Infrastructure

Republicans and Democrats Endorse Concept, but Gloss Over Details, of Funding Infrastructure With User Fees

A federal mileage-based user fee is still years away, and there's very little political support for a federal gas tax hike.

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Republicans and Democrats are eager to pass some sort of infrastructure bill. They also might be converging on a means of paying for it.

On Thursday, Axios reported that several prominent Democrats have endorsed the idea of increasing user fees to help pay for any new infrastructure spending. "User fees have to be part of the mix," Sen. Mark Warner (D–Va.) told the publication.

Warner's comments match those of Sen. Tom Carper (D–Del.), chairman of the Senate Environment and Public Works Committee (which handles most infrastructure issues), who said at a Brookings Institution event in April that "things that are worth having are worth paying for and those that use roads, highways, and bridges have an obligation to help pay for them."

User fees—like tolls to pay for highways and public transit fares—have been a mainstay of Republicans' infrastructure proposals. A $536 billion spending plan released by GOP Sens. Pat Toomey (R–Penn.), Roger Wicker (R–Miss.), John Barrasso (R–Wyo.), and Shelley Moore Capito (R–W. Va.) in April calls for collecting user fees on electric vehicles and redirecting already-approved federal spending.

Axios reports that Sen. Kyrsten Sinema (D–Ariz.) has also endorsed the idea of user fees.

Support for the concept of user fee–funded infrastructure is far from universal, however.

President Joe Biden, in keeping with his pledge to not raise taxes on anyone making under $400,000 a year, has rejected the idea of paying for his $2.3 trillion American Jobs Plan with user fees, including a federal gas tax hike. He's instead proposing a corporate tax hike—something Republicans' infrastructure proposal explicitly rejects.

Progressive Democrats also don't like the idea, which they say falls too heavily on the poor and middle class.

"Republicans' insistence that middle-class families and local communities foot the bill for everything from roads to water to broadband, while mega-corporations not pay a penny more in taxes isn't acceptable," said Sen. Ron Wyden (D–Ore.) in an April response to the GOP's infrastructure bill.

Even if there were a consensus of making motorists and transit riders pay for the infrastructure they use, there are still the knock-on questions of what types of user fees might be applied and how much infrastructure they'd actually buy.

The simplest policy to implement under the user fee umbrella would be a federal gas tax hike. It's also the most politically fraught.

Biden has rejected it explicitly, as has Sen. Joe Manchin (D–W. Va.). His fellow West Virginia senator, Capito, has also said no to a gas tax increase. Instead, she's floated charging drivers a mileage-based fee, reports The Wall Street Journal.

The Biden administration has thrown cold water on that idea, however. Transportation Secretary Pete Buttigieg, while agreeing the idea has "a lot of promise," said in a March CNN interview that it wouldn't be part of Biden's plan.

Several states, including Washington, Oregon, and California, are experimenting with mileage fee pilot programs. There are nevertheless a lot of practical problems with trying to implement it at the federal level.

"A mileage-based user fee is not ready for prime time," says Baruch Feigenbaum, a transportation expert at Reason Foundation (the foundation that publishes Reason). We're still years away from a federal mileage fee being feasible, he says, meaning that it can't be used to fund any short-term infrastructure plans

Republicans' other idea to impose a user fee on electric vehicles "is not going to raise that much money because there's just not that many electric vehicles," Feigenbaum says. "Right now, Republicans don't have enough of a pay-for."

The Journal reported yesterday that Biden has asked GOP senators to flesh out more ideas for funding an infrastructure proposal, meaning we could see more details on particular pay-fors soon.

Hanging over this entire debate is whether Congress will try to pass a stand-alone additional infrastructure bill like the one Biden has proposed, or instead incorporate some of those ideas into a reauthorization of existing surface transportation programs (including highway and public transportation spending) that are set to expire at the end of September.

The must-pass nature of a surface transportation bill could be a way to round up bipartisan political support for any proposal. The fact that it can't be passed by reconciliation and would thus need a full 60 votes in the Senate would also mean Biden couldn't use it as a vehicle to pass his most ambitious proposals.

One possibility would be for Biden to get as much of the traditional infrastructure parts of his American Jobs Plan put in a surface transportation bill, and then pursue stand-alone passage of his other proposals like funding nursing homes and affordable housing.

