The nation’s highways are past due for a major upgrade, but raising the gas tax to pay the bill is a political nonstarter. We explore movements to boost tolls and develop other innovative ways to fund highway maintenance–like charging drivers by the mile.

Guests

  • Emil Frankel Director of Transportation Policy, Bipartisan Policy Center

Transcript

  • 12:06:43

    MR. KOJO NNAMDIFrom WAMU 88.5, at American University in Washington, welcome to "The Kojo Nnamdi Show," connecting your neighborhood with the world. Later in the broadcast, Saudi women will be getting the right to vote, but will they be able to drive to the polls? But first, we all know the price of gasoline fluctuates, $3.89 last week, $3.45 this week.

  • 12:07:16

    MR. KOJO NNAMDIBut one element of that total cost hasn't changed in 18 years, the federal tax that's automatically added at the pump. Since 1993, Americans have been paying 18 cents per gallon in federal gas tax, along with an average of 25 cents a gallon in state tax every time we squeeze the nozzle to fill up the tank. The tax revenue pays for repairs and improvements to the nation's highways.

  • 12:07:43

    MR. KOJO NNAMDIBut a combination of worsening roadways, more fuel-efficient cars and congressional gridlock are forcing policymakers to explore new ways to pay for highway upkeep. While some people argue we're long overdue for a gas tax increase, others say it's time for a greater reliance on tolls and other financing strategies to foot the bill for a growing backlog of highway maintenance and improvements.

  • 12:08:10

    MR. KOJO NNAMDIJoining us now in studio is Emil Frankel, director of transportation policy with the Bipartisan Policy Center. Emil Frankel, thank you for joining us.

  • 12:08:20

    MR. EMIL FRANKELThank you. Nice to be here.

  • 12:08:21

    NNAMDIThere's a big gap in this country between the highway improvements we need and the money that's available to do the work. How would you describe the current imbalance?

  • 12:08:32

    FRANKELWell, it's not just highway needs, of course. It's, generally, our transportation infrastructure, all elements of it. I've been most involved in the service transportation system, so most familiar with highways and bridges and transit and rail and so forth. And those needs are huge across the board.

  • 12:08:51

    FRANKELThe American Society of Civil Engineers has put a figure of $2.2 trillion gap between what we're spending and what we need to spend in order to bring all of our infrastructure, not just transportation -- it's significantly transportation -- but all the elements in new infrastructure into a state of good repair.

  • 12:09:15

    FRANKELSo the shortfall is very, very substantial, estimated well in excess of $100 billion a year that we're falling short, just to maintain the system in a -- as I said, a state of good repair.

  • 12:09:27

    NNAMDIAnd how this works is that the highway trust fund takes proceeds from the federal gas tax and hands them out to the states to do the work.

  • 12:09:35

    FRANKELThat's essentially the case. Although I think it's important to remember that, particularly when we talk about other forms of revenue, such as tolls or what we'll talk about in a moment, highway user charges, the MT vehicle miles travel charges, that the systems and the facilities are largely owned and operated by states or municipalities or transit districts and so forth. Federal government, the U.S. Department of Transportation, as you point out, makes grants.

  • 12:10:07

    FRANKELIt's not outside of the roads and the national parks. It really does not own or operate any systems or facilities directly. So it does make grants to states and metropolitan regions for transportation facilities. They represent, I think, now probably in the range of 35 to 40 percent of the capital costs. Only capital grants are made from -- generally, from the federal government, not operating grants.

  • 12:10:36

    NNAMDIOur guest is Emil Frankel. He's director of transportation policy with the Bipartisan Policy Center. He joins us to discuss funding our highways. If you'd like to join the conversation, call us at 800-433-8850. Do you think the gas tax should be raised to pay for highway repairs and improvements? What do you think is the best way to raise money to repair roads and build new ones?

  • 12:11:00

    NNAMDI800-433-8850. You can send us a tweet, @kojoshow, email to kojo@wamu.org, or go to our website, kojoshow.org. Ask a question or make a comment there. Emil Frankel, the federal gas tax was established in 1932 at a penny per gallon. Got to pause while I weep.

