The Reason Foundation’s newest policy paper, The Roll of Tolls in Financing 21st Century Highways, by Peter Samuel, is a primer on highway finance. Two recent events suggest that many transportation policy makers don’t really understand what long-term road concessions are all about. Earlier this month, Texaslegislators passed an ill-conceived moratorium on any new concession deals. And on May 10, the respective chairs of the U.S. House Transportation and Infrastructure Committee and the Highways and Transit Subcommittee sent an amazing letter to all 50 state governors and other officials warning them not to enter into such agreements that “can undermine the national highway system.”
These developments make this policy paper very well-timed as it lays out the increasing limitations of the 20th century fuel tax/trust fund/grants model. It also explains why it makes sense to finance, rather than pay cash for, long-lived infrastructure such as major highway, bridge, and tunnel projects.