Expect much more political wrangling to come.

NEXT: Ron DeSantis Will Pardon COVID Violators. Why Stop There?

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  1. If there’s going to be user fees on the roads they should be based upon vehicle weight, not miles travelled. One pass of a big rig does more damage to a road than my car will do in a million miles.

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    2. Actually big trucks already pay much higher fuel taxes, tolls and a HVUT tax. But don’t worry. You’re actually paying that tax if you buy what they’re hauling. Which is everything you buy. More tolls won’t change that.

    3. Given that they pay 50% more per gallon and average about 6 mpg, they already pay about 10x the cost per mile that you do.

      BTW, no matter how much tax you put on commercial rigs, you’ll pay for it anyway unless of course you’re delusional enough to believe the price of goods and services you buy doesn’t go up when the cost of moving freight goes up. In that case, I won’t spoil your fantasy.

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  2. There is a simple way to pay for all the road infrastructure: the gas tax. It is already implemented It rewards those who drive less miles and drive a more fuel efficient car. It also does not provide any information about individual drivers are cars to the government. It should be raised to a level that accurately reflects the cost of maintaining roads and bridges so that that cost is clear to everyone when they are filling their tank.

    1. There is a simple way to pay for all the road infrastructure: the gas tax.

      I agree, since a gas tax even factors in the weight considerations that sarc mentions, above – a heavier vehicle needs more energy to be moved.

      A problem with gas taxes, at least the way we have them structured in CA, is that those revenues tend to get spent on anything but roads, and then when the roads need repair, we issue bonds.

      1. Well yes, that’s how government does it. They impose a tax for a specific reason, then “borrow” from it or redirect it temporarily [often because they are pulling the same scam elsewhere and those funds have been reallocated, then it finds its way into the general fund and government needs another tax to do the very thing the first tax was imposed for. It’s a big shell game and revenue just disappears faster than if it was put into a Clinton charity.

        1. ‘Government’ only does that if people themselves don’t hold that organization accountable. This is the biggest difference between classical liberals and libertarians/anarchists.

          Classical liberals basically adhere to the notion expressed by Hayek – What a free society offers to the individual is much more than what he would be able to do if only he were free

          Libertarians/anarchists basically adhere to the notion that government is alien to the individual therefore unaccountable.

          The net effect is that classical liberals believe self-governance is an ongoing activity. Libertarians believe that only the perfect initial design/structure can keep government contained and the only ‘reform’ is via a bomb.

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    2. The gas tax reliance is exactly why the US is lagging re electric vehicles and will always lag.

      1. I think some mix of a gas tax and user fees is probably the most reasonable at this time.

        1. “The way to crush the bourgeoisie is to grind them between the millstones of taxation and inflation”
          – Vladimir Lenin (and chemleft)

          1. Fake quotes attributed to a dead person we can agitprop about is the key to all successful political rhetoric – Jesus Christ (or perhaps Thomas Jefferson)

              1. Yes it is, like probably every quote you will ever reference, fake. And FFS read the link you cite.

                KEYNES said that Lenin said something else that is similar but not the same – that the way to destroy capitalism is to debauch the currency. But that doesn’t mean Lenin said that. It means that Keynes was the first one to fake a similar quote.

                The first reference to the same words is 1952 in Waukesha WI. But the attribution of that quote is to Robert Taft attributing the problem to the federal government.

                The first reference to the same words and to Lenin is 1966 from a conservative British journalist in Virginia. I’ll guess that’s the source that makes it into the Klavern’s Reference for Fake Quotes to Throw Around when You Want to Give the Impression You’ve Read Something Beyond a Comic Book.

      2. If you say so. But I’d put far more on the fact that they are completely impractical for the average American. At 250 miles before it turns into a paperweight and 10-12 hours to charge on 220, these toys are best left as an expensive second car for those needing to virtue signal.

        1. The distribution of trip length by car is:
          4% less than 1/2 mile
          57% less than 5 miles
          10% or so more than 20 miles

          And countries with actual EV infrastructure – which let me repeat is undermined by reliance on a gas tax – can recharge 100 mile range in about half an hour. Or faster. Currently. A swap out system is a very likely entrepreneurial option – but won’t work well in the US until after EV becomes mass-market and as I said the US will lag badly.

