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Sixth Month of Declining Vehicle Miles Traveled Signals Need to Find New Revenue Sources for Highway and Transit Programs

WASHINGTON – At a time of record-high gas prices and a corresponding surge in transit ridership, Americans are driving less for the sixth month in a row, highlighting ...

June 19, 2008

WASHINGTON – At a time of record-high gas prices and a corresponding surge in transit ridership, Americans are driving less for the sixth month in a row, highlighting the need to find a more sustainable and effective way to fund highway construction and maintenance, said U.S. Transportation Secretary Mary E. Peters.

The Secretary said that Americans drove 1.4 billion fewer highway miles in April 2008 than at the same time a year earlier and 400 million miles less than in March of this year.  She added that vehicle miles traveled (VMT) on all public roads for April 2008 fell 1.8 percent as compared with April 2007 travel. This marks a decline of nearly 20 billion miles traveled this year, and nearly 30 billion miles traveled since November. 

 "We’re burning less fuel as energy costs change driving patterns, steer people toward more fuel efficient vehicles and encourage more to use transit.  Which is exactly why we need a more effective funding source than the gas tax," Secretary Peters said.

The Secretary said as Americans drive less, the federal Highway Trust Fund receives less revenue from gasoline and diesel sales – 18.4 cents per gallon and 24.4 cents per gallon, respectively. 

The Secretary noted that data show midsize SUV sales were down last month 38 percent over May of last year; car sales, which had accounted for less than half of the industry volume in 2007, rose to 57 percent in May.  She said past trends have shown Americans will continue to drive despite high gas prices, but will drive more fuel efficient vehicles consuming less fuel.  "History shows that we’re going to continue to see congested roads while gas tax revenues decline even further," she said. 

"As positive as any move toward greater fuel efficiency is, we need to make sure we have the kind of sustainable funding measures in place to support needed highway and transit improvements well into the future," said Acting Federal Highway Administrator Jim Ray.

To review the FHWA’s "Traffic Volume Trends" reports, including that of April 2008, visit http://www.fhwa.dot.gov/ohim/tvtw/tvtpage.htm.  


ACP Editor’s Note:
This means that in April alone the Federal Highway Trust Fund had a shortfall of over $17 million; for the year, assuming that Mary Peters is correct and travel is down 20 billion miles for the year, the Trust Fund is down $245 million for the year. Using the first 4 months of 2008 as a base, extrapolating the loss, it will be $735 million, but probably more because the loss of miles driven will be far greater in the months June through August. (Assumptions: overall average vehicle mileage @ 15 mpg) Chances are good that the Highway Trust Fund shortfall could easily hit $1 billion for 2008. Needless to say, the impact at the local level is as great since state and local governments are also experiencing similar reductions in travel miles.

 

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