As We Grapple With Highway Woes, The Feds Remain Adrift

Original Article

Editor’s note: The Cascadia Center has written a series of articles examining the state’s infrastructure deficit. This is the third article of the series, which is being published exclusively by the Puget Sound Business Journal.

At a recent meeting of West Coast transportation leaders in Portland, Washington’s Department of Transportation Secretary Doug MacDonald noted that America faces three deficits: the federal budget, international trade and transportation infrastructure. He pointed out that since 1965, federal spending on infrastructure as a portion of the gross national product has declined from 3 percent to 2 percent — a relative-share drop of one-third.

Meanwhile, 42,000 people died on our highways last year, in some cases because of congested and unsafe roads. According to a 2005 report by the American Public Transportation Association (APTA), all levels of government fall short of the funding needed just to maintain current highway and transit infrastructure through 2015 — by an astounding $500 billion.

Why? Well, for starters, Congress hasn’t successfully increased the federal fuel tax since 1993. Not only does the tax revenue fail to keep up with inflation, but improved gas mileage eats away at its purchasing power. Emerging hybrid technologies will further erode that power by shifting vehicle dependency from oil to the power grid.

Some have tried to remedy this problem. In 2003, a bipartisan group of congressional members criss-crossed the country pushing a 5-cent gas tax increase to fund a new, six-year, $375 billion transportation proposal (up from the previous six-year plan of $218 billion). And that $375 billion was just to maintain the status quo. A report by the U.S. Department of Transportation showed an additional $150 billion is needed if we want to keep up with future congestion, population growth and the explosion of international trade.

In the end, however, that 5-cent tax hike was deemed too expensive. Faced with a veto threat from President Bush, Congress this year passed a scaled-back, $286 billion plan, sans a tax increase.

If our overall investment in transportation continues to lag behind rising population and increased freight movement, our economy will stagnate and trade-based jobs will be lost. Ironically, solving one deficit may diminish the other two. Prioritizing our nation’s infrastructure strengthens the economy — which reduces the budget deficit. It makes us more globally competitive — which reduces the trade deficit.

On average, one quarter of public investment in transportation infrastructure comes from the federal government, with another quarter from local governments and the remaining half from the states. Washington enjoys a higher proportion of state funding, having raised gas taxes and fees twice in the last two years to catch up with a backlog of projects.

And because federal law now mandates that states receive back over 90 percent of the federal tax they send to Washington, our state has benefited from the federal slice of the pie, as well. Thanks to Sen. Patty Murray, who helped lead the 2005 negotiations, Washington gained $228 million for the Alaskan Way Viaduct.

But the legislation also included 6,500 other earmarked projects — up from fewer than 100 in the 1982 bill. Some would say that without a clear national purpose — like the construction of a major highway system — the federal transportation bill has become little more than a giant local public works project. As former Federal Highway Administration Executive Tom Downs put it, our current national program is “adrift and sinking under the weight of parochialism.”

This trend may seem astonishing to those of us old enough to remember the 1950s and 1960s — a golden age for American transportation. When Congress enacted Dwight D. Eisenhower’s proposal for the Interstate Highway System in 1956, it launched the largest public works program our nation has ever seen. That network of roadways — all 46,677 miles of it — unified our nation’s economy and provided countless jobs for decades to come.

The massive undertaking was not without cost. When Interstate 5 — the “Central Freeway”– first cut through 16.5 miles of the Seattle area in the 1960s, it displaced 5,000 households and permanently transformed the urban landscape. Looking back now, however, the mobility benefits of the highway system outweighed the costs, and — perhaps just as importantly — a unifying national purpose was born.

Now, almost 50 years later, the freeways are built and the Highway Trust Fund (the 18.4 cent federal gas tax and related fees) is in the midst of a major identity crisis. Its grand purpose has dwindled down to mere upkeep, its primary responsibility to fund the maintenance of the federal and state highways it once helped build.

And even this has proved too much to handle.

So what is the proper role of the federal government on transportation? In the next part of this two-part series on transportation infrastructure, Cascadia Center will address this question and explore the concept of regional empowerment. With 50 percent of the trade passing through West Coast ports, whose home states get only 20 percent of federal funding, Washington is joining other states along the West Coast to develop proposals for innovative financing to address crushing infrastructure needs.

BRUCE AGNEW is director and JESSICA CANTELON is a writer for Discovery Institute’s Cascadia Center, a nonprofit public policy center based in Seattle.

Bruce Agnew

Director, Cascadia Center
Since 2017, Bruce has served as Director of the ACES NW Network based in Seattle and Bellevue, Washington. The Network is dedicated to the acceleration of ACES (Autonomous-Connected-Electric-Shared) technology in Northwest transportation for the movement of people and goods. ACES is co-chaired by Tom Alberg, Co-Founder and managing partner of Madrona Venture Group in Seattle and Bryan Mistele, CEO/Co-Founder of INRIX global technology in Kirkland. In 2022, Bruce became the director of the newly created Pacific Northwest Economic Region (PNWER) Regional Infrastructure Accelerator. Initial funding for the Accelerator has come from the Build America Bureau of the USDOT. PNWER is a statutory public/private nonprofit created in 1991 by the U.S. states of Alaska, Idaho, Oregon, Montana, and Washington and the Canadian provinces of Alberta, British Columbia, and Saskatchewan and the territories of the Northwest Territories and the Yukon. PNWER has 16 cross-border working groups for common economic and environmental initiatives.