          1. Assuming the accuracy of these statistics, they can be used to justify a higher gasoline tax.

            If people are using their vehicles for such short distances they could reduce this usage either by walking or planning ahead to combine the errands so as to use them less frequently. A higher gasoline tax would visibly convey the logic thereof and should induce conformity to such a regimen.

            I don’t dispute the benefits of EVs but believe you are too optimistic about the market for them. First, the U.S. w/ its greater geographical expanse would require an exponentially greater number of charging station venues, a problem not present in, say, most European countries. Second, how many people can afford an EV? Even if the price is competitive — and I’m not “up to speed” on the comparison — many people retain their current vehicles for many years; it would take many years for a replacement model to result in EV substitution, wholly independent of the issues of cost and charging stations.

            1. First, the U.S. w/ its greater geographical expanse would require an exponentially greater number of charging station venues,

              Not really but I’m sure we’ll keep making excuses. Cities in the US are sprawled out but that is entirely a function of gasoline subsidies. Maybe suburbs in the US will always be more upscale than Euro suburbs which are often the ghetto areas. But overall there is not likely to be some inherent urban difference. Rural transportation needs are far more linear than exponential and not generally huge per-trip distances either. Fast chargers in the county seats (and at interstate ramps) and regular chargers at home are most of what is needed. North Dakota may have a lot of interstate miles compared to Connecticut or Vermont (570 v 350 v 320) but it has fewer off-ramps.

              And re market share – EV has a 75% market share for new vehicles in Norway. Many other countries (Europe mostly) are currently over 10% and ramping fast. China’s is 6% (double ours) and the low price for an EV there is now $10,000. We are laggards and we aren’t even aware how laggard we are.

          2. I recently did the math and an electric car works out to $250/year in electricity vs $750/year in gas for a hybrid.

            And the hybrid is typically much less expensive.

            It makes no economic sense.

          3. And countries with actual EV infrastructure

            Have cut less carbon proportionally than the US and were less capable of effectively offsetting China/India’s emissions to begin with.

            EVs are the vehicular way you announce to the world that you’re pretty sure your farts don’t stink.

    3. “It should be raised to a level that accurately reflects the cost of maintaining roads and bridges so that that cost is clear to everyone when they are filling their tank.”

      But politicians will, in practice, raise taxes to a level that accurately reflects their political concerns, costs be damned.

      I’ll never understand why we debate the best “wise stewardship” policies based on assumed incentives that don’t exist.

  3. You’ve already got to provide make, model and mileage when you pay excise tax. At least I do. Extrapolate damage caused to the roads based upon weight and miles instead of making grandma pay more to fill up her Tercel.

    1. That was supposed to be a reply to MG.

    2. Gas tax does correlate to millage driven and weight of vehicle. And grandma should pay to use the roads just like everyone else.

      1. Not every vehicle uses gas.

        1. She’s kinda dumb.

        2. Yes, and I am just fine for now letting those with electric cars save money as an incentive to drive a zero emission car.

          1. electric cars save money as an incentive to drive a zero emission car

            Keep deluding yourself that the coal burned to generate the electricity, and the battery manufacturing and disposal are “zero emission”.

            1. The overall emissions from an electric car are far far less then a gas powered car.

              1. Good Christ I got whiplash watching you move the goalposts from zero emissions to “far far less”. Get your writing team together, your shtick needs a shitton of work.

              2. How about the emissions to quarry up the materials including rare earth minerals, often in pristine parts of the world, and done by child labor. Are you fine with that for now too? And this of course doesn’t begin to cover disposing of the battery and the environmental costs there.

                1. You are right in that electric vehicles are not the environmental panacea that some claim that they are. So the real question is, do electric vehicles transfer the environmental problem from one that is less controllable, to one that is more controllable? If it is a question between controlling CO2 emissions from a gas-powered vehicle, to controlling how batteries are disposed of from an electric vehicle, it would seem to be easier to recycle batteries than to eliminate CO2 emissions.

            2. Presumably you could get them with a tax on electric vehicles on purchase, and a carbon tax on electricity generation. But instead we’ve been subsidizing purchases of electric cars, because we’re idiots.