  • 12:11:20

    NNAMDIIt's gone up several times, including in the 1980s and early '90s. In 1993, it was set at 18 cents a gallon, hasn't budged since then. Who was responsible for the last few increases? And how was that money used?

  • 12:11:34

    FRANKELWell, the -- actually, the gas tax, the federal gasoline tax is 18.4 cents a gallon. It was increased, as you pointed out, the last time in 1993, and it had been increased for -- between four and five cents a gallon in 1993 and actually was done for the purposes of reducing the budget deficit. Only later was that money transferred to the highway trust fund. What happened in the mid-1950s, there had been, as you point out, a federal gasoline tax.

  • 12:12:05

    FRANKELIn the 1950s and 1956 when we went forward with the interstate highway system, the gas tax, the federal gasoline tax was dedicated to a new institution that is the highway trust fund. And the money flows to the trust fund and then flows out of the trust fund to states. And, actually, in the 1970s -- I guess it was the early to mid-1970s -- they established within the highway trust fund something called the mass transit accounts.

  • 12:12:32

    FRANKELSo gasoline tax actually pays a portion of transit capital costs as well. There was an increase last time, actually. The gasoline tax was increased for transportation purposes, was actually the mid-1980s, and in 1990 and '93, it was increased for budget purposes, fiscal -- general fiscal purposes, later transferred to the federal -- to the highway trust fund.

  • 12:12:57

    NNAMDIIf you add in state gas taxes, how much do consumers pay at the pump in gas tax overall?

  • 12:13:04

    FRANKELWell, you were quite right in your introduction to the show in talking by an average of about 25 cents a gallon, quite lower in some states, higher in other states. But, generally, I think you can think about the average consumer paying, you know, 40 to 50 cents a gallon in taxes. That's directly at the pump. There are some other taxes. Some states, on top of that, assesses sales tax.

  • 12:13:27

    FRANKELMy state of Connecticut assesses a tax on the wholesale sale price of oil, so that's buried in the base price of gasoline. But what you pay at the pump generally is in the range of 40 to 50 cents a gallon in state and federal taxes.

  • 12:13:41

    NNAMDIAnd Michael in Alexandria, Va., has a question. Michael, you're on the air. Go ahead, please.

  • 12:13:47

    MICHAELYeah. Hi. Good morning. Thanks. I'm just trying to understand how much -- if we've been paying for road repairs and infrastructure out of the gas tax, how is increasing any, as a percentage of the tax, how is that going to actually help? In other words, what percentage is already being used to that? Inflation doesn't seem to be an argument since it's still a percentage, correct?

  • 12:14:12

    FRANKELThat's right. It's not an ad valorem tax. And the gas tax -- and it's lost, as your question points out or your comment points out. It's really lost value because of inflation. The 18-plus cents a gallon is paying, you know, what a third -- it's worth a third less, if you will, than it was at the time it was enacted, maybe more than that. So beyond that, I'm not quite entirely sure I understand your question.

  • 12:14:38

    FRANKELI mean, the money goes out. It's applied by states for major maintenance. Generally speaking, the federal -- both for highway, particularly for highway and some degree in transit. But in highways, the federal money pays 80 percent. It's on a project-by-project basis, and it pays 80 percent of the costs of the project.

  • 12:14:58

    FRANKELSo if you have a major -- let's say you're replacing a bridge on I-95 in Virginia or Maryland that the federal government would pay from the highway trust fund 80 percent of the capital costs of that project.

  • 12:15:14

    MICHAELI guess, my question is -- I mean, tax deducting to be the fix. If the money is already being generated, it seems like the governments are devoting the resources in addition to that to actually to maintain the infrastructure.

  • 12:15:26

    FRANKELWell, the gas tax -- although there have been transfers for the general fund in the last two or three years, but the fact of the matter is the gas tax -- the federal gasoline tax raises about $35-, $36-, $38 billion a year roughly, and that's -- so that's the limit, if you will, outside of general fund transfers.

  • 12:15:48

    FRANKELThat's the limit of federal assistance to states in order to replace, restore substantial rehabilitations or new construction on the highway system and similar situation, obviously, not the same amounts with regard to transit, so that if the need is there -- again, I can talk most specifically about the state I know best. I was commissioner of transportation of Connecticut in the early 1990s.

