Surface Transportation Devolution (CRS Report for Congress)
Premium Purchase PDF for $24.95 (16 pages)
add to cart or
subscribe for unlimited access
Pro Premium subscribers have free access to our full library of CRS reports.
Subscribe today, or
request a demo to learn more.
| Release Date |
Revised April 12, 2017 |
| Report Number |
R44811 |
| Report Type |
Report |
| Authors |
Robert S. Kirk |
| Source Agency |
Congressional Research Service |
| Older Revisions |
-
Premium April 2, 2017 (16 pages, $24.95)
add
|
Summary:
Surface transportation “devolution” refers to shifting most current federal responsibility for
building and maintaining highways and public transportation systems from the federal
government to the states. Devolution legislation has been introduced in each Congress since the
mid-1990s, supported by Members who regard the federal government as being overinvolved in
highways and public transportation. Under such proposals, the federal taxes that now support
surface transportation programs, mostly fuels taxes, would be reduced in line with the shift of
responsibility to the states. The states could then raise their own taxes to pay for highway and
transit projects as they see fit. A small program, funded by much-reduced motor fuel taxes, would
remain in place at the federal level to maintain roads on federal lands, fund highway safety
efforts, and support other programs Congress decides not to devolve.
Beyond the basic small government argument, advocates of devolution generally assert that it will
lower costs and accelerate construction of highway and transit projects by freeing them from a
wide variety of federal regulations. They also contend that devolution will be fairer than the
present systems for distributing highway and public transportation funding, which give some
states more money, relative to their residents’ motor fuel tax payments, than other states.
Opponents of devolution question whether it will save money and worry that it could interfere
with national goals established by Congress, such as maintaining important interstate freight
corridors and adhering to uniform national construction standards. They point out that the last two
surface transportation reauthorization acts have greatly reduced the number of programs and
given states greater control over highway expenditures while excluding earmarks, addressing
some of the complaints that originally led to calls for devolution.
There are several significant issues Congress would face if it were to consider devolution. Among
them are the following:
Devolution would involve substantial upfront costs, possibly as much as $84
billion over a period of several years, to pay for outstanding highway and transit
obligations. Even if the federal government hands responsibility for funding new
highway and public transportation projects to the states, it would need to retain
federal motor fuels taxes or some other revenue source until it has repaid the
states for projects in progress as of the date devolution takes effect.
Replacing the reduced federal taxes on a cent-for-cent basis would not provide
enough revenue to fund the current level of spending on surface transportation.
Nearly all states would have to increase their taxes by an amount larger than the
reduction in federal taxes, unless they choose to reduce spending.
Devolution would likely increase the use of tax-exempt bonds by the states,
reducing federal revenue beyond the amount of forgone highway taxes.