          2. And zero emission cars don’t cause any road wear? Idiot.

  4. The only ways to calculate milage is to either require an annual mileage check, signed off by some state agency, or by the use of GPS transmitters. The transmitters will quickly decide not only how far the car has travelled, but where it is at any time. What could go wrong?

    1. You can spoof GPS signals.

      1. Wouldn’t have to spoof. Park the car in the garage, disable GPS, drive as you please.

    2. Texas already records the odometer every year as part of the annual safety inspection.

      1. You can slip Bubba the inspector an extra 20 and he’ll write down whatever you want for mileage.

    3. Gov gonna make zero from me when it notices that the GPS unit never leaves the garage.

      1. Damn, shoulda scrolled down.

  5. There’s plenty of tax money for infrastructure (not the creepy kind promoted by idiot dems).

    The problem is welfare and warfare suck up all that tax money and leave just enough to fix potholes. Also environmental impact statements and lawsuits fuck up the building of new infrastructure. Government will step all over themselves to screw around.

    1. They’d rather spend all that money subsidizing the President’s toy train from Delaware to DC.

    2. The problem is welfare and warfare suck up all that tax money and leave just enough to fix potholes.

      Not around here – we have potholes galore.

  6. “things that are worth having are worth paying for and those that use roads, highways, and bridges have an obligation to help pay for them.”

    I agree completely and I’ll gladly support raising the gas tax – as soon as you tell me what the fuck you did with the 5 trillion dollars we gave you last year. Who the fuck do you think pays for the roads, highways, and bridges we have now?

    1. Tony will tell you the government paid for them.

  7. If they really believe that spending can be infinite, taxes should be 0.

    1. You’re onto something there. Who the hell needs tax revenue when you’re just making the shit up as you go anyway? The cost of making digital zeros is next to nothing, so let’s just keeping making more of them. Damn… I think I finally understand political accounting. It’s just like GAAP, but without generally accepted part and like the politicians that do it, obviously with no principles either.

  8. I’m all in for tolls, as long as they stay with the road they were collected on.

    1. New roads only and once they’re paid off the tolls end and fuel taxes fund the maintenance.

    2. Not exactly disagreed but, recommend googling “Toll-free in ’73!” before sticking with your position. Coming up on paying for roads a half-century after they should’ve been paid off.

  9. Tolls for bike paths and jogging trails, too.

  10. They also might be converging on a means of paying for it.

    Well if D’s and R’s agree on the way to pay for it – you can guarandamntee that the donor class ain’t paying for anything. Except maybe the spin and PR and polls and consultants to sell it.

  11. In the USSR’s Nazi Confederate Constitution.

    Nazi (def; National Socialist) leaders shall have the power to ‘steal’ from working people for their $T (as in TRILLIONS) pet infrastructure delusions.

    Where the F did the USA go?

    1. Oh FFS. This is why normal people think libertarians are just cranks. Providing physical infrastructure is literally one of the few things that even most minarchist libertarians can agree on as a proper role, or at least relatively inoffensive role, for government. Do you think we can lay off the NAZI allusions for government building roads and bridges?

      1. Depends; Is the Union Government doing it or is the State, City or County Government?? You know what they call a one government limitless nation? An absolute monarchy. Is the USA suppose to be an monarchy??

        Perhaps that’s the problem; More and more Anti-American people moving into the USA trying to turn it into the sh*thole they just escaped from.

        What do they call that when a person keeps doing the exact same thing and expecting a different result? Oh yeah; I remember they call them STUPID!

      2. That’s not my impression. And why would national infrastructure be OK? If government can take property by fiat, taxation surely can’t be theft, and nothing it pays for should be objectionable as long as it’s less intrusive than a giant concrete span slicing through your pasture. A check in the mail for hungry children seems positively anarchist.

    2. Article 1, section 8; to establish Post Offices and post Roads

      1. Oh so it’s nothing more than a few USPS offices and a mandatory road to deliver mail that doesn’t already exist??

        Ya F-en right.. UR delusional.

  12. Jesus fucking Christ, these plutocratic zombies couldn’t smell the air if a horse shit on their face. “User fees,” otherwise known as a gas tax, otherwise known as a regressive tax. Guess the richest 0.01% just aren’t rich enough for the sake of national security yet.