  • 12:16:13

    FRANKELAnd there are huge projects -- you know, you must remember the interstate system was constructed, planned, you know, 50 or 60 years ago. Much of it was constructed -- let's say in the 1970s, just to take an arbitrary date or the 1960s. And bridges -- major bridges have a lifetime of 40 to 50 years. So what you have is bridges that are beginning to fail.

  • 12:16:39

    FRANKELOn the interstate system, they have to be restored, substantially rehabilitated, replaced. I mean, you saw the situation here in the Washington, D.C. area a few years ago, the Woodrow Wilson Bridge...

  • 12:16:48

    NNAMDICorrect.

  • 12:16:48

    FRANKEL...and the federal money is critical. You can't undertake those replacements, restorations, major rehabilitations without funds, and there are not -- frankly, there are not adequate funds. So the situation is that state highway departments or transportation departments are doing the best they can, kind of Band-Aids, and making sure the bridges are safe and won't fall down. But they're nowhere near in the condition that they need to be.

  • 12:17:12

    FRANKELAnd the situation is going to get worse and worse unless we increase the amount of resources available for that purpose.

  • 12:17:19

    NNAMDIMichael, thank you very much for your call. And resources may be declining as cars have become more fuel-efficient and the economy has slowed. Gas tax revenues have gone down in recent years. What does this mean for the future of the gas tax?

  • 12:17:34

    FRANKELWell, more -- I think, more accurately, Kojo, they have stagnated, I think. There have been ups and downs. I think some of that is replaced by -- and continued growth in vehicle miles traveled, if you will. But the fact of the matter is the gas tax has stagnated. And, of course, if you have an electric car or a hybrid that's getting, you know, 30 or 40 miles to a gallon, it pays less, if you will, in terms of gasoline tax.

  • 12:17:58

    FRANKELSo I think there is a recognition that we have got to -- over the long haul, over the long term, that the gasoline tax will not -- either at the federal or the state level, that the gasoline tax is really not a good substitute or proxy, as we say, for a user charge. Its revenues will stagnate or decline as the needs for investment grow, so that we need to look for new sources.

  • 12:18:22

    FRANKELAnd there's been a lot of discussion about, in some cases, facility-by-facility of tolls. We've just seen that, the construction of the intercounty connector in Maryland with...

  • 12:18:31

    NNAMDICorrect.

  • 12:18:31

    FRANKEL...tolls, not totally, I must say, paid for by the tolls, but a substantial portion of it. And I think what most people think we need -- and this has been talked about for 40 years -- is using the technologies that are available today to charge on the number of miles that you travel.

  • 12:18:48

    NNAMDIYep. I want to get into that also, but I'm glad you brought up tolls and the intercounty connector. Is this a wave of the future? Will all new construction be paid for with tolls?

  • 12:18:57

    FRANKELI think it's fair to say any large new projects, new capacity projects, like the intercounty connector, a new road, a new right-of-way, will require tolls. I mean, we're seeing that in states like Florida and Texas. Almost all the new construction for major new projects or facilities are having to be paid for, in whole or in part, with tolls.

  • 12:19:20

    NNAMDI800-433-8850. Would you like to see lower gas taxes and more toll roads? 800-433-8850. Send us a tweet, @kojoshow, or email to kojo@wamu.org. We're talking with Emil Frankel. He is director of transportation policy with the Bipartisan Policy Center. You can also send email to kojo@wamu.org. Another funding mechanism that's had some successes asking voters to approve local or state taxes or bond measures for specific highway projects, how is that working, for example, in California?

  • 12:19:57

    FRANKELWell, California has something that they call self-help, county self-help. And what they've done, in many cases -- Los Angeles, three different times -- is adopt of half-cent increases in the sales tax, a general sales tax -- it's under user fee -- which they apply to pay off bonds. They then float bonds based on this revenue.

  • 12:20:18

    FRANKELYou have to remember, as I know you do, that you float a bond. You borrow the money. You have to pay it back, and you, therefore, have to create a revenue stream in order to service that debt or bond or -- and to pay it back, which could come from tolls. Most -- that's a way many toll projects going back, really, to the 1930s and longer were constructed. The Pennsylvania Turnpike was done that way.

