U.S. Plans Shift of Road Costs to States, Cities

A national transportation policy to be released today will call for a fundamental restructuring that will shift to state and local governments a greater share of the burden of building and maintaining the nation’s highways.

According to a draft of the policy, the Administration plans to concentrate the federal share of highway spending on selected roads “of national significance,” leaving the care and maintenance of a great majority of highways to state and local governments.

President Bush and Transportation Secretary Samuel K. Skinner are expected to unveil the long-awaited transportation policy this morning at a White House news conference. Virtually all states can expect less federal aid for highway projects under the plan, which would increase pressure in many states for higher gasoline taxes to make up the shortfall.

To pay for road repairs and construction on roads newly designated “of national significance,” the Administration will aggressively seek tolls and other forms of user fees on roads, bridges and other federally supported structures, and will spend the $10-billion surplus in the federal highway trust fund.

The report did not specify how many of the nation’s approximately 900,000 miles of roads now eligible for federal funding would be among those designated as having special national significance.

To assist the local governments, the policy pledges the federal government’s help in removing restrictions that now inhibit cities and states from imposing tolls and other revenue-generating schemes.

Moreover, the policy calls for the Administration to encourage local governments in their efforts to find “innovative financing” with private businesses as a source of additional funding for transportation projects.

“One of the greatest opportunities for improving transportation efficiency and service in the future lies in allowing market forces to work, minimizing government intervention and increasing flexibility for the private sector,” the transportation policy states.

The plan also called for reducing federal operating assistance for mass transit, while increasing the state and local share of federally financed mass transit projects. It also called for an end to federal funding for Amtrak.

The plan is the Administration’s blueprint for legislative action. The department must go before Congress for funding; highway funding authorizations will be expiring within the next one to two years.

A key feature of the policy is the call for refurbishing of the nation’s overcrowded and decaying highway system. But it offers few specifics, such as projecting construction timetables or specific national highway projects.

Reaction to the proposal was mixed. Although some praised the plan and said it gave states greater flexibility to raise money without federal strings, others denounced the federal government’s move to reduce its role to that of a “junior partner.”

Lisa Covington, public information officer with the California Department of Transportation, welcomed the policy’s main points, noting that they jibe with programs already on the drawing board in the state.

“California is pleased with the flexibility that the policy provides the state to address issues we’ve targeted as important,” she said. “Many of the things in the national policy are things that we are doing or working toward in California.”

She said the Administration’s plan would allow California to raise gasoline taxes and spend the revenues as it sees fit, rather than having to follow Washington’s directives. Moreover, she said, California has already begun projects aimed at developing private toll roads in parts of the state.

Federal highway funds contribute about 45%, or about $2 billion, of California’s annual highway transportation budget. Covington said state officials are not worried about the federal government’s diminished role in spending on highway projects because she believes that the state can make up the shortfall.

She said the state still expects to get a share of the money contained in the highway trust fund.

The fund has a surplus of about $10 billion, and it continues to grow. Federal highway spending is about $14 billion a year--about $2 billion a year less than the annual fuel tax receipts of more than $16 billion.

But the lack of specific federal programs was a sore point with numerous critics of the proposal. Others complained about the policy’s goal of shifting cost burdens to local governments, which already assume the lion’s share of highway improvement costs.

“It’s long on advice but short on help,” said Jack R. Gilstrap, executive vice president of the American Public Transit Assn., a Washington-based lobby for municipal mass transit. “When it gets down to cases as to just what is the federal government’s role, they see themselves as a junior partner.”

Gilstrap, who served for 10 years as general manager of the Southern California Rapid Transit District in Los Angeles, said the Ronald Reagan Administration cut in half national funding of mass transit programs.

“We thought the Bush Administration would recognize a domestic need, but what we’re getting is warmed-over Reagan here,” he said.

Jan Baird, vice president of Commuter Transportation Services in Los Angeles, said the Administration is sending a lot of its problems back to the states. “The federal government is backing out of a lot of things it used to be involved with in the past,” she said.

Meanwhile, entrepreneurs sensing great profits to be earned by exploiting the new transportation policy hailed the Administration’s objectives. Ralph Stanley, president of the Toll Road Corp. of Virginia, which is building a private toll road in suburban Washington, said the plan’s emphasis on private involvement in highway construction and refurbishing is needed.

“I think it’s an absolutely necessary idea,” said Stanley.