Post on 19-Jan-2016
Trucking Industry Perspectives Trucking Industry Perspectives on on
Transportation FundingTransportation Funding
Greg OwenGreg OwenHead CoachHead Coach
Ability/Tri-ModalAbility/Tri-Modal
Talking Freight – December 16, 2009Talking Freight – December 16, 2009
Top Five Trucking Industry Top Five Trucking Industry IssuesIssues
Based on ATRI’s 2009 survey of industry:Based on ATRI’s 2009 survey of industry:
1.1. The EconomyThe Economy
2.2. Government RegulationGovernment Regulation
3.3. Fuel IssuesFuel Issues
4.4. Congestion/ Highway Congestion/ Highway InfrastructureInfrastructure
5.5. Hours of ServiceHours of Service
Key Trucking RealitiesKey Trucking Realities
Deregulated?Deregulated? HOS/Equipment/Routing/InsuranceHOS/Equipment/Routing/Insurance
Highly Competitive/ Low Profit MarginsHighly Competitive/ Low Profit Margins 640K Carriers with U.S. DOT; <100K in last 5 640K Carriers with U.S. DOT; <100K in last 5
yearsyears Critical to US EconomyCritical to US Economy
68% of Tonnage; 86% of Revenue68% of Tonnage; 86% of Revenue 6%-7% of GDP6%-7% of GDP
7% of vehicles; 15.5% of VMT7% of vehicles; 15.5% of VMT
Transportation Funding Transportation Funding IssuesIssues
Congestion is worseningCongestion is worsening
Vehicle miles traveled Vehicle miles traveled are expected to increase are expected to increase more than 72% by 2025more than 72% by 2025
Transportation system Transportation system investment is needed:investment is needed: Research suggests the Research suggests the
need for over $100B need for over $100B annually simply to annually simply to “maintain” infrastructure “maintain” infrastructure up to $200B annually by up to $200B annually by 20152015
Proposed & Existing Proposed & Existing Highway Funding OptionsHighway Funding Options
Motor Fuels TaxMotor Fuels Tax TollingTolling Highway Privatization w/ Highway Privatization w/
TollingTolling Mileage Based TaxMileage Based Tax
All Options Will Draw Revenue from TruckingAll Options Will Draw Revenue from Trucking
Trucking Trucking Perspective on thePerspective on theMotor Fuels TaxMotor Fuels Tax
Motor Fuels Tax RealitiesMotor Fuels Tax Realities
No increase in federal motor fuel tax No increase in federal motor fuel tax since 1993since 1993
Inflation has decreased motor fuel tax Inflation has decreased motor fuel tax purchasing power >28%purchasing power >28%
Tax exemptions reduce user-based Tax exemptions reduce user-based revenuesrevenues
Highway user fees diverted to non-Highway user fees diverted to non-highway useshighway uses
Project “earmarking” diverts $$ from Project “earmarking” diverts $$ from critical projectscritical projects
Trucking Trucking Perspective on Perspective on
TollingTolling
Tolling EfficiencyTolling Efficiency
Fiscal Fiscal YearYear Toll AuthorityToll Authority
Toll and Toll and Related Related RevenueRevenue
Estimated Estimated Toll Toll
Operations Operations CostCost
Cost to Cost to RevenuRevenue Ratioe Ratio
20042004New Jersey New Jersey Turnpike Turnpike AuthorityAuthority
$828,919,60$828,919,6099
$251,389,10$251,389,1011
30.3%30.3%
20052005New York State New York State Thruway Thruway AuthorityAuthority
$511,200,00$511,200,0000
$123,822,15$123,822,1511
24.2%24.2%
20042004Ohio Turnpike Ohio Turnpike CommissionCommission $211,771,00$211,771,00
00$46,449,000$46,449,000 21.9%21.9%
Safety Impacts of Toll Safety Impacts of Toll DiversionDiversion
Between 1995 and 1999, Ohio Between 1995 and 1999, Ohio Turnpike Authority increased tolls on Turnpike Authority increased tolls on Ohio Turnpike by 82%Ohio Turnpike by 82%
As a result, commercial traffic As a result, commercial traffic diverted to alternate, non-tolled diverted to alternate, non-tolled roadsroads
High profile crashes (fatalities) on High profile crashes (fatalities) on alternate routes led to rollback in alternate routes led to rollback in tollstolls
Trucking Trucking Perspective on Perspective on PrivatizationPrivatization
Privatization IssuesPrivatization Issues
Non-Compete Clauses Hurt Non-Compete Clauses Hurt Adjoining SystemsAdjoining Systems
Pricing is UncertainPricing is Uncertain Interstate System is Critical for Interstate System is Critical for
U.S. EconomyU.S. Economy Privatization Success Stories?Privatization Success Stories?
Macquarie Financial Troubles..Macquarie Financial Troubles..
Trucking Trucking Perspective on Perspective on
Mileage-Based TaxMileage-Based Tax
Mileage TaxMileage Tax
Implementation will be costlyImplementation will be costly Enforcement appears difficultEnforcement appears difficult Technology not robust enough Technology not robust enough
for lane/facility differentiationfor lane/facility differentiation Overall, feasibility is Overall, feasibility is
questionablequestionable
SummarySummary HTF not meeting needsHTF not meeting needs Fuel tax most efficientFuel tax most efficient Tolls inefficient & create safety Tolls inefficient & create safety
impactsimpacts Privatization negatively impacts Privatization negatively impacts
seamless transportation networkseamless transportation network Mileage-based tax is not possible in Mileage-based tax is not possible in
the short-run the short-run Balkanization of system harms U.S. Balkanization of system harms U.S.
global competitivenessglobal competitiveness
The Bottom Line: The Bottom Line: Motor Fuel Tax is an Motor Fuel Tax is an
Efficient Way to Collect Efficient Way to Collect Revenue…Revenue…
Ultimate user fee; social equity Ultimate user fee; social equity compasscompass
Cost to collect federal motor fuel tax Cost to collect federal motor fuel tax approximately 0.2 percent of revenue approximately 0.2 percent of revenue collectedcollected
At the state level, cost of collecting At the state level, cost of collecting motor fuel tax 1-2 percentmotor fuel tax 1-2 percent
A tax increase would be inexpensive A tax increase would be inexpensive and quickly implementableand quickly implementable