The Highway Trust Fund (HTF) was established in 1956 to support federal investments to improve the nation’s surface transportation network. Its primary source of revenue is the federal motor fuels excise, which was last increased in 1993. As a result, existing HTF revenue levels are now unable to support current levels of highway and public transportation investment. The HTF suffered six separate revenue shortfalls from 2008 to 2015, which created substantial uncertainty about future funds and led multiple states to delay planned transportation improvement.
The enactment of the “Fixing America’s Surface Transportation Act,” or FAST Act, in December 2015 provided a temporary fix for federal highway and public transportation investment. The FAST ACT transferred $70 billion from the General Fund of the U.S. Treasury to supplement an estimated $208 billion in Highway Trust Fund revenue from existing revenue sources of the course of the authorization. Unfortunately, once the FAST Act expires in October 2020, the Highway Trust Fund revenue shortfalls that plagued surface transportation investment and forced multiple short-term program extensions for well over a decade will return.
Due to the inability to provide a permanent revenue stream for the Highway Trust Fund, Congress and the last two presidential administrations have transferred $143 billion from elsewhere in the federal budget to maintain highway and transit funding. Without a real, permanent solution before the FAST Act expires, Congress will once again be forced to choose between devastating investment cuts or additional temporary bailouts.