEC nations.

With the approval of the Iran agreement, as the Iranians comply with the agreement--my hope is that they will comply in spirit and in letter, and then as a result of that, they will be in a position to begin selling. They have only been selling some of their oil products to customers, including I think India, maybe Japan, China, but they will be able to sell more products.

A world that is already awash in oil is going to find that Iran, which I think has the fourth greatest oil reserves in the world, is going to be back in the market and selling their own products. I believe that will keep the prices from rising anytime soon. And I think there is reason to believe that the price at the pump, which is already quite low, might even go down further. Time will tell.

I have one last poster board here I wish to look at for just a moment.

Our legislation--this is a typo here. It says that it restores $240 billion for the highway trust fund. It is not $240 billion, it is $220 billion. Still, compared to what? Compared to nothing. Compared to doing nothing, it is a whole lot. If we had a status quo, any kind of a status quo increase--a highway bill or a transportation bill--we would use maybe half of that. So what we are talking about is double, just getting by, And we have such a backlog of work to do, that it doesn't make sense just to push enough money to these projects to get by.

This would provide roughly twice that amount of money and would maybe not raise our GDP by 1.5 percent, but it would sure raise it. It may not put 1.8 million people to work over the next year, but it would put a lot of people to work and people who like to do these jobs.

The money would fully fund the Federal highway and transit programs in our country. It would increase investments in upgrades and in repairs as well. It would do it in a way that doesn't drop a huge burden on users of these products--gasoline and diesel--all in one fell swoop. It is like 4 cents a year over 4 years. After 4 years, there will be a 16-cent increase.

People say: Well, what is that in terms of practical impact? What does that actually mean for somebody?

I am told that it is actually--I don't drink a lot of coffee, but my friends who do get a small coffee over in the Dirksen Building across the street. They pay $1.70, and if they get a medium-sized coffee, it is like $2.50, and a really big one is maybe a little bit over $3. This is not really fancy coffee but just a regular cup of coffee with cream and sugar, and the price is maybe $2 or $3. Literally for the price of a cup of coffee a week, for those of us who use roads, highways, bridges, who buy gas, who buy diesel, we could have a much better transportation system. This isn't $10 a week or $20 a week or $30 a week. That increase over 4 years--4 cents a year for 4 years--without the data for the average driver, that is about a cup of coffee a week. Is that too much to pay for roads, highways, bridges, and a good transit system? I don't think so.

There is an interest in offsetting some of these increases with a regressive tax, but there is an interest in offsetting some of that by making some tweaks like Michigan is going to do with their State earned-income tax credit with a Republican Governor and Republican legislature. I think there is maybe a lesson or something we can do there to help address the regressive nature of this tax.

I close by saying I come to this floor from time to time and I mention one of the things I love to do. I don't know if you ever do this, Madam President, but I love to ask people who have been married a long time ``What is the secret for being married for a long time?'' I have done it for years. I have asked this question of hundreds of people who are older folks who have been married 30 years, 40 years, 50 years, 60 years, 70 years. I ask them ``What is the secret?'' I get hilarious answers. I get some that are very poignant and others are just plain memorable for a lot of reasons. But the best answer I have ever gotten is there are two C's. What are the two C's? Communicate and compromise.

That is not only the secret for a vibrant marriage between two people, it is also the secret for a vibrant democracy, to communicate and compromise. I would add a third C, and that is to collaborate. What the American people said to us last November--whether they are Republicans, Democrats, or Independents--is that they want us to communicate, they want us to compromise, and they want us to collaborate, and we need to do that.

One idea I have not mentioned here bears mentioning. It was an idea that was endorsed last year by the administration and was endorsed last year by the immediate past chairman of the Ways and Means Committee, with whom our President served, Dave Camp. He retired earlier this year as a Congressman from Michigan, a very good person. What they proposed is international tax reform. What both Chairman Camp at the time and the administration said is that there are about $2 trillion in overseas profits of American companies. They are just keeping it over there and they are not that anxious to bring it back because they don't want to have to pay--I don't know--35 percent, 33 percent, 32 percent, 29 percent. They are looking for a lower tax break and then to bring it back when it makes sense.

