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FAST Act and Transportation Policies

Posted by Infra on Friday, January 8th, 2016

AMERICAN ACTION FORUM

Written by Emil H. Frankel

In December 2015, the “Fixing America’s Surface Transportation Act” or FAST Act became law.  The FAST Act:

  • Reaffirmed a continuing federal role in surface transportation, but continued a growing dependence on general funds and generally flat funding through the life of the law;
  • As the first multi-year surface transportation authorization bill enacted in many years, FAST Act provided greater certainty and predictability of federal funding for state and local agencies, but Congress failed, again, to develop sustainable revenue streams to support federal surface transportation programs over the long-term.
  • Did not advance the challenge of accountable and performance-based federal transportation programs that invest scarce federal resources in the most beneficial projects;
  • Advanced multi-modalism in surface transportation by including for the first time a title on intercity passenger rail; and
  • Improved national policy on freight and goods movement.

While the passage of FAST Act is to be applauded for many reasons, major challenges to the nation’s transportation infrastructure remain unaddressed.

Introduction

In early December 2015 Congress passed, and the President signed, a five-year surface transportation reauthorization bill, “Fixing America’s Surface Transportation Act” or FAST Act.  This was the first time in ten years that Congress had been able to enact such a multi-year bill.  Although the enactment of multi-year surface transportation bills by large bipartisan majorities had been almost automatic for a half-century, this achievement, in an otherwise deeply divided and partisan Congress and political environment, was notable.

In passing a five-year bill, Congress provided some greater degree of certainty to the state transportation departments, transit agencies, and other state and local grantees, which still receive significant assistance from the federal government for their transportation capital programs.  The over $60 billion a year from both the Highway Trust Fund (HTF) and general funds insures that the surface transportation program remains one of the largest in the federal domestic budget, and for many states and transit agencies these grants still represent very significant portions of their own capital programs.  So, the continuity and certainty of federal funding, established by FAST Act, will be important to these grantees and will allow them to continue with their own investment programs.

Finally, and perhaps most important, leading members of both Houses were determined to stop the pattern of repeated, short-term extensions of surface transportation programs and continual transfers of general funds to HTF (or “patches”) that had occurred over the last seven or eight years.  While a caucus of members in the House of Representatives generally prefer devolution of the federal transportation programs to the States and the elimination of the federal gasoline tax, FAST Act still passed in the House by 359 to 65.  In the Senate objections were raised about the “pay-fors,” on which the transfer of about $70 billion of general funds to HTF was based.  Without those pay-fors, program levels for the highway and transit programs could not have been maintained.

Conclusion

In its re-affirmation of a continuing federal role in surface transportation, FAST Act is an important statute.  However, this legislation continues a trend toward a growing dependence on general funds for these programs and stagnation in the general level of federal funding for surface transportation.  The inevitable result is a growing burden on states and localities to address the needs of an aging, deteriorating, and often-congested national surface transportation network.

FAST Act also fails, as did its most recent predecessors, to address the issue of establishing sustainable revenue streams to support the federal role in transportation.  Moreover, the challenge remains to assure accountable and performance-based federal transportation programs, in order to increase the probability that scarce federal resources will be invested in the most beneficial projects.

While the passage of FAST Act is to be applauded for many reasons, major challenges to the nation’s transportation infrastructure remain unaddressed.

View full version (americanactionforum.org): FAST Act and Transportation Policies

Emil H. Frankel is a Visiting Scholar at the Bipartisan Policy Center (BPC) in Washington, DC, and an independent consultant on transportation policy and public management issues. Previously, he served as BPC’s director of transportation policy.  In June 2009, BPC’s transportation project, under Frankel’s leadership, issued its report and recommendations, Performance Driven: A New Vision for U.S. Transportation Policy.  He is a Senior Fellow at the Eno Center for Transportation and a Senior Advisor of Crosswater Realty Advisors.

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One Response to “FAST Act and Transportation Policies”

  1. jerry schneider says:

    I have read elsewhere that the pay-fors don’t actually happen during the 5 years covered by this bill – is uses money from the next five years should it actually be available. This is a highly unsatisfactory solution and should not be allowed.

    And, the focus is almost totally on conventional solutions instead of finding ways to bring innovative solutions to a market-ready level – just more of the same without trying to move toward more cost-effective solutions. Support for passenger rail is an example of the huge deficiency in the content of this bill.

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