US House bill would fund freight projects via cargo fee

Mark Szakonyi, October 3, 2014,

Rep. Alan Lowenthal, D-Ca., thinks shippers are so frustrated with freight bottlenecks on the U.S. highway network that they’re willing to fork over more money for national infrastructure.


A bill he introduced last week would fund two freight grant programs via a national 1 percent waybill fee on the transportation cost of goods. This isn’t the first time a national freight tax or fee has been proposed, but Lowenthal said “infrastructure is falling so far behind and our inefficiencies are growing to great” that there is more traction for such an effort.


Lowenthal likened the proposed fee to the national fuels tax that helps pay for highway, transit and pedestrian projects. But this fee would give the freight industry its own dedicated funding source, which many freight proponents have lobbied for. He told that he hopes the bill will be incorporated into the next federal highway bill.


The bill would fund roughly $8 billion annually for a formula grant system — in which each state would receive dollars depending on their existing infrastructure — and a competitive grant program. States could only receive money through the first program if they created a freight plan.


When asked about potential pushback from shippers, Lowenthal said the “minimal” fee would allow them to move goods more efficiently. Some shippers would be be involved in deciding which freight projects would get funded, ensuring that the market guides the government in using the trust fund dollars most effectively. Importantly, the legislation would create grant programs that fund themselves, and aren’t dependent on federal appropriations or other funding means, said Lowenthal, who represents Long Beach, the home of second-busiest container port in the country.


“We have to have a real proposal that ties down the money and is beholden to the people who will be paying for it,” he said.


Congress in July punted on finding a long-term solution to fund highway, bridges and roads by replenishing the Highway Trust Fund, the main engine of funding, so it could continue through May 2015. Before then, Congress has to find a way to bridge the gap between funding received through the fuels tax and spending plans either by raising the taxes paid at the pump or resorting to budgetary gimmicks again.

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