Motorists’ Federal Gas Taxes Subsidize other Transportation Modes

COST Comments: As verified in this report, diversion of federal highway gas tax funds to non-transportation uses and to subsidize transit and other transportation modes contributes to the shortage of roadway construction and maintenance funds. Texas diverts an even greater percentage (about 50%) of its state highway gas tax funds than the federal government (about 40%). These major federal and state diversions, inflation erosion of gas tax value and vehicles using less gas per mile have all resulted in an increasingly critical shortage of funds for road construction and maintenance. The United States must transition to a new highway funding model to assure adequate highway funding.

Key findings in the report below are:

1. “the federal transportation actually made a profit from motorists because they paid more in user fees and taxes (mostly the 18.3 cent per gallon federal fuel tax/user fee) than they recieved in subsidies for roads.” Transit and other diversions to non higway uses have been about 40% of the federal gas tax in recent years.

2. “the federal costs of supporting rail and transit passengers is excessively high and that investing in roads would be a more cost-effective solution that would accomodate the needs of most commuters and travelers.”

Federal Transportation Programs Shortchange Motorists: Update of a USDOT Study

by Wendell Cox and Ronald D. Utt, Ph.D.

In December 2004, the Bureau of Transportation Statistics at the U.S. Department of Transportation (USDOT) published its first and last report on the cost of the federal subsidies provided to each mode of transportation per passenger per 1,000 miles: cars, buses, airplanes, transit, and passenger railroad. The survey covered the years 1990 to 2002 and demonstrated that motorists received the lowest federal subsidy per 1,000 passenger-miles and that transit and Amtrak received by far the largest federal subsidies

Not surprisingly, the much higher subsidies revealed by the report were an embarrassment to transit and train advocates in Congress, and USDOT was discouraged from further exercises in transparency. Consequently, the 2004 report was the first and last of its kind.

In this paper, The Heritage Foundation has updated and replicated the original 2004 USDOT study by adding new data for 2003 through 2006.

Wendell Cox
Demographia | Wendell Cox Consultancy – St. Louis Missouri-Illinois metropolitan region
Visiting Professor, Conservatoire National des Arts et Metiers, Paris
France..33.6.16.63.58.76
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www.demographia.com | www.publicpurpose.com | www.rentalcartours.net

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