Letter to the Honorable Ron Wyden
Three questions regarding the status of the Highway Trust Fund:
Based on the most recent information from the Department of Transportation (DOT) about the trends in spending from the Highway Trust Fund and revenues credited to the trust fund, CBO estimates that additional revenues of about $8 billion would be needed for the Highway Trust Fund to meet all the obligations that are likely to be presented to the fund during the remainder of calendar year 2014 while maintaining the minimum cash balance DOT requires to manage the fund. That estimate reflects an assumption that the provisions of the Moving Ahead for Progress in the 21st Century (MAP-21) would be extended through December 31, 2014.
The above estimate reflects the assumption that funding for the Highway Trust Fund in fiscal year 2015 continues at the same level provided in 2014, adjusted for inflation, and that the provisions of MAP-21 are continued through December 31, 2014. CBO estimates that outlays from the trust fund will exceed revenues by about $10 billion from the end of May to the end of September this year; as a result, the trust fund will probably end fiscal year 2014 with a combined balance in the two accounts of about $1 billion. CBO projects a shortfall of $4 billion in the first quarter of fiscal year 2015. Because DOT has indicated that it needs $5 billion in cash ($4 billion in the highway account and $1 billion in the transit account) to make payments in a timely fashion, CBO estimates that the Highway Trust Fund would need roughly $8 billion to maintain that balance and meet obligations through the end of the calendar year.
According to estimates provided by staff of the Joint Committee on Taxation, increasing the gasoline and diesel fuel tax by $0.06 per gallon for the final five months of calendar year 2014 would generate about $4 billion in additional revenues above the amounts projected under current law. CBO estimates that those additional revenues would not be adequate to prevent a shortfall in the Highway Trust Fund, and that DOT would need to slow reimbursements to local governments even if those additional revenues were realized.