Sunday, March 9, 2003

Lawmakers consider raising federal gas tax

Money needed for highways, they say

By Jim Abrams
The Associated Press

WASHINGTON - House Transportation Committee leaders are thinking about increasing the federal gas tax to sustain the nation's deteriorating highways, but others in the House say that's unlikely with gas prices at near-record highs.

Transportation Committee chairman Don Young, R-Alaska, and top Democratic member James Oberstar of Minnesota say they need $375 billion over the next six years just to maintain and make some improvements to the highway system.

They have asked for $50 billion for the 2004 budget year for highway and transit programs, compared with the $36.5 billion President Bush proposed.

"The economy cannot continue to grow without a transportation system that moves people and goods efficiently," Young told the House Budget Committee this week. He added that there is no longer a choice between raising or not raising more revenues. "Rather, our choice is between different methods of adjusting them."

One method being mulled is indexing the gas tax for inflation, retroactive to the last change in 1993. That would boost the federal tax, currently 18.4 cents a gallon, by about 5.4 cents. State gas taxes average an additional 22 cents per gallon.

Other possibilities are raising the tax 2 cents a year through 2009, taxing ethanol at the same rate as gasoline or stopping the practice of transferring interest from the highway trust fund - money from the gas tax dedicated to highway programs - to the general Treasury fund.

The current six-year highway program, which expires this year, was funded at $218 billion, but lawmakers say that spending level falls far short of current needs.

A letter to the Budget Committee signed by 74 of the 75 Transportation Committee members cited a Transportation Department report estimating it would require $53 billion a year just to keep highways and transit systems in their current conditions. About $75 billion a year would be needed to improve highway safety and reduce congestion.

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