Funding Highway Infrastructure: Higher Gas Taxes or New Alternatives?

In a colorful little Mexican restaurant called Casa de Sanchez in North Denver, Fareed Ali ate with some of his coworkers during a break from their job repairing home exteriors. They drive a lot and have been relishing recent low gas prices.

“I would say we cut back a good $600 to $1,000 a week, maybe,” Ali said, adding they are not keen on handing that money back to the government through a higher gas tax.

“I mean, of course not,” he said.

It’s no secret that America’s roads are in trouble. Highways, interstates and bridges are crumbling and there’s an estimated $90 billion annual shortfall to make the fixes.

So, many lawmakers are saying now is the time to raise state and federal gas taxes, which have been the main funding source for road infrastructure for decades.

It may be politically unpopular, but Wyoming and Iowa have raised gas taxes in recent years, and other states are seriously considering it. But, even that may not be the ultimate solution to the widely deteriorating infrastructure.

Replacing this elevated portion of Interstate 70 north of downtown Denver is Colorado's top road infrastructure priority.  The $1.2 billion project will rank as one of the the state's most expensive ever.

Dan Boyce / Rocky Mountain PBS I-News, Inside Energy

Replacing this elevated portion of Interstate 70 north of downtown Denver is Colorado's top road infrastructure priority. The $1.2 billion project will rank as one of the the state's most expensive ever.

“As a form of revenue that goes long-term into the future, the gas tax is a dying tax,” said Amy Ford, communications director for the Colorado Department of Transportation.

Colorado’s state gas tax is a consistent 22 cents per gallon no matter the price of gasoline. It hasn’t been raised since 1993. The federal portion of the gas tax is 18.4 cents per gallon, which hasn’t been raised since the same year, and it monetizes the U.S. Department of Transportation Highway Trust Fund.

Rep. Earl Blumenauer, D-Ore., is pushing legislation to increase the federal gas tax by 15 cents over the next three years, matching a proposal that was included in the 2011 Simpson-Bowles budget reform proposal, according to The Hill, the political website. The report said the Highway Trust Fund will go bankrupt this spring unless Congress acts to replenish it.

According to an Inside Energy analysis, if you account for inflation, CDOT is taking in 30 percent less money from gas taxes now than it did in 2000.

The trend is going ever downward, despite a statewide population increase of a million people since 2000. That’s more cars and trucks pounding out more miles on Colorado roads, shelling out less money in gas taxes.

Increasing the gas tax would help, but the problem is not just inflation – it’s bigger.

“I am the epitome of the challenge we have here in Colorado and really through the country,” CDOT’s Ford said, from behind the wheel of her Toyota Prius, which her husband converted to a fully-electric vehicle.

Amy Ford, Colorado Department of Transportation  communications director, stands with her Toyota Prius which has been converted from a hybrid into a fully electric vehicle. Ford's vehicle illustrates the dilemma of traditional road funding methods like a gas tax.

Dan Boyce / Rocky Mountain PBS I-News, Inside Energy

Amy Ford, Colorado Department of Transportation communications director, stands with her Toyota Prius which has been converted from a hybrid into a fully electric vehicle. Ford's vehicle illustrates the dilemma of traditional road funding methods like a gas tax.

She rarely ever buys gas and thus rarely ever pays gas tax. Fuel efficiency is set to only get better, and younger generation drivers are putting fewer miles on their odometers.

Lone Tree Mayor Jim Gunning is part of MPACT 64, a group of government leaders representing Colorado counties. They have been polling the public to gauge approval of potentially raising the gas tax by 15 cents per gallon, as well as other infrastructure funding options that may be more sustainable.

They range from a slight increase in the state sales tax to an idea being studied by 11 Western states, in which, instead of paying a gas tax, the state would track drivers’ miles and charge a fee based on that mileage. Both Oregon and Colorado are starting pilot projects this year.

The Oregon DOT is looking for volunteers for its pilot, saying that drivers will monitor miles driven using everything from a GPS tracker to an odometer device to a daily diary. “GPS will be the most hassle-free option,” said Michelle Godfrey, a road usage charge program spokeswoman, in a story by the Oregonian newspaper. “But it’s also the option that people tend to dislike the most.”

Lone Tree’s Gunning agreed.

“When we polled that it’s extremely unpopular,” he said, noting a paltry 24-percent approval rating in Colorado for the so-called road usage charge. “People were concerned that we’re going be collecting information that’s too specific to them on a personal level.”

Moving back to Casa de Sanchez, the restaurant is basically in the shadow of Colorado’s top road infrastructure priority, the long, six-lane overpass called the Interstate 70 viaduct. Not only is it a top priority, but at $1.2 billion its demolition and replacement will stand as the most expensive project CDOT has ever undertaken.

The state plans to fund it with some temporary money from the legislature, and another strategy that will likely become a lot more common in the future – entering into a partnership with a private company. The company will get its money back over the long term by opening toll lanes on the new stretch of road.

Still sitting inside the restaurant, Fareed Ali listens to some of the other infrastructure funding models being discussed by government leaders and changes his mind. He definitely doesn’t want the GPS monitored highway usage fee.

“I think that’s horrible. All I can say is government’s going to take over everything,” he said. “Um, I’d probably go for the gas tax, the higher one. I’d rather just pay at the pump.”

Trouble is, that may not be a viable option in the future.

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