WASHINGTON (Reuters) - The fund that supports U.S. highway repairs and construction is set to run out of money before August, the highest ranking Republican on the Senate Environment & Public Works committee said on Tuesday.
“We recently learned that the Highway Trust Fund will run out of money some time before August of this year, and will require an infusion of $5 to $7 billion to get through the rest of fiscal year 2009,” said Oklahoma’s James Inhofe at a confirmation hearing for the next federal highway administrator.
Even though the fund has a constant revenue source from the gas tax, it is in constant danger of depletion. Last summer, the U.S. government had to pump in emergency cash to prevent the fund from being emptied. Not only will the government have to do that again this summer, but it may have to pour in an additional $8 billion to $10 billion in 2010, Inhofe said.
In March, Transportation Secretary Ray LaHood pledged that President Barack Obama would not raise the 18.4 cents tax on each gallon of gasoline sold. The tax has not been raised since the early 1990s and some say that has created the fund’s current shaky state.
Others said that rising gasoline prices, along with more Americans driving fuel-efficient cars, have pushed down gas purchases, and with them, gas tax collections.
Many have looked to the economic stimulus plan enacted in February for funds for highway repairs. But Inhofe said that threats of a trust fund shortfall are forcing some states to suspend highway work.
“This will be done by canceling new projects and existing contracts that have already been signed, in addition to slowing down projects that have already broken ground,” he said. “Clearly this would have a detrimental effect on the economy and will negate any gains made by the stimulus.”
Reporting by Lisa Lambert and John Crawley; editing by Jeffrey Benkoe