The administration and Dave Camp said: Let's deem it repatriated.

The Treasury said: All right. You have money over there, American companies. Bring it back. It is going to be taxed at about 10 percent.

That was the proposal.

The administration said: American companies that have money over there, we want you to bring it back. You won't be taxed at 35 percent or 25 percent, but you will be taxed at about 14 percent.

That is an idea, and it is an interesting idea. It doesn't solve the problem forever. It provides one-time money--quite a bit of it--for roads, bridges, rail, and for airports as well. It doesn't solve the problem permanently, but it surely gives us a lot of money. Not every company likes that idea, and not everybody who serves here likes that idea, but it is a serious idea, and it is one

that deserves a lot of consideration, and I hope we will do that.

Let me just say this. At the end of the day, if we come to the end of this calendar year--when we run out of money yet again for roads, highways, and bridges and we say ``Well, what are we going to do now?''--we will have not just the States I pointed out here in yellow and red that are bailing on projects, delaying and stopping them in some cases, we will have a lot more yellow and a whole lot more red on the map I had up earlier. What do we do about it? Do we just do what we have done for 5 years and kick the can down the road yet again and look for cats and dogs and wherever we can find a few bucks and sort of throw them at the problem for a while, not make a real committed effort? Frankly, we are not giving the voters in this country any reason to feel encouraged about our courage. I hope we don't do that.

If at the end of the day we don't do some kind of international tax reform, good ideas such as expanding tolling, vehicle miles traveled, and public-private partnerships--those are all good ideas, and I hope we grow them all. We are not going to have them all in place in the kind of scope we need by the end of this year.

If we find ourselves at a time and place where we run out of money, where the States are looking to us and we are running out of money at the Federal level--and the price of gas is two bucks a gallon at gas stations across America--my hope is people will say: You know, for the price of a cup of coffee, I could have good roads, highways, bridges, and transit systems again. For the price of a cup of coffee a week, I could have that. Forty cents a week, maybe.

Maybe that is not a bad deal for their family or for our country. I want people to think about that.

In the weeks to come, I am going to be talking a lot about this proposal. My hope is that as time goes buy, people will say--like my dad used to say in West Virginia when my sister and I were little kids growing up and they were in West Virginia--my dad used to say to my sister and me after we had done yet another boneheaded stunt: Just use some common sense. He said that a lot. He did not say it that nicely. But I think this may be an opportunity for us to use some of that common sense here, and I know he would approve, and at the end of the day, so would the voters of America.

There are a number of States that have actually done what I am talking about. They have raised their user fees, and in some cases they have phased them in over a couple of years. It is interesting what happened in the elections last year where the State legislators had voted to do that, where they raised the user fees in order to would pay for roads, highways, and bridges. Interestingly enough, the legislators who voted for that--Republicans--didn't get thrown out of office. Ninety-five percent of them were reelected. They won their primaries, they won their general elections, and they were reelected. The Democrats who voted for those modest user fees increases didn't get thrown out of office either. In the States that raised the money locally to make the improvements that were needed in transportation, 90 percent of the Democrats won their primaries and they won their general elections. They were reelected.

People want us to make hard choices here. They don't want us to continue to kid them or fool them; they want us to do the real thing. They want us to work together. They want us to get things done. They want us to strengthen our economic recovery, and this is not a bad way to do that.

With that, I see a great American from New Mexico has joined us. He is somebody who has worked with the Senator from Louisiana and the Senator who was just here before, Mr. Inhofe, the chairman of the EPW Committee, to try to find a good way for us to strengthen the economic recovery and at the same time to further clean our air, promote public health, and do good things for our public environment. I wish to say to Tom Udall how proud I am to be his colleague and how much I appreciate his leadership position on a very important issue, an environmental law that hasn't been updated in almost 40 years and, frankly, doesn't work. It has never worked, and we need to do something about it. Under his leadership, along with our other two colleagues, my hope is that we will. I look forward to what he has to say.

I yield the floor.

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