Pennsylvania Takes Bold Action for Infrastructure But Will Be Hit Hard if Federal Legislation Sits Idle
The more-than-century-old Pennsylvania Chamber has close to 10,000 members and is a business advocate in a state Forbes identified in 2018 as having the sixth biggest economy in the United States, with $793 billion in Gross State Product.
But Pennsylvania is not without its weighty challenges, and infrastructure improvements and renewed investment remain central issues. At 40,000 miles, the Commonwealth has nearly as many state-maintained miles as New England, New York and New Jersey combined, and the fifth-largest roadway system and third-largest number of bridges in the United States, according to the Pennsylvania Department of Transportation (PennDOT).
Gene Barr knows this Northeast and Mid-Atlantic fulcrum of commerce and people well. As President and CEO of the Harrisburg-based Pennsylvania Chamber (also known as the PA Chamber of Business and Industry) since 2011, an executive with a formidable career in government relations and a native with family roots in the energy sector, he recognizes that sustainable transportation revenue is fundamental to the region’s future.
In 2013, comprehensive transportation legislation called Act 89 — to raise billions to address a backlog in needs for the commonwealth’s roads, bridges and public transportation — was signed into law. It authorized an uncapped gas tax and phased-in increases to improve an increasingly aged and strained transportation system by increasing revenue for Pennsylvania’s Motor License Fund. The transportation department’s strategically communicated benefits were many: generating 62,000 jobs; providing an additional $220 million a year in liquid fuels allocations statewide for locally owned roads and bridges; providing funding for 10 critical transit services and making a historic investment in statewide public transportation; growing multi-modal investment grants by indexing them to inflation; and improving and/or rebuilding more than 10,000 roadway miles and thousands of bridges, the latter of which had become a principal concern for the state.
“We had bridges that were closed down. We had bridges where we couldn’t transport kids across in school buses in cold weather because it was unsafe. They had to get off, walk across and the bus would have to go over separately. We had trucks delivering milk that had to make 20-mile detours,” recalls Barr. “Those things resonated with the public and with legislators. … And the following election, not a single member of our House or Senate lost their seat over their vote on transportation. Not a single one.”
Pennsylvania is one of 31 states that has raised or reformed its gas tax this decade to address infrastructure, according to the Institute on Taxation and Economic Policy (ITEP). Doing so, while also winning the support of the business community in a purple state with conservative pockets, reveals that federal lawmakers’ opposition to raising the federal gas tax can be an intellectual red herring.
The PA Chamber has opposed a proposed additional tax, a severance one, on energy resources to beef up infrastructure funding; however, it supported the gas-tax increase. Barr says that chambers nationwide have an important role in building broad-based coalitions that propel the need for infrastructure legislation and reliable funding.
“Our gas tax is a user fee. The only way to get better infrastructure is to pay for it. There is no proverbial free lunch. … And we draw a distinction between what we call smart tax policy and unwise tax policy that endangers investment,” says Barr. “Efficient and safe mobility has to be achieved with a partnership of local, state and federal government. The frustration is that the federal government is kind of not able to get its act together.”
A nexus for travel and strong regional economies, Pennsylvania was also a battleground for who would become the 45th American President. The campaign cycle brimmed with concern about the declining state of the nation’s infrastructure.
Coincidentally following days of record heat, the Senate Environment and Public Works (EPW) Committee released this week a highway funding reauthorization bill, with components that speak to climate change, project streamlining and new grant programs. It’s a step in the right direction but does not eke out a sustainable revenue source for the Highway Trust Fund (HTF). The Senate Finance Committee will have to add provisions addressing the solvency of the trust fund.