  • 12:20:45

    FRANKELThey sold bonds, and they paid off the bonds with the tolls on the Pennsylvania Turnpike. Or it can happen with a dedication of income stream from a sales tax or a general tax or a property tax. Last election, I think something like 70 percent, give or take, of bond issues at the state and local level were approved, usually tied to a specific project or a list of projects.

  • 12:21:12

    FRANKELVoters seem -- where there's a specific project or they know what they're getting for their increased tax generally seem, more likely than not, even in tough economic times, to approve the bonds in a related dedication of sales tax or other tax revenues or tolls for that purpose.

  • 12:21:29

    NNAMDIGot to take a short break. When we come back, we'll continue this conversation on funding for our highways. Taking your calls at 800-433-8850 or you can send us a tweet, @kojoshow. I'm Kojo Nnamdi.

  • 12:23:32

    NNAMDIWe're talking funding our highways. Our guest is Emil Frankel, director of transportation policy with the Bipartisan Policy Center. And, taking your calls at 800-433-8850, how would you feel about a system in which you paid a highway improvement fee based on the number of miles you drive? One of the things we'll be talking about today.

  • 12:23:53

    NNAMDIBut before we go there, Emil Frankel, some new highway projects are paid for through a public-private partnership. We're about to experience that ourselves here in Washington when the new High Occupancy Toll lanes, often referred to as H-O-T lanes or HOT lanes, open up on the Capital Beltway.

  • 12:24:09

    NNAMDIHow do these public-private partnerships work? And how likely are we to see more of them?

  • 12:24:14

    FRANKELWell, I think we are going to see more of them. There is private capital that would like to invest in infrastructure, including transportation infrastructure, throughout the world. In Europe, for example, many of the new highways -- virtually all the major new national highways have been constructed by the private sector. I think we do have to understand this is not free money, and revenue streams have got to be established.

  • 12:24:39

    FRANKELEssentially, what is done -- pardon me. Essentially what is done is that a concession is granted to a private company or private venture. They undertake the construction. They arrange the financing, and some -- many cases, they'll maintain and operate the facility once it's constructed. And the tolls belong to the private concessionaire, and they establish the tolls.

  • 12:25:03

    FRANKELAnd the tolls are used to pay off the debt that they've incurred to construct the facility and to bring the returns because they're private entity and looking for profits. This is a good way to do it. It allows projects to go forward where there may not be adequate public resources available. Oftentimes, the private sector can do it more quickly, more efficiently.

  • 12:25:23

    FRANKELThey have certain skills that sometimes may not exist in the public sector. But there are all kinds of varieties of this...

  • 12:25:30

    NNAMDIBut the highways still exist under the jurisdiction of the state or local authority?

  • 12:25:34

    FRANKELIn most cases, yes. I mean, I don't want to speak...

  • 12:25:36

    NNAMDIThe private company does not own the highway, therefore?

  • 12:25:38

    FRANKELRight. It's usually -- when I talk about a concession, it's usually a long-term lease so that -- for example, let's take the so-called HOT lanes, high- occupancy toll lanes on the Beltway in Virginia. The state -- Commonwealth of Virginia entered into a lease with the private venture so that -- and it is a lease, so the underlying ownership remains with the Commonwealth of Virginia. At some point it would revert to it.

  • 12:26:04

    FRANKELAnd for some period of time -- I don't know the exact length of the lease or concession in Virginia -- the private entity will operate it, say, under a lease hold and own the receipts. Now, there are different ways of doing it. In some cases, there'll be -- the public sector may collect the tolls and then make a payment to the private venture. That's done in many cases. These are so-called availability charges or shadow tolls.

  • 12:26:33

    FRANKELSo there are all kinds of ways of doing -- the main thing is to turn over the responsibility to construct and maintain and to collect the money for the -- to the private sector, but there have to -- there has to be an income stream, a revenue stream established to pay back the private sector. So this is not free money for users.

  • 12:26:50

    NNAMDIHere's Mike in Silver Spring, Md. Mike, you're on the air. Go ahead, please.

