Americans consistently agree that the country needs more infrastructure investment. Just as consistently, however, they agree that they don’t want to pay for it.
To a large extent, this hesitation to pony up is the fundamental cause of the current infrastructure crisis. As Fitch Ratings concluded in a recent report, “the ability to secure a revenue stream from either users or taxpayers is generally the limiting factor” preventing investment. It’s not just the oft-discussed idea of a gas tax hike, unpopular both among the public and on Capitol Hill, either. Issuance of municipal debt for new funding is at a twenty-year low. Even toll roads, which have seen a construction boom over the past decade, are now facing a backlash.
But a new survey from the Mineta Transportation Institute shows that all hope may not be lost when it comes to raising revenue from taxpayers.
On its face, the new poll corroborates much of what we already knew about public opinion on infrastructure.
A majority of respondents said that reducing traffic, maintaining roads, and reducing accidents should all be “high priorities” for the government. When asked if they would support a modest 10-cent gas tax hike to pay for these improvements, however, a resounding 68 percent said no. Even when told that such an increase would only cost them $50 more per year in taxes, most were still against the idea.
But an interesting thing happened when the surveyors explicitly linked the gas tax with the priorities that respondents had mentioned before: they changed their minds. If revenue from the tax hike went only to transportation projects that reduced pollution, 52 percent said they’d support it. Only for technological advancements received support from 59 percent. Only for maintenance, 71 percent.
To cynics, it might seem like a maddening contradiction, but it also speaks to an essential aspect of winning public support for infrastructure investment: linking the process by which money is raised for infrastructure investment to specific projects that get built and, by proxy, specific impacts those projects will have.
Simple enough in theory, but extremely difficult in practice. Many Americans, after all, are aware that the money they pay via the gas tax goes to the Highway Trust Fund, which in turn pays for transportation improvements. But getting more specific than that can be difficult, even for an infrastructure expert. According to the Congressional Budget Office, about 80 cents out of every federal dollar spent on transportation is allocated to state governments based on legally enshrined formulas, rather than to specific projects. Though much of this money is loosely earmarked for safety or maintenance programs, state departments of transportation have broad discretion when it comes to deciding which projects are funded. Sometimes, the federal government itself isn’t always aware of which projects its funding supports—a report last year from the Government Accountability Office found that the Federal Highway Administration does not record aggregate project-level spending data for 88 percent of the projects it funds.
With this low level of transparency, it shouldn’t surprise anyone that the public has little faith that new tax revenue will go to the projects that matter. And while there are thousands of sorely needed public works that Washington helps to fund, skeptics are also right to highlight the persistence of wasteful projects.
Just last month, for instance, Secretary Anthony Foxx announced that the department would award a $209 million low-interest loan to Ohio to help build the Portsmouth Bypass, a 16-mile highway project in the southern part of the state near the Kentucky border. But observers, particularly Angie Schmitt at Streetsblog, have questioned the need for a brand-new four-lane highway around a town of just 20,000 people in an economically depressed part of the state.
The loan money for the Portsmouth Bypass won’t come from the coffers of the Highway Trust Fund, but the project underlines why it is difficult to make the case for greater federal funding without also calling for wiser and more accountable investments.
To its credit, the Department of Transportation has attempted in recent years to combat this problem with a series of new grant programs, the most notable of these being TIGER grants, which award funding to specific projects through a competitive process rather than the old-fashioned formulas.
But these initiatives represent just a fraction of overall infrastructure spending, and in the face of conservative opposition, simply keeping them in existence has needed an intense legislative effort. As part of the “Cromnibus” spending bill that passed Congress last year, for example, Republicans slashed funding by “only” $100 million for this year’s round of TIGER grants.
That’s a shame, because if the Mineta poll makes anything clear, it’s that the public will gladly pay taxes to fund infrastructure if it knows where the money is going. With the Highway Trust Fund set to run out of money once again this summer, it’s a fact that policymakers would do well to remember.
Tags: taxes, infrastructure, transportation, public spending
Public Seeks Transparency in Infrastructure Investment
Americans consistently agree that the country needs more infrastructure investment. Just as consistently, however, they agree that they don’t want to pay for it.
To a large extent, this hesitation to pony up is the fundamental cause of the current infrastructure crisis. As Fitch Ratings concluded in a recent report, “the ability to secure a revenue stream from either users or taxpayers is generally the limiting factor” preventing investment. It’s not just the oft-discussed idea of a gas tax hike, unpopular both among the public and on Capitol Hill, either. Issuance of municipal debt for new funding is at a twenty-year low. Even toll roads, which have seen a construction boom over the past decade, are now facing a backlash.
But a new survey from the Mineta Transportation Institute shows that all hope may not be lost when it comes to raising revenue from taxpayers.
On its face, the new poll corroborates much of what we already knew about public opinion on infrastructure.
A majority of respondents said that reducing traffic, maintaining roads, and reducing accidents should all be “high priorities” for the government. When asked if they would support a modest 10-cent gas tax hike to pay for these improvements, however, a resounding 68 percent said no. Even when told that such an increase would only cost them $50 more per year in taxes, most were still against the idea.
But an interesting thing happened when the surveyors explicitly linked the gas tax with the priorities that respondents had mentioned before: they changed their minds. If revenue from the tax hike went only to transportation projects that reduced pollution, 52 percent said they’d support it. Only for technological advancements received support from 59 percent. Only for maintenance, 71 percent.
To cynics, it might seem like a maddening contradiction, but it also speaks to an essential aspect of winning public support for infrastructure investment: linking the process by which money is raised for infrastructure investment to specific projects that get built and, by proxy, specific impacts those projects will have.
Simple enough in theory, but extremely difficult in practice. Many Americans, after all, are aware that the money they pay via the gas tax goes to the Highway Trust Fund, which in turn pays for transportation improvements. But getting more specific than that can be difficult, even for an infrastructure expert. According to the Congressional Budget Office, about 80 cents out of every federal dollar spent on transportation is allocated to state governments based on legally enshrined formulas, rather than to specific projects. Though much of this money is loosely earmarked for safety or maintenance programs, state departments of transportation have broad discretion when it comes to deciding which projects are funded. Sometimes, the federal government itself isn’t always aware of which projects its funding supports—a report last year from the Government Accountability Office found that the Federal Highway Administration does not record aggregate project-level spending data for 88 percent of the projects it funds.
With this low level of transparency, it shouldn’t surprise anyone that the public has little faith that new tax revenue will go to the projects that matter. And while there are thousands of sorely needed public works that Washington helps to fund, skeptics are also right to highlight the persistence of wasteful projects.
Just last month, for instance, Secretary Anthony Foxx announced that the department would award a $209 million low-interest loan to Ohio to help build the Portsmouth Bypass, a 16-mile highway project in the southern part of the state near the Kentucky border. But observers, particularly Angie Schmitt at Streetsblog, have questioned the need for a brand-new four-lane highway around a town of just 20,000 people in an economically depressed part of the state.
The loan money for the Portsmouth Bypass won’t come from the coffers of the Highway Trust Fund, but the project underlines why it is difficult to make the case for greater federal funding without also calling for wiser and more accountable investments.
To its credit, the Department of Transportation has attempted in recent years to combat this problem with a series of new grant programs, the most notable of these being TIGER grants, which award funding to specific projects through a competitive process rather than the old-fashioned formulas.
But these initiatives represent just a fraction of overall infrastructure spending, and in the face of conservative opposition, simply keeping them in existence has needed an intense legislative effort. As part of the “Cromnibus” spending bill that passed Congress last year, for example, Republicans slashed funding by “only” $100 million for this year’s round of TIGER grants.
That’s a shame, because if the Mineta poll makes anything clear, it’s that the public will gladly pay taxes to fund infrastructure if it knows where the money is going. With the Highway Trust Fund set to run out of money once again this summer, it’s a fact that policymakers would do well to remember.
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Tags: taxes, infrastructure, transportation, public spending