By Raju Chebium, Gannett Washington Bureau
WASHINGTON -- Coachella Valley officials plan to build a new bridge and make other congestion-easing improvements at Interstate 10 and Jefferson Street in Indio beginning in spring 2015. But that $68 million project could be pushed back unless Congress shores up the federal Highway Trust Fund.
The same fate could befall future phases of the ongoing $209 million effort to increase safety and reduce congestion on U.S. Highway 101 in Monterey County's Prunedale community. That is, unless Congress agrees on at least a short-term strategy to prevent the fund from going broke.
Those and numerous other future road, bridge and transit projects throughout California are in jeopardy because the highway fund is paying out more than it takes in due to a steady decline in its main revenue source -- federal fuel-tax receipts.
The fund will run out of money by Oct. 1, at the start of the 2015 fiscal year, according to the Congressional Budget Office.
The Department of Transportation says the fund will dip below $4 billion by July -- the minimum amount the Obama administration says it needs to help states meet day-to-day expenses like paying contractors for work they've already performed.
Though lawmakers have known about the problem for years, the deeply divided Congress has been unable to find a solution that would please Democrats and Republicans.
Sen. Barbara Boxer, who oversees federal transportation programs as chairwoman of the Senate Environment and Public Works Committee, frequently sounds the highway fund alarm.
"States are cutting back on construction projects they plan to go forward with in the spring and this trend will only continue to get worse as we get closer to insolvency," Boxer said last month.
If Congress doesn't act soon, states can expect "cash flow problems during the critical summer construction season," she said.
In February, Boxer had a blunt message for the American Association of State Highway and Transportation Officials, or AASHTO.
"A fund that's been in place since 1956 . . . is threatened with extinction," she said.
Congress needs to inject $15 billion-$17 billion to keep the highway fund alive over the next year, according to Jim Tymon, AASHTO's chief operating officer.
If not, all the federal gas-tax revenue generated in fiscal year 2015 "would have to go to pay for existing projects that are under way," he said. "If Congress does nothing for the Highway Trust Fund before the beginning of the (new) fiscal year, there won't be any new federal money for highway and transit projects."
The fund's dire finances create uncertainty for state and local officials who need to know now what they can expect from Washington before they can plan for projects that will begin years later, advocates say.
California officials aren't panicking -- at least, not yet -- because Congress has averted trust-fund shortfalls in the past, often at the last minute. Since 2008, Congress has moved $52 billion from general revenue accounts into the highway fund. Tymon said that's likely to happen this year as well.
John Standiford, deputy executive director of the Riverside County Transportation Commission, said the agency hasn't yet analyzed the potential effects of a federal funding shortfall or planned for that scenario.
"Maybe we could move money around until the federal money is restored," Standiford said. "It's unclear as to how profound that impact could be or when it would actually happen."
The highway fund's woes are worrisome but state and local officials have grown used to congressional inaction until the balance gets dangerously low, he said.
"We have been near the brink of this in the past. It is kind of a drama," Standiford said. "That's why we've taken positions in our legislative platform that we advocate predictable federal funding. Right now, the situation is far from that."
California's share of the highway trust fund has fluctuated over the years. According to the Federal Highway Administration, the state got $4.04 billion in fiscal year 2009, $3.99 billion in 2010, $3.94 billion a year later and $4.13 billion the following fiscal year.
Nearly every California transportation project gets some level of federal support.
For instance, nearly $48 million of the $68 million construction cost for Indio's Jefferson Road project will come from Uncle Sam, according to Standiford. An interchange-construction project at I-10 and Monterey Avenue -- for which groundbreaking was Friday -- will cost $8.3 million, of which $2.7 million will come from Washington.
A transfer from general revenue into the highway fund would provide only short-term relief, advocates warn.
They want Congress to come up with a permanent solution to the fund's revenue problem so Uncle Sam can continue to help state and local agencies improve and expand the nation's transportation system.
Transportation Secretary Anthony Foxx echoed that view.
"America needs a long-term transportation bill that will not only replenish the Highway Trust Fund but promote new approaches that will help our country grow its economy, create new jobs and support its people well into the future. Earlier this month, the Department of Transportation announced a proposed budget that will do exactly that, all without adding to the deficit," he said in a statement.
He was referring to President Barack Obama's 2015 budget request to Congress, which seeks $300 billion over four years for transportation by reforming the corporate tax system. Obama and Rep. Dave Camp, a Michigan Republican who heads the tax-writing House Ways and Means Committee, have both recommended that route.
But that idea is unlikely to pass muster with tax-averse Republicans and conservative Democrats.
Debbie Hale, executive director of the Transportation Agency for Monterey County, said she prefers a permanent fix but will accept a temporary infusion of cash so road crews can get to work this summer. A short-term fix would also allow Congress to find a long-term answer after the 2014 mid-term elections, she said.
If Congress doesn't beef up the highway fund by this summer, the Prunedale project could be delayed by up to a year, continue being a "perpetual construction zone," and potentially exceed its budget, she said.
To improve traffic safety and ease congestion in Prunedale, the project involves eliminating several left turns and putting up barriers and medians along Frontage Road, she said.
But if Uncle Sam doesn't help pay for the work, her agency may have to pull money out of other county projects, Hale said.
The highway fund has been shrinking as the nation's infrastructure deteriorates. Less tax revenue is coming in because people are driving less and vehicles are getting more fuel efficient.
Congress also hasn't raised the federal gas tax for 21 years -- it has remained at 18.4 cents per gallon for passenger vehicles since 1993. The federal diesel tax has also remained steady at 24.4 cents per gallon.
Most states have higher gas and diesel taxes compared to the federal government.
California's rate is 39.5 cents a gallon for gasoline and 10 cents a gallon for diesel; these are tacked onto to the federal fuel taxes. Motorists in California also pay an additional 1.4 cents per gallon of gas or diesel in underground storage tank fees. The gas tax will drop to 36 cents a gallon in July.
Congressional Republicans have rebuffed repeated attempts to increase federal fuel taxes despite bipartisan appeals to increase them.
Other ideas like linking fuel taxes to the number of miles motorists drive haven't caught on at the federal level, though some states are beginning to experiment with new ways of paying for transportation projects.
Some lawmakers have proposed taxing oil companies for each barrel they produce, but that's a non-starter with Republicans and some oil-state Democrats.
Contact Raju Chebium at email@example.com; Twitter: @rchebium