May 1, 2008
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The Honorable Harry Reid
Majority Leader
United States Senate
528 Hart Senate Office Building
Washington, DC 20510
Dear Majority Leader Reid:
On behalf of the American Public Transportation Association (APTA) and its more than 1,500 member organizations, I write to urge you to oppose any legislation proposing to suspend the federal motor fuels tax for the summer. Not only is this proposal short-sighted, but it is unlikely to result in any significant financial benefits to consumers and would potentially destabilize the Highway Trust Fund.
The federal motor fuels tax generates revenue for the Highway Trust Fund, affording state and local governments predictable funding with which to plan highway and transit investments. With a three month suspension during the widely-traveled summer months, the balance of the trust fund will be reduced by $9 billion. In fact, during the period when regular gasoline prices increased by 230 percent, the 18.4 cents-per-gallon gas tax has remained the same, resulting in a 32 percent decline in real purchasing power. With the Highway Trust Fund facing insolvency in 2009, further cuts will result in substantial reductions in necessary and beneficial infrastructure investments. While we recognize that certain proposals offer means of replenishing the lost trust fund revenues with general fund transfers or increased taxation on oil companies, this sets a dangerous precedent for “solutions” to future economic challenges.
Further, the proposal to suspend the gas tax would save consumers an average of $28, while resulting in a sizable $23 billion in long-term economic loss. Not only does every $1 invested in public transportation result in $6 in economic returns, but it contributes to the attainment of national goals to reduce congestion and our dependence on foreign oil. Congestion likely will increase without a gas tax, as more people will opt to drive, contributing to more pollution and wasted time and money spent in traffic. In order to reduce our dependence on foreign oil, we must drive less, not more, and public transportation gives Americans that option without compromising their mobility needs.
Reliable and safe transportation infrastructure is essential to our nation’s vitality. By suspending the federal tax on motor fuels, the ability to invest in necessary infrastructure, including quality public transportation, is diminished. Americans are not calling for less federal investment in highways and transit systems, but more. We urge you to oppose any proposals to eliminate the collection of the federal motor fuels tax for any period of time. We thank you for considering APTA's views. If you have questions, please have your staff contact Rob Healy of APTA's Government Affairs Department at (202) 496-4811 or email rhealy@apta.com.
Sincerely,
William W. Millar
President
WWM/tjj
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