Chris Spear, president and CEO of American Trucking Associations, told a Senate panel that the federal government needs to invest more into highway infrastructure to keep up with rising freight demand as transportation trade organizations commended Congress on approving tax reform.
“The Highway Trust Fund is projected to run short of the revenue necessary to maintain current spending levels by 2021, creating a huge funding gap that could force states to cancel or delay critical projects,” Spear said.
On Wednesday (Dec. 20), Spear spoke to the U.S. Senate Committee on Environment and Public Works’ Subcommittee on Transportation and Infrastructure.
“It should be noted that a $60 billion annual average federal investment still falls well short of the resources necessary to provide the federal share of the investment needed to address the nation’s surface transportation safety, maintenance and capacity needs.”
The United States spends less than half of what it needs to address these needs, according to the American Society of Civil Engineers.
“As the investment gap continues to grow, so too will the number of deficient bridges, roads, bottlenecks, and most critically, fatalities attributable to inadequate roadways,” Spear said.
American Trucking Associations supports increasing the fuel tax by 20 cents per gallon, phased in over four years, and would generate nearly $340 billion in 10 years, he said.
“This proposal will stabilize the trust fund for many years and provide the resources necessary to reduce the project backlog.”
The average passenger vehicle driver would pay a little more than $100 annually for the tax.
“Over the next decade, freight tonnage is projected to grow by more than 40%,” Spear said. “The trucking industry is expected to carry more than two-thirds of the nation’s freight in 2028. It will be tasked with hauling 3.2 billion more tons of freight in 2028 than it moved this year. Without federal support and cooperation, the industry will find it extremely difficult to meet these demands at the price and service levels that its customers, American businesses, need to complete globally. It is imperative to our nation’s economy and security that Congress, working with the administration, invest in critical highway freight infrastructure and make the reforms necessary to create an improved regulatory environment that fosters greater safety and efficiency in our supply chain.”
Spear also asked the Senate committee to focus on improving infrastructure across other transportation modes “in order to maintain the smooth flow of commerce in the country.”
American Trucking Associations and the Association of American Railroads commended Congress for approving tax code changes.
“Tax reform will make our customers and the freight railroads more globally competitive,” said Edward Hamberger, president and CEO of the Association of American Railroads. Key provisions in the reform, including the corporate tax rate reduction and “full and immediate expensing for five years, will help support private investment across the 140,000-mile rail network and the entire economy. We look forward to moving on to other policy debates next year that affect our industry and our customers, especially in ensuring that NAFTA remains in place, in making the short line tax credit permanent and in comprehensively addressing U.S. infrastructure and transportation systems.”
Dave Manning, chairman for American Trucking Associations, said tax reform is a win for not only the trucking industry but for the “entire economy. The relief this bill provides will enable companies to invest in their growth, by hiring new employees or purchasing new equipment. That creates an economic stimulus with positive ripple effects that reach far and wide.”