Highway Trust Fund User Fee Proposal

Dear Speaker Johnson, Minority Leader Jeffries, Majority Leader Thune, and Minority Leader Schumer:

The Congressional Budget Office's recent analysis of the Highway Trust Fund's (HTF) financial health underscores the urgent need for meaningful reforms to the "user fee" system as part of the next surface transportation reauthorization. We urge you to restore fairness and fiscal responsibility to federal investments in our nation's roads, bridges, and transit systems.

For over 70 years, motorists have contributed to the building and maintenance of our nation's surface transportation network through federal "user fees" on gasoline, diesel, and other motor vehicle-related excise taxes. This innovative framework made possible a fair and fiscally responsible method to build and maintain this network by having those who use and benefit from it contribute to its upkeep. Importantly, it financed a public works project that transformed the direction of our nation for the better.

However, American travel is evolving. Many of our organizations, along with State leaders, labor groups, and other stakeholders, have historically called on Congress to support reasonable solutions, like increasing fuel taxes to maintain the integrity of this fair and fiscally responsible framework. But Congress last adjusted the user fee in 1993 when gasoline averaged $1.11 per gallon-despite repeated warnings on the need for reform in the years since.

Today, we propose a new approach: eliminate all existing federal user fees, including gasoline and diesel taxes and the Federal Excise Tax on commercial trucks and trailers, and establish a fee based on vehicle weight regardless of powertrain type or fuel economy. This model would ensure that all vehicles contribute equitably to the HTF - regardless of fuel type - as originally intended. Additionally, it would lower the cost of commercial trucks, encourage the adoption of newer and safer vehicles, reduce costs for farmers, and place the HTF on a sustainable path.

Today, a growing number of vehicles rely on little to no gasoline or diesel fuels, and those that do are more fuel-efficient. As a result, a growing number of drivers contribute little or nothing to the HTF, while those driving older and less fuel-efficient vehicles or traveling longer distances, including rural drivers, bear a disproportionate burden. This imbalance is unfair and diverges from the original intent of the user fee system.

Moreover, the current funding levels are unsustainable. At existing levels, our nation's infrastructure has earned a "C+" grade from the American Society of Civil Engineers (ASCE). Without adequate maintenance, this rating will decline, costing American households over $2,700 annually and reducing GDP by $10.3 trillion by 2043.^[3] The U.S. needs $3.5 trillion over the next decade to bring surface transportation to a state of good repair. Yet, the revenue levels last adjusted in 1993 simply are not sufficient to keep pace with today's demands.

The HTF's current trajectory is unsustainable, but the challenge is not insurmountable. A reformed user fee system can provide fair and fiscally responsible funding for our nation's transportation infrastructure. We recognize this would represent a significant change that would require time and collaboration with states and others to make the transition, but we believe this is a worthy challenge and presents an important opportunity. We look forward to working with you to advance our proposed solution and secure the long-term success of America's transportation network.

Thank you for your attention to this critical issue.

Sincerely,

Alliance for Automotive Innovation

American Highway Users Alliance

Association of Equipment Manufacturers

Associated General Contractors of America

American Public Transportation Association

American Road & Transportation Builders Association

American Shortline and Regional Railroad Association

FP2, formerly the Foundation for Pavement Preservation

National Association of Wholesaler-Distributors

Truck and Engine Manufacturers Association

U.S. Chamber of Commerce