The federal gas tax should be increased to help modernize U.S. roads, bridges and other public works, and Congress must expand funding and financing options for projects, U.S. Chamber of Commerce President Tom Donohue said.
The chamber is calling on Congress and the Trump administration to raise federal fuel taxes by 25 cents, pass initiatives including a new federal loan guarantee program, streamline permitting and take action to ensure there are enough trained workers.
“The time is now. Its time to invest in a 21st century infrastructure, a system of infrastructures to support and grow our 21st century economy,” Donohue said at an event at the chamber’s headquarters in Washington, D.C., Thursday.
The U.S. business lobby is hosting a summit with business, policy and labor leaders to discuss infrastructure investment and to “jump-start” action in Washington in 2018 as President Donald Trump prepares to roll out principles for a promised $1 trillion infrastructure initiative this month.
The chamber is calling for increasing the federal gas tax by 25 cents — five cents per year during the next five years, including indexing the rate to inflation — to raise $394 billion over 10 years. That would cost the average American about $9 a month more in gas taxes.
The last time federal fuel levies were raised was 1993. Since then, 39 states have increased their gas taxes, the chamber said.
The business lobby previously has called for increasing the federal gas tax as the simplest, fairest and most straightforward way to raise more money for projects. But this is the first time it has recommended an amount.
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The federal per-gallon taxes of 18.4 cents on gasoline and 24.4 cents on diesel were last raised 25 years ago. Since then, the revenue they generate has declined as inflation has reduced their purchasing power and the average fuel economy of passenger vehicles increased.
While some Republican congressional leaders flatly have rejected an increase, Rep. Bill Shuster, the Republican chairman of the House Transportation and Infrastructure Committee, has said every option should be on the table. The Trump administration hasn’t endorsed an increase but hasn’t ruled it out.
“Our leaders need to stop hiding behind the fallacy that this can’t be done and just go do it,” Donohue said.
The chamber is also pushing for more private and public investment. The recommendations include expanding federal infrastructure loan programs such as the Transportation Infrastructure Finance and Innovation Act and creating a federal new loan guarantee program to be repaid through dedicated public and private funding sources.
Statutory barriers on using public-private partnerships such as limiting the number of airports that could be practically sold or leased to the private sector at 10 should be removed, and private activity bonds should be expanded, the chamber said.
The business lobby is calling for a discretionary grant program to encourage state and local investment, similar to what the Trump administration has been proposing.
Any infrastructure initiative must streamline the permitting process for projects, the business lobby said. Trump issued an executive order in August to establish “one federal decision” for major projects and an average two-year goal for permitting.
That order should be made into law, the chamber said. Permitting at the state and local level, which also can delay projects, also should be addressed, the group added.
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More trained workers are needed, too, the chamber said. Companies including AECOM, Skanska USA and Turner Construction have said the industry is hard-pressed to find enough people for current openings, let alone with the expansion Trump envisions with an additional $1 trillion in spending.
The chamber said it will push policy makers to advance the recommendations of the Labor Department’s task force created last year to expand apprenticeships and reform “ineffective” programs.
Congress and the Trump administration are fighting about how to protect the approximately 800,000 undocumented immigrants brought to the United States as children, known as “dreamers,” and immigration must be fixed to keep and attract skilled workers, the chamber said.