    Republicans are rather free, on balance. Sure, if they don’t lick Donald Trump’s taint with their every tongue wag, they will be actually murdered by his crazed followers. But at least it doesn’t fucking matter what they say anymore. A gas tax? Sure, that’ll work for our donors.

    As long as they lick the Trump taint, they can be for anything they want. Just keep licking, and nobody will try to shoot them in the head again.

    Democrats, though, what corpses. It’s like going back to the movies after a pandemic. It’s all pretty much the same as it was. There was no attempted coup. There’s no 90% support for tax hikes on the rich. There’s just DC, and Republicans are Lucy with the football with their “proposals,” only Lucy has a gun to her head which will be fired if she doesn’t worship Donald Trump at literally every moment.

    Decaying old men always prevent progress, and when progress is necessary for survival, they get lots of people killed with their stupidity.

  13. Kind of odd that nowhere here is there a distinction between the costs of building a road network v maintaining a road surface. Completely different cost structures and beneficiaries.

    Best way to build the road network is debt (govt since that is always the lowest cost debt) with a sinking fund to pay that off based on a land tax on landowners within a certain radius of the access points to that road network. If the landowners near that road network don’t see the increased land value resulting from the new EXISTENCE of that network, then the road should not be built period.

    Maintenance of road surface is fine for a user fee but that fee should not be paying off the construction debt. Maintenance can always be pre-funded – and usually postponed if necessary to a time when costs are cheaper like during recession – and does not require debt of any significance.

    1. > If the landowners near that road network don’t see the increased land value resulting from the new EXISTENCE of that network, then the road should not be built period.

      I dunno. Maybe the interstate generates more value for the cities on the ends than the ranchers in the middle? Maybe it even destroys value when it redirects traffic from small towns?

      1. That’s fine. Then eliminate the off-ramps. If the cities at the ends can still realize the increased value, then they pay for it. If not, it doesn’t get built.

        What wouldn’t happen is the bullshit. Where those at the off-ramps whine that there’s no increased value and then whine if there’s no exit.

    2. Kind of odd that nowhere here is there a distinction between the costs of building a road network v maintaining a road surface. Completely different cost structures and beneficiaries.

      Almost like once a source of revenue has been tapped, zero fucks are given about actually providing the indicated service or giving up the revenue.

      1. Those landowners who lobbied for the highway – immediately turn around and sell their undeveloped land for a higher price. At most they’ve paid one year of an increased land tax. It is the NEXT owner who pays the land tax and holds govt accountable as they then also develop their land to take advantage of whatever development is now most profitable there.

        It is the CURRENT system that turns one corrupt crony into another and another and another. Until pretty soon assholes like you think rent-seeking and cronyism is how competitive markets actually work.

  14. McCarthy needs to accept that gas taxes need to be raised to pay for whatever actual road repair/building comes out.
    He can also negotiate the corporate tax increase downward.
    It’s just not that tough…

  15. You know what we don’t need? Another type of tax.

    1. Yeah, this is yet another example of Reason’s perpetual idiocy.
      More immigration (at the same tax/welfare structure)!
      UBI (at the same tax/welfare structure + more immigration)!
      Infrastructure fees (at the same tax/welfare structure + more immigration + UBI)!

      It’s almost like they’re just as rabily fascist and illiberal as the shittiest left-wing nutjobs.

    2. But if we are going to spend money on roads, the fairest way to fund it is through charging the people who use the roads.

  16. Well yes, that’s how government does it. They impose a tax for a specific reason, then “borrow” from it or redirect it temporarily [often because they are pulling the same scam elsewhere and those funds have been reallocated, then it finds its way into the general fund and government needs another tax to do the very thing the first tax was imposed for. It’s a big shell game and
    https://wapexclusive.com/covid-19/ revenue just disappears faster than if it was put into a Clinton charity.

  17. “User fees—like tolls to pay for highways and public transit fares….”

    Don’t these imbeciles see how stupid this is?

    Highway users pay for roads proportional to their use of roads while transit users are subsidized by highway users.

    It’s the antithesis of the “user pays” principle.

  18. Republicans and Democrats Endorse Concept, but Gloss Over Details, of Funding Infrastructure With User Fees

    Which would seem to be the libertarian position. Both sides!

  19. Roads should be funded 100% by user fees.

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