The Highway Trust Fund is set to run out of money in September and Congress wants to save it with a one-time repatriation tax. The proposal would allow companies to repatriate off-shore income at a tax rate of 6.5 percent with the revenue directly funding the Highway Trust Fund. The problem with this plan is that it is a short-term, one-time solution. The only way Congress can ensure the long-term sustainability of the Highway Trust Fund is by raising highway user-fees.
For the early part of its existence, the Highway Trust Fund operated solely using revenue from the federal gas tax. However, the gas tax quickly became unpopular with consumers and is now difficult to increase. In 1993, the gas tax was raised to 18.4 cents a gallon and it has not changed since. With dwindling gas tax revenues, the Highway Trust Fund no longer has a stable funding source. Over the next ten years the fund is expected to operate with a $169 billion budget shortfall.
The Highway Trust Fund’s purpose is to pay for the expansion the highway system and regular road maintenance. With the fund now in dire straits, come September states will have no federal money to help pay for highway construction and maintenance.