  • 12:26:55

    MIKEYes. I'm familiar with tolls, and I'm familiar with what the reasoning for putting them in. But I don't like these ideas. I go out of my way to avoid tolls. I think it is just ridiculous to have them. I would be supportive of having a short-term toll to pay for the project. But then it is a lucrative money-maker for whoever gets the contract and has the affordability to go ahead and put in the infrastructure.

  • 12:27:25

    MIKEAnd then they get quite a bit of money over a period of time, and the people who are using these roads are not the wealthiest in the -- at all. In my own opinion...

  • 12:27:38

    NNAMDISo, Mike, you would advocate a system of short-tem tolling, so to speak, until the person, whoever it was who either repaired the highway or established the HOT lane, is, in your view, appropriately compensated for it?

  • 12:27:53

    MIKEYou would have to look at all the rationale. I -- first off, I disagree that the people who are working in our Department of Transportation, state and federal, do not have the expertise to do this. I flatly disagree that the funding streams cannot be mandated and actually gotten so that they can put into the infrastructure.

  • 12:28:16

    MIKEI would agree that the government always pays more than what the private sector pays. How about fixing that instead of saying, well, we're just going to (unintelligible)...

  • 12:28:24

    NNAMDIHere then is Emil Frankel because we're getting into politics here.

  • 12:28:27

    FRANKELYes. You -- I'm not sure whether you're most objecting to private ventures undertaking the construction and operation of these or you just don't like tolls. I mean, most tolls are established by public entities, by toll authorities. That's the way it's been done for decades, obviously. And I think it does -- you know, it becomes a way to construct these projects where tax streams, tax revenues are not sufficient to undertake the project.

  • 12:29:00

    FRANKELIt's another way of financing. You know, ultimately, I do want to emphasize there's a difference between funding and financing. And all these things, whether we're talking about bonds or we're supported by toll revenues or sales taxes or public private ventures, these are all financing tools, techniques to carry out the project.

  • 12:29:20

    FRANKELThe key is where the money is going to come from, whether it comes from taxes or from user charges or some mix of the two. We have to create adequate revenue streams so that we have the investment capital to carry out these programs and to maintain our systems. It's the way we do it with all other network services. I mean, I'm sure you're not advocating that the roads or transportation systems be free.

  • 12:29:45

    FRANKELElectricity isn't free. Telecommunications isn't free. And we have to pay for transportation, or we can't maintain the systems.

  • 12:29:51

    NNAMDIWell, here are sources of skepticism about both the federal government and state governments. On the federal government, from Tony in Aldie, Va., Tony wants to address the issue that the general operating budget of the federal government has repeatedly dipped into the Highway Trust Fund without replacing that money.

  • 12:30:10

    NNAMDIAnd Don in Washington, D.C. says by email, "What is to prevent state governments from using gas tax funds intended for infrastructure for other fiscal shortfalls?"

  • 12:30:20

    FRANKELWell, as to the second matter first, I mean, that has happened in some states. Gas tax revenues, again, you know, taking my own state of Connecticut up until the early 1980s when we had a bridge a collapsed. Some of you may remember on I-95 in Connecticut in 1983. Up until that point, the tolls and gas taxes just went into the general funds.

  • 12:30:44

    FRANKELAnd Department of Transportation had a battle with other departments to get adequate funds for the system. Then Connecticut established its own version of a trust fund. So it does vary and, frankly, it's voter's vigilance, you know, more than anything else and through their legislature and so -- to make sure that user charges, whether gasoline taxes or otherwise, are applied to the transportation systems.

  • 12:31:10

    FRANKELIn terms of money that typically the federal government -- certainly since the Interstate System was established in 1956, money that is flowed into the Highway Trust Fund has remained in the trust fund, if you will, and has been used for transportation purposes. There were some issues about, well, was interest, you know, properly credited? I think all that's been taken care of over the last few years.

  • 12:31:33

    FRANKELAnd, essentially, federal gasoline taxes have been used for transportation purposes for the last 50 some-odd years, 50 or 60 years. What's happening is that that gasoline tax...

  • 12:31:45

    NNAMDIIt's just not enough.

