Maverick Transportation Chief Executive Officer Steve Williams is willing to pay a higher tax on diesel fuel. As he sees it, a higher tax beats the alternative.
Williams expressed his support for raising the fuel tax -- unchanged since 1993 -- during an event this week attended by Transportation Secretary Anthony Foxx, Vice President Joe Biden and White House staff members. Williams was among 40 CEOs and executives invited to the event by Business Forward, an advocacy group in Washington D.C.
They gathered to discuss infrastructure funding in the United States. Williams, whose North Little Rock company is one of the 100 largest for-hire carriers in the U.S., is among those in the trucking industry who view a higher fuel tax as favorable to the costs associated with highway congestion.
Biden and Foxx met with the executives to outline the $302 billion Grow America Act, which would increase funding to the Highway Trust Fund. Congress is considering short-term fixes to pump more money into the fund, which helps reimburse states for work on the nation's interstates. Projections have the fund dipping below $4 billion in August, with more than $6 billion already committed for projects.
If Congress doesn't adopt a fix, states could begin to see cuts in money for road projects.
"It is imperative we not only deal with the short-term consequence of the Highway Trust Fund, but my interest is more about a strategic plan for the national transportation strategy," Williams said. "We need to have an apolitical arrangement for infrastructure going forward. It was a candid conversation. It was an intelligent conversation.
"There has been political resistance to raising the fuel tax since 1993," Williams said. "People are wanting to evaluate to other alternatives, but the fuel tax is the most efficient methodology."
The federal tax on gas is capped at 18.4 cents per gallon for regular fuel and 24.4 cents per gallon for diesel. Strides in fuel efficiency and alternative fuels have, along with inflation, limited the money generated by the tax and, according to proponents of a higher fuel tax, limited infrastructure improvements.
Earlier this year, a bill was introduced in Congress that projected a 12-cent fuel tax increase in the next two years could generate more than $160 billion. That money could be used to limit congestion on highways and delays in the supply chain for shippers.
A study by the American Transportation Research Institute estimates the trucking industry lost $9.2 billion in operational costs in 2013 because of congestion. Delays totaled more than 141 million hours of lost time, the equivalent of "over 51,000 truck drivers sitting idle for a working year."
Industry groups like the Arkansas Trucking Association have advocated for an increase in fuel taxes to alleviate deficits in funds for road projects.
"We can't buy and maintain the interstates we have with the money that was generated in 1993," Arkansas Trucking Association President Shannon Newton said. "The industry desires to invest more money in infrastructure, but the mechanism for doing that requires congressional action. There are costs associated with an inefficient infrastructure."
Foxx expressed concern that congestion would only worsen as the country's population grows and as businesses, like Wal-Mart, continue to make a push for more American-manufactured products. There is potential, Foxx said, for increased traffic on the highways, which would create additional infrastructure needs.
"We're going to have to be able to move commodities around the country. Our surface system is a critical piece of that infrastructure," Foxx said. "I can't say it loud enough and often enough."
Business on 07/11/2014