[Congressional Record Volume 143, Number 64 (Thursday, May 15, 1997)]
[Senate]
[Pages S4600-S4601]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. THURMOND (for himself, Mr. Coats, Mr. Hollings, Mr. Helms, 
        Mr. Faircloth, and Mr. Hutchinson):
  S. 752. A bill to amend title 23, United States Code, to modify the 
minimum allocation formula under the Federal-aid highway program, and 
for other purposes; to the Committee on Environment and Public Works.


                     highway trust fund legislation

  Mr. THURMOND. Mr. President, I rise today to introduce legislation to 
revise the formula by which the highway trust fund is apportioned and 
distributed to the States under the Federal Aid to Highways Program. 
This measure is cosponsored by Senators Coats, Hollings, Helms, 
Faircloth, and Hutchinson from Arkansas.
  The current formula was established in 1956 to support the building 
of a nationwide, interstate highway system. At that time, it was 
necessary to redistribute the tax revenues from some States to those 
with large land areas and low population. As it exists now, the present 
formula is inefficient and unfair. It is inefficient because it is 
based upon population statistics that were current in 1980. There is no 
allowance for population shifts in the future and, as a result, high 
growth areas of the country are left on their own to provide the 
infrastructure to support growing populations. It is unfair because the 
disparity in the rates of return creates a policy that, in effect, 
values a mile of road in one State three times as much as a similar 
mile of road in another State.
  Mr. President, the interstate highway program has been an enormous 
success and is now virtually complete. However, the circumstances which 
gave rise to the present formula have changed and it is now time for a 
new one. Our legislation corrects both the inefficiency and unfairness 
of the current formula. It amends the law to provide that the minimum 
annual allocation to each State from the highway trust fund be equal to 
that State's share of contributions to the fund. This formula will 
allocate funds where they are most needed. The General Accounting 
Office, in a November 1995 study, noted that highway trust fund 
contributions bear a high correlation to the need for highway funding 
in a given area. Moreover, under this new formula, as population grows 
and economic activity increases, additional infrustructure funding will 
be available.
  Mr. President, this bill presents a fair and workable formula for 
distributing funds under the next highway bill. I urge my colleagues to 
join us in support of this legislation.
  Mr. President, I ask unanimous consent that a copy of the legislation 
be printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 752

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. MINIMUM ALLOCATION.

       (a) Fiscal Year 1998 and Thereafter.--Section 157(a) of 
     title 23, United States Code, is amended by adding at the end 
     the following:
       ``(5) Fiscal year 1998 and thereafter.--In fiscal year 1998 
     and each fiscal year thereafter, on October 1, or as soon as 
     possible thereafter, the Secretary shall allocate among the 
     States amounts sufficient to ensure that a State's percentage 
     of the total apportionments in each fiscal year and 
     allocations for the prior fiscal year from funds made 
     available out of the Highway Trust Fund is not less than 100 
     percent of the percentage of estimated tax payments 
     attributable to highway users in the State paid into the 
     Highway Trust Fund in the latest fiscal year for which data 
     are available.''.
       (b) Conforming Amendment.--Section 157(a)(4) of title 23, 
     United States Code, is amended by striking the paragraph 
     designation and all that follows before ``on October 1'' and 
     inserting the following:
       ``(4) Fiscal years 1992-1997.--In each of fiscal years 1992 
     through 1997,''.

  Mr. HOLLINGS. Mr. President, today I am proud to join Senator 
Thurmond in introducing legislation to bring fairness to Federal 
transportation funding. This legislation would guarantee that the 
Federal Government would return to each State the same share of gas tax 
funds that it had paid into the transportation trust fund.
  In 1991, I voted against the current transportation law, known as 
``ISTEA.'' Supporters advocated the legislation as a forward-looking 
consolidation of Federal highway programs, but the heart of the bill--
the way it distributed money--looked backward in every sense. It 
tightly tied each State's future funding to past funding levels. It 
used old census data. It used old formula factors which do not even 
pass the ``straight face'' test. As the GAO reported, ``the Congress 
elected not to change the basic formula structure'' and thus the key 
factors in

[[Page S4601]]

the formula are ``irrelevant'' and ``divorced from current 
conditions.'' In other words, we are currently targeting more than $20 
billion of taxpayer funds to the wrong places for the wrong reasons.
  South Carolina bears the brunt of this inequity. In 1995, South 
Carolina received only 52 cents back for each dollar it paid to the 
highway trust fund. Over the period of ISTEA, South Carolina received 
only 70 cents back on the dollar. Let me add that I am not unaware of 
the overall Federal funding situation in South Carolina. South Carolina 
gets back more Federal tax money than its citizens contribute. Mr. 
President, that is as it should be. We are one Nation, and some parts 
of the Nation have lower average incomes. That is no excuse for 
targeting highway funds in a way that an objective study found to be 
``irrelevant'' and ``divorced from current conditions.''
  It is rare that a $20 billion problem has a simple solution. I refer 
again to the independent assessment of the GAO, which said that basing 
Federal payments to States on the amounts States paid in would, would 
meet two major, commonsense objectives of any highway program:
  First, it would be a ``relatively simple and direct method of fund 
distribution.''
  Second, it would ``tend to correlate highly with highway needs, 
particularly for major highways.''
  Furthermore, the GAO found that basing funding on gas tax paid in 
would effectively kill two birds with one stone by accounting for 
highway needs and for equity between States with one formula factor.
  Mr. President, a program that does not target funds to today's needs, 
and which mires States and the Congress in arcane complexity, cries out 
for revision. The legislation we introduce here today is a good 
starting point to better address our Nation's highway needs. I urge my 
colleagues to join us in supporting this bill.
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