  • 12:31:46

    FRANKEL...is not enough, and they've -- actually, the money has now -- in the last two or three years, $35 billion has gone from the general fund to the Highway Trust Fund to keep it viable in the last three years, adding to the national deficit, to the general deficit.

  • 12:32:01

    NNAMDIIn 2009, a congressional commission recommended that the country move away from reliance on a gas tax and instead begin to generate revenue based on miles driven. How would a system like that work?

  • 12:32:13

    FRANKELWell, that -- we have the technology. I mean, it's -- it could be done from odometer readings. There are some experiments, some pilot programs going on now. There's one in Oregon. When you go to the pump, it kind of reads your odometer and charges you in lieu of a gasoline tax for the miles that you have traveled since the last time you filled up. It could be done that way.

  • 12:32:32

    FRANKELIt could be done in a much more sophisticated way with transponders or GPS technology so that, arguably, wherever your cars goes, if you will, it would know whether you're using a state facility, a local facility, a metropolitan facility, and you get a bill. I mean, many -- I'm sure many people listening to your show now have E-Z passes.

  • 12:32:55

    FRANKELIt's really the E-Z pass technology, but there's -- there are further sophistications of that technology that could be applied. But think about E-Z pass is the one that's most used. That's -- it tends to be facility by facility, but it's that technology.

  • 12:33:07

    NNAMDIWell, how long would it take to transition to such a system if we were to start right now?

  • 12:33:13

    FRANKELYeah, it would -- the estimate of that -- the commission to which you referred was the National Commission on Transportation Infrastructure Financing. Estimates, it would take about 15 years or 10 to 15 years to do that transition, but we haven't started. So it's -- we have to make the beginning because the technology has to be put in place in the back offices and so forth.

  • 12:33:37

    FRANKELSo we have some distance to go. We need to get started on this if we're going to meet that.

  • 12:33:40

    NNAMDIWe're waiting for when it takes two years to make the transition.

  • 12:33:43

    FRANKELRight.

  • 12:33:44

    NNAMDIWe have such sophisticated technology.

  • 12:33:46

    FRANKELRight.

  • 12:33:46

    NNAMDIHere's Kyle in Manassas, Va. Kyle, you're on the air. Go ahead, please.

  • 12:33:50

    KYLEYes. I wanted to say that the idea of moving from a gas tax to a per-mile-driven tax makes absolutely no sense whatsoever. I mean, what you would want to do if you have a per-mile-driven tax, you would then want to charge more if it is a heavier vehicle because heavier vehicles are doing more damage to the road. They are imposing more danger to your fellow driver, et cetera. And you would want to charge more if the vehicle is less fuel-efficient.

  • 12:34:21

    KYLEAnd you get the exact same effect from a gas tax, plus you have much lower administrative cost and lower complexity. I mean, there simply is no gain moving to a per-mile-driven tax.

  • 12:34:37

    NNAMDIWhat do say about that, Emil Frankel?

  • 12:34:38

    FRANKELWell, I think there are two things I would point out. One is that as we transition to more efficient vehicles -- and, arguably, I mean, you might question whether this is going to happen. But if we have all electric vehicles, and that's -- there's major -- which, clearly there are going to be millions of electric vehicles. How are you going to charge them? They obviously would pay no tax at all.

  • 12:34:57

    FRANKELThey'd have totally free use of the highway and transportation facilities without some kind of a user fee. The other thing is the user fee affords you more flexibility. You can deal with exactly the things you've talked about, that heavier vehicles could pay a higher user charge. Vehicles that are dirtier, if you will, more polluting, also could pay a higher charge.

  • 12:35:20

    FRANKELAnd you could do something you can't do today, which is institute something called congestion pricing so that the prices, if you're using a facility, you can do that with tolls as well. In some cases, if you're using a facility at rush hour, arguably, you should pay more. That's the way we do electricity, right? If you use electricity, they try to smooth out the use of electricity.

  • 12:35:41

    FRANKELSo they do that by time-of-day charging. And user fees would allow you to do that, and gasoline tax does not.

  • 12:35:47

    NNAMDIThank you very much for your call, Kyle. We move on to Richard in Hartford, Conn. Richard, you're on the air. Go ahead, please. Richard, you seem to be listening to us...

  • 12:35:57

    RICHARDYes.

  • 12:35:58

    NNAMDIOh, there you go.

  • 12:35:59

    RICHARDA question about the national infrastructure banks. There are bills in the House and the Senate, and the president has put money in his jobs bill. What's the likelihood of passage in the legislature, and also the president's bill being passed, and would it create jobs? And is it a good thing?

  • 12:36:23

    FRANKELWell, I think there are some promising things that Connecticut's own Congresswoman Rosa DeLauro has been pushing. As you know, she's had a bill in for an infrastructure bank for a long time. The bill that the president has adopted, if you will, is sponsored by Senators Kerry and Hutchison. And -- but do remember that it's just a financing tool. It's not a funding tool. It doesn't create new money.

  • 12:36:48

    FRANKELAnd it would make loans for the construction of a major facility, or the reconstruction of a major facility. But you'd have to establish revenue streams, tolls or other things, to pay off the infrastructure bank. It's a bank. It doesn't make grants, or at least that's not -- in the Kerry-Hutchison bill, it would make loans, not grants. So you'd have to establish revenue streams. It's a project-by-project basis. I think it's another financing tool.

  • 12:37:14

    FRANKELIt's interesting. We have some other financing tools in place now, which, I think, could be utilized and expanded. They are programs within the Department of Transportation. And, I think, that's a place to go to bill towards an infrastructure bank. I think it's a long shot that, actually, this Congress will enact, I think, an infrastructure bank.

  • 12:37:34

    FRANKELBut if it allows us to more efficiently utilize resources, provided we create the revenues, then, I think, it offers some promising possibilities.

  • 12:37:44

    NNAMDISome Republicans in Congress would like to see the federal government get out of the business of collecting a gas tax completely and then giving the money to the states. That would mean the states could decide whether and how much to tax gas to pay for road repairs. How would that affect the amount consumers pay at the pump and the amount available to spend on highway upgrades?

  • 12:38:03

    FRANKELWell, obviously, it would vary state by state. And people -- this, again, is a philosophic question, political question. They've been talking -- this is described as devolution, if you will, getting the federal government out of the business and turning it over to the states.

  • 12:38:18

    FRANKELBut I happen to be one who believes, while I think the federal -- the national interest has got to be clearly defined -- it's something we're looking at at our -- at the Bipartisan Policy Center -- perhaps narrowed. It's too expansive now. There are projects and programs that federal money is being used for that are really not in the national interest.

  • 12:38:39

    FRANKELBut on the flip side of that is, I think there are clearly activities like the Interstate System, like major commuter rail systems, for example, that are multi-state regional and impact economic benefits that are national. I think there is a national interest, and I think we should define it more clearly, define national goals and then adequately fund it.

  • 12:39:00

    NNAMDIWhat action, if any, are we likely to see in Congress in the coming months with regard to the gas tax? Two weeks ago, Congress approved a six-month extension of the current 18 cents per gallon tax through March 31 of next year. And tax is such a highly charged word in Washington these days. Are we likely to continue seeing only short-term extensions?

  • 12:39:20

    FRANKELWell, it's both -- it's very unusual. The gas tax has been extended, typically, for long periods of time, six years most recently. This is unusual. It was extended only for six months. Generally, what we pick up is there does seem to be, even in this atmosphere, readiness to continue to extend the federal gas tax at current levels. There is no appetite in either party, Congress, or the administration, to increase the federal gas lien tax right now.

  • 12:39:49

    FRANKELIn terms of the program authority, which is kind of a parallel track, that is all of the authorization for the federal grants, we've been talking about it for a long time. We're two years -- over two years past the expiration of the last bill. We've been -- we're in our eighth extension of those programs, and it's looking uncertain, 50-50 maybe that actually program authority will be extended for a multi-year period. It may again be just a series of short-term extensions.

  • 12:40:22

    NNAMDIEmil Frankel is director of transportation policy with the Bipartisan Policy Center. Thank you so much for joining us.

  • 12:40:28

    FRANKELThank you. Nice to be here.

  • 12:40:30

    NNAMDIWe're going to take a short break. When we come back, Saudi women will be getting the right to vote, but will they be able to drive to the polls? I'm Kojo Nnamdi.

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