Chart of Federal Highway Trust Fund - PDF

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					                         Federal Highway                       Indiana and TEA-21
                         Trust Fund                               On June 9, 1998, President             The second provision that
                                                               Clinton signed TEA-21 into law.        increased Indiana’s funding was a
                             The Federal Highway Trust Fund    The legislation authorizes the         minimum guarantee on its rate of
                         is the primary source of funds for    federal-aid highway, transit, safety   return from the highway trust fund.
                         federal surface transportation
Federal                  programs. Below is a chart from the
                         Federal Highway Administration
                                                               and research programs charged
                                                               with maintaining and improving the
                                                               nation’s surface transportation
                                                                                                         Indiana’s federal highway funds
                                                                                                      increased an average of $261
                         showing sources of revenue to the
Highway                                                        system. The Indiana Department of      million per year over the average of
                         highway trust fund by category for    Transportation supports the legisla-   the ISTEA years. INDOT, cities and
                         fiscal year 2000.                     tion for its equity, flexibility and   counties share these federal funds.

Revenue                     Highway Account Revenues
                            for Fiscal Year 2000
                                                               budget protections.

                                                                  Two provisions of TEA-21
                                                                                                         The graph below shows the
                                                                                                      amount of funding Indiana received
                                                               provide increased funding for          from ISTEA/TEA-21 between 1993
                                                               Indiana. The legislation provides a    and 2003.
                                                               guaranteed level of funding for
                                                               fiscal years 1998 to 2003 by taking    ISTEA/TEA-21 Funding
                                                               highway and transit program            (in millions)
                                                               funding “off budget”. This means
                                                               that these programs no longer have
                                                               to compete with other federal
                                                               priorities for scarce dollars.

                                                                  Because of the off budget provi-
                                                               sions, transportation agencies know
                                                               the minimum funding they will
                                                               receive through the life of TEA-21
                                                               and can better plan for future
Indiana’s Rate of Return
    Before the passage of TEA-21,           With the expiration of TEA-21      Fiscal Year 2002 Rate of Return on Contributions to
Indiana received only 78 percent of      due on September 30, 2003, Indiana        the Federal Highway Trust Fund (in millions)
its share of contributions to the        continues to work toward an
Federal Highway Trust Fund back to       equitable distribution of the
use for highway maintenance and          federal highway dollars, while
construction, one of the lowest          continuing the protections
percentages in the nation. It would      given towards the highway
seem equitable for a state to receive    trust fund. Indiana is again
back from the federal government         seeking a guaranteed 95
an amount proportionately equal to       percent minimum return for
the taxes it paid into the trust fund.   every state on its share of
However, until recently, states          contributions to the highway
received distributions from the fund     trust fund, and applied to all
in widely varying amounts as a           of the distributions from the
result of the complex laws and           highway trust fund to the
formulas governing these monies.         states.

   Therefore, Indiana joined with a         Every state has significant
coalition of states to ask Congress      transportation needs that
for a more equitable distribution of     must be met with the user
the gas taxes paid by each state, at     fees paid by their drivers
a minimum of 95 percent. Con-            both on the state and
gress responded with a significant       federal levels. By building
increase in the guaranteed rate of       on the successes of
return, increasing it to 90.5 percent.   TEA-21, each state can
This allowed Indiana to make the         invest in and solve the infrastruc-
necessary preservation and               ture needs of its citizens and its
improvements to the highway              industries, merely by using the
system to maintain the mobility and      funds that citizens and industries
safety of the traveling public.          paid in the first place.

Description: Chart of Federal Highway Trust Fund document sample