Dead End, No Turn Around, Danger Ahead: Challenges to the Future of Highway Funding Hearing Committee on Finance United States S
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S. HRG. 114–276 DEAD END, NO TURN AROUND, DANGER AHEAD: CHALLENGES TO THE FUTURE OF HIGHWAY FUNDING HEARING BEFORE THE COMMITTEE ON FINANCE UNITED STATES SENATE ONE HUNDRED FOURTEENTH CONGRESS FIRST SESSION JUNE 18, 2015 ( Printed for the use of the Committee on Finance U.S. GOVERNMENT PUBLISHING OFFICE 20–336—PDF WASHINGTON : 2016 For sale by the Superintendent of Documents, U.S. Government Publishing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 VerDate Mar 15 2010 16:31 Jun 07, 2016 Jkt 000000 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 R:\DOCS\20336.000 TIMD COMMITTEE ON FINANCE ORRIN G. HATCH, Utah, Chairman CHUCK GRASSLEY, Iowa RON WYDEN, Oregon MIKE CRAPO, Idaho CHARLES E. SCHUMER, New York PAT ROBERTS, Kansas DEBBIE STABENOW, Michigan MICHAEL B. ENZI, Wyoming MARIA CANTWELL, Washington JOHN CORNYN, Texas BILL NELSON, Florida JOHN THUNE, South Dakota ROBERT MENENDEZ, New Jersey RICHARD BURR, North Carolina THOMAS R. CARPER, Delaware JOHNNY ISAKSON, Georgia BENJAMIN L. CARDIN, Maryland ROB PORTMAN, Ohio SHERROD BROWN, Ohio PATRICK J. TOOMEY, Pennsylvania MICHAEL F. BENNET, Colorado DANIEL COATS, Indiana ROBERT P. CASEY, Jr., Pennsylvania DEAN HELLER, Nevada MARK R. WARNER, Virginia TIM SCOTT, South Carolina CHRIS CAMPBELL, Staff Director JOSHUA SHEINKMAN, Democratic Staff Director (II) VerDate Mar 15 2010 16:31 Jun 07, 2016 Jkt 000000 PO 00000 Frm 00002 Fmt 0486 Sfmt 0486 R:\DOCS\20336.000 TIMD C O N T E N T S OPENING STATEMENTS Page Hatch, Hon. Orrin G., a U.S. Senator from Utah, chairman, Committee on Finance .................................................................................................................. 1 Wyden, Hon. Ron, a U.S. Senator from Oregon .................................................... 4 WITNESSES Kile, Joseph, Ph.D., Assistant Director for Microeconomic Studies, Congres- sional Budget Office, Washington, DC ............................................................... 6 LaHood, Hon. Ray, senior policy adviser, DLA Piper, Washington, DC ............. 7 Moore, Stephen, visiting fellow in economics, The Heritage Foundation, Wash- ington, DC ............................................................................................................. 9 ALPHABETICAL LISTING AND APPENDIX MATERIAL Hatch, Hon. Orrin G.: Opening statement ........................................................................................... 1 Prepared statement .......................................................................................... 39 Letter to Hon. Max Baucus from Senator Hatch et al., December 2, 2011 ................................................................................................................ 41 ‘‘Democrats Steer Towards Highway Funding Cliff,’’ by Burgess Everett and Heather Caygle, Politico, June 3, 2015 ................................................ 43 ‘‘The Road to Sustainable Highway Spending,’’ Committee for a Respon- sible Federal Budget, May 13, 2015 ............................................................ 45 Kile, Joseph, Ph.D.: Testimony .......................................................................................................... 6 Prepared statement .......................................................................................... 53 Response to a question from Senator Hatch .................................................. 73 LaHood, Hon. Ray: Testimony .......................................................................................................... 7 Prepared statement .......................................................................................... 74 Responses to questions from committee members ......................................... 78 Moore, Stephen: Testimony .......................................................................................................... 9 Prepared statement .......................................................................................... 79 Wyden, Hon. Ron: Opening statement ........................................................................................... 4 Prepared statement .......................................................................................... 82 COMMUNICATIONS American Association of Port Authorities (AAPA) ................................................ 85 American Association of State Highway and Transportation Officials ............... 94 American Council of Engineering Companies (ACEC) ......................................... 102 Associated General Contractors of America .......................................................... 