Buttigieg Wavers on Age-Old Transportation Funding Conundrum

Pete Buttigieg, President Joe Biden’s nominee to lead the Transportation Department, signaled a willingness to confront the politically risky task of raising the gas tax to pay for infrastructure Thursday, only to walk the comments back hours later.

The Biden team has proposed investing in infrastructure to restart the economy after the pandemic, but hasn’t identified a way to pay for it. The gas tax — the primary federal funding mechanism for highways and transit — hasn’t been increased in 28 years.

“All options need to be on the table,” Buttigieg said at his confirmation hearing Thursday before the Senate Commerce, Science, and Transportation Committee. “Up until now that’s been addressed with general funding transfers, I don’t know whether Congress would want to continue doing that.”

After the hearing, a spokesperson for Buttigieg backtracked on his comments, saying that while a variety of options must be on the table, increasing the gas tax shouldn’t be one of them.

The Biden administration will have to confront the same reality that the Trump administration faced on infrastructure: absent new funding ideas, lawmakers are unlikely to agree on a way to pay for a major package.

Photo by Stefani Reynolds/Pool/AFP via Getty Images

Pete Buttigieg, nominee for transportation secretary, testifies at his confirmation hearing before the Senate Commerce, Science, and Transportation Committee on Jan. 21, 2021.

Buttigieg’s reversal could have to do with his boss’ stance on the issue. Biden dismissed the idea last year.

“I’ve tried this before. We’re not going to be able to raise the gas tax,” Biden, who voted to increase the gas tax in 1993, said at a forum on infrastructure in February.

Buttigieg’s path to confirmation appeared smooth as lawmakers from both sides of the aisle spoke positively about his nomination. The former South Bend, Ind., mayor was introduced by his home state senator, Republican Todd Young.

Although the timing of a confirmation vote is unclear, a Senate Commerce aide said Buttigieg has one week to answer questions for the record, then his nomination can go before the committee for a vote. The panel plans to hold an executive session on Jan. 27.

Multiple Solutions

Buttigieg suggested at the hearing that several approaches may be needed to fund transportation.

“In the near term, we need a solution that can provide some predictability, and sustainability in the long term,” Buttigieg said.

He said there are several different models in the short to medium term that could be revisited, including