President Trump is pitching a $1.5-trillion infrastructure program, but he’s left lots of details about how it would be funded and what it would build unanswered.
That’s the assessment of a broad segment of the trucking and logistics industry.
“Funding remains the main obstacle to seeing an infrastructure package transition from an intention to an outcome,” Mike Steenhoek, executive director at the Soy Transportation Coalition, told Trucks.com.
Steenhoek sees a “fundamental flaw” in how the U.S. funds roads and bridges. Improvements are dependent on gas taxes.
“We have a fixed source of revenue trying to meet the needs of an escalating cost,” he said.
Crumbling infrastructure remains a nagging and lingering issue for freight movement.
U.S. infrastructure received a D+ rating in the 2017 Infrastructure Report Card released by the American Society of Civil Engineers. In the report, the group said there is a $2-trillion investment gap.
Worsening traffic congestion costs the trucking industry more than $63 billion in operating expenses annually, according to the American Transportation Research Institute, the research arm of the American Trucking Associations. The expenses include wasted fuel, labor costs and wear and tear on vehicles.
Trucks.com spoke with trucking and logistics leaders to survey what they see as the greatest infrastructure needs.
Shipping giant UPS sees traffic congestion as the biggest issue. A stretch of highway near Atlanta called “Spaghetti Junction,” near UPS’ headquarters tops the list of the worst bottlenecks in the U.S. for the third consecutive year.
“If every UPS vehicle is delayed due to congestion five minutes a day, every day, it would cost the company $114 million annually,” Glenn Zaccara, spokesman at UPS, told Trucks.com.
On average, UPS delivery drivers in New York and Northern New Jersey are delayed 16 minutes per day because of traffic congestion, Zaccara said.
“Since 2010, UPS has had to dispatch an additional 61 delivery drivers every day to meet customer service obligations in this geographic area due to traffic gridlock,” he said.
During his campaign and again in last week’s State of the Union address,Trump highlighted infrastructure spending as a priority.
But freight and logistics leaders say they are still waiting to learn his administration’s plans for bolstering the nearly insolvent Highway Trust Fund.
It is the major source of funding for public roads, highways and bridges in the U.S. Its main source of revenue is the federal gas tax, which has not been raised since 1993.
Barring a cash infusion, the Highway Trust Fund may become insolvent by fiscal year 2021, according to the Committee for a Responsible Federal Budget.
The ATA is concerned.
It’s proposed a “Build America Fund” infrastructure plan to help generate revenue for the Highway Trust Fund.
It wants to raise federal fuel taxes by five cents annually for four years to shore up the Highway Trust Fund. The plan would generate $340 billion in new revenue over the first 10 years, the ATA said.
“Trucking already pays half the nation’s highway funding tab, and we are ready to pay more,” said Chris Spear, president at ATA.
Spear says this is a direct way to fund infrastructure improvements. The trade group is against what he called “create financing tools” and tolls.
There’s widespread support for that position in trucking.
“Tolling is a non-starter for all of the trucking industry,” Joe Rajkovacz, director of governmental affairs at the Western States Trucking Association, told Trucks.com.
His organization also supports raising fuel taxes to bolster the Highway Trust Fund.
But Rajkovacz wants the money spent on repairing crumbling roads and curbing traffic congestion, rather than “green projects such as building bike paths.”
“We can’t have first-world highways when dodging potholes and sitting in endless traffic jams simply because we refuse to build the roads needed for a growing country,” he said.
Besides ensuring the Highway Trust Fund remains solvent, funding for additional truck parking is a priority that the Owner-Operator Independent Drivers Association wants to see addressed in Trump’s infrastructure plan.
“The truck parking shortage is critical,” said Norita Taylor, spokeswoman at OOIDA. “We hope that the administration and Congress are able to make infrastructure the highest priority.”