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Transportation Funding & Financing

Freight-related Charges

A significant component of surface transportation in the U.S. that currently does not have a Federal-level funding source or program is goods movement. Goods movement today is a serious consideration for surface transportation, as port and intermodal terminal activities are significant sources of air pollutants, and the movement of freight by truck is a significant source of wear-and-tear on highways. A wide range of proposed goods movement-related revenue sources exist through various freight-related taxes and fees.

Container Tax

A national container fee could be established on some or all import and export containers (i.e. twenty-foot equivalent units or TEUs) moving through a U.S. port. A $10 fee on every TEU moving through a U.S. port would raise about $600 million in 2010. If the charge is only assessed on imports, it can be expected to raise approximately one-third less revenue. These proceeds could be dedicated to an intermodal investment fund. The Ports of Los Angeles and Long Beach currently charge container fees to fund their Clean Trucks Program to replace old, polluting trucks in their drayage fleets and to fund separate roadway, rail, and bridge projects.

Weight and Distance Taxes (Ton-freight or Ton-mile Taxes)

Freight-related taxes could be imposed based on either the weight of freight moved (a ton-freight tax) or as a function of both weight and distance (a ton-mile tax). These taxes would take into account the weight and load of a vehicle and essentially impose a premium on heavier vehicles to recover the added wear-and-tear they cause to the system. Variations of these taxes have been imposed by a few states in the past, but there has not been an equivalent tax imposed at the Federal level. Oregon has been charging heavy trucks a weight-mile tax since 1947 and currently does so in lieu of fuel taxes for this vehicle class. Kentucky, New Mexico, and New York also use variations of the weight-mile tax in combination with fuel taxes for their highway use taxation.

It is estimated that a 10-cents-per-ton assessment on freight moved by trucks would raise $1.1 billion in 2010; a similar tax on freight moved by all modes would raise $1.6 billion. A 0.1-cent-per-ton-mile assessment on freight moved by trucks would raise $1.3 billion in 2010; a similar tax on freight moved by all modes would raise $4.3 billion.

Freight Waybill Tax

A freight waybill tax (or bill of lading tax) essentially would be a sales tax on freight shipping costs for goods movement within the U.S. It is estimated that 1 percent tax on all truck freight waybills would raise about $6.5 billion in 2010, and a similar tax on waybills for all modes would raise $7.7 billion.

Customs Revenue for Transportation Purposes

Customs duties are imposed at varying rates on various imported goods passing through U.S. international gateways and currently go to the General Fund of the U.S. Treasury. A portion of the revenues from existing customs duties potentially could be dedicated to transportation infrastructure tied to the movement of those goods - effectively a transfer from the General Fund. Alternatively, a transportation use surcharge could be added to the existing custom duty and fee schedule and dedicated to freight transportation infrastructure.

Total customs duty receipts are expected to grow by nearly 7 percent per year for the next 10 years, which could allow for dedicating a portion of these funds to transportation. The imposition of a 1 percent transportation surcharge on customs duties would provide approximately $0.3 billion in 2010.

A number of interest groups, as well as the National Surface Transportation Policy and Revenue Commission, have suggested that given the role transportation infrastructure plays in facilitating the import of goods, a portion of current customs duties should be allocated to support transportation investment.