Feds looking to fix broke highway fund
State officials are differing on the trickledown effect the U.S. Department of Transportation's financial nose dive will have on Illinois.
Transportation Secretary Mary Peters announced Friday that the highway trust fund is essentially broke and urged Congress to pass an $8 billion temporary bailout.
"We can't write checks if we don't have a balance in the account," Peters said at a news conference. "There always was a balance in the trust fund. Now we're living from treasury payment to payment."
Illinois relies on the federal funding, which comes from gas taxes, to pay for engineering and construction of road and highway projects. With the fiscal crisis, payments to states will be made weekly instead of twice daily and revenues will be given on a pro-rated basis.
"We will pay the reimbursement fully if there's enough money. If we only receive 80 percent, we will pay 80 percent," Peters said.
The Illinois Department of Transportation is reviewing the impact on its projects. Spokesman Mike Claffey said the agency didn't anticipate an immediate problem and was hopeful the federal government would act to resolve the shortfall.
U.S. Rep. Dan Lipinski, the region's sole representative on the House Transportation Committee, forecast serious repercussions if the $8 billion doesn't materialize.
"If we do not act, Illinois stands to lose $366 million next year. The Senate needs to pass it as soon as possible and it needs to be done now," said Lipinski, a 3rd District Democrat from Western Springs.
The primary cause of the red ink is that Americans are driving less because of high fuel costs and subsequently paying less in gas taxes, now set at 18.4 cents a gallon. In August, U.S. DOT reported Americans drove 53 billion miles less than they did a year ago.
Peters faulted Congress for failing to pass a new surface transportation bill and come up with a plan to address the fact that the gas tax is an unreliable way of funding highways.
"The current approach made sense 50 years ago," Peters said. "We need to find a funding structure that is sustainable."
Although she previously has advocated increasing tollways as a means of paying for roads, Peters didn't give specifics on new ways to boost revenues but added, "I would not recommend increasing the motor fuel tax."
In calling for the Senate to approve a plan that already passed in the House transferring $8 billion from the general fund to the highway trust fund, Peters and the Bush administration reversed previous positions. In July, the White House threatened to veto the measure, calling it a gimmick.
The change was necessary to protect states from losing revenues, Peters said.
Illinois Sen. Dick Durbin said funding reductions would hurt Illinois highway programs. He was cautiously optimistic that the Bush administration's change in tone would change the minds of Senate GOP members who have blocked the plan.
"I hope this reversal will have the Republicans lifting their filibuster," the downstate Democrat said.
IDOT officials said the crisis underscored the need for the state to pass a capital construction bill. State lawmakers are headed back to Springfield next week and are expected to talk about a capital proposal.
Benedictine University political science professor Roger Rose recently returned to Lisle from a sabbatical in Washington, D.C., focusing on transportation issues.
"Given the jobs report today, the last thing our economy needs is a reduction in funding transportation projects," Rose said. "And the longer these projects are stretched out, the more expensive they become due to inflation and the extra expense of working longer on projects."