103 American Highway Users Alliance ......................................................................... 109 American Public Transportation Association (APTA) ........................................... 110 American Society of Civil Engineers (ASCE) ........................................................ 114 California Transportation Commission .................................................................. 118 Concrete Reinforcing Steel Institute (CRSI) ......................................................... 120 Fry, Dean .................................................................................................................. 121 Great Lakes Metro Chambers Coalition ................................................................ 124 Highway Materials Group ....................................................................................... 126 Institute on Taxation and Economic Policy (ITEP) .............................................. 128 (III) VerDate Mar 15 2010 16:31 Jun 07, 2016 Jkt 000000 PO 00000 Frm 00003 Fmt 5904 Sfmt 5904 R:\DOCS\20336.000 TIMD IV Page Mileage-Based User Fee Alliance (MBUFA) ......................................................... 131 National Association of Manufacturers .................................................................. 132 National Automobile Dealers Association .............................................................. 133 National Conference of State Legislatures ............................................................ 135 Orski, Kenneth ......................................................................................................... 137 PeopleForBikes Business Network ......................................................................... 141 The Real Estate Roundtable ................................................................................... 142 Tire Industry Association ........................................................................................ 145 Transportation Equity Caucus ............................................................................... 147 VerDate Mar 15 2010 16:31 Jun 07, 2016 Jkt 000000 PO 00000 Frm 00004 Fmt 5904 Sfmt 5904 R:\DOCS\20336.000 TIMD DEAD END, NO TURN AROUND, DANGER AHEAD: CHALLENGES TO THE FUTURE OF HIGHWAY FUNDING THURSDAY, JUNE 18, 2015 U.S. SENATE, COMMITTEE ON FINANCE, Washington, DC. The hearing was convened, pursuant to notice, at 10:03 a.m., in room SD–215, Dirksen Senate Office Building, Hon. Orrin G. Hatch (chairman of the committee) presiding. Present: Senators Grassley, Crapo, Enzi, Thune, Isakson, Toomey, Coats, Heller, Wyden, Schumer, Stabenow, Cantwell, Nel- son, Menendez, Carper, Cardin, Brown, Bennet, Casey, and War- ner. Also present: Republican Staff: Chris Campbell, Staff Director; Mark Prater, Deputy Staff Director and Chief Tax Counsel; and Nicholas Wyatt, Tax and Nominations Professional Staff Member. Democratic Staff: Ryan Abraham, Senior Tax Counsel; Robert An- dres, Research Assistant; and Jocelyn Moore, Deputy Staff Direc- tor. OPENING STATEMENT OF HON. ORRIN G. HATCH, A U.S. SENATOR FROM UTAH, CHAIRMAN, COMMITTEE ON FINANCE The CHAIRMAN. The committee will come to order. Before we begin the hearing, I just want to take a moment to express my sor- row for the horrific events that took place last night in Charleston, SC. I am sure that those sentiments are shared by everyone on the committee and everyone here. I have no words to express that would adequately address the senseless violence and loss of life. I simply ask that everyone join me in a moment of silence so that we can offer our thoughts and prayers to the victims and their loved ones. [Moment of silence.] The CHAIRMAN. Thank you. Well, good morning, everyone. Today we will be discussing the challenges Congress faces as we work to provide funding for the Federal Highway Trust Fund. Right now, when it comes to high- ways, we find ourselves caught in a familiar dilemma between rais- ing taxes or cutting back on the highway program. As always, a long-term, bipartisan solution to this dilemma will be difficult to achieve, and, some days, it almost seems out of reach. However, in the past, this committee has consistently stepped up to the plate (1) VerDate Mar 15 2010 16:31 Jun 07, 2016 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 R:\DOCS\20336.000 TIMD 2 to find ways to keep the Highway Trust Fund solvent. I am con- fident that we can do so again. I want to make it clear at the outset that my goal as chairman of this committee is to find a way to fund a long-term infrastruc- ture bill. Chairman Ryan over in the House said much the same thing in yesterday’s Ways and Means Committee hearing. And, while some friends on the other side of the aisle have suggested that it would be politically advantageous to force votes on a series of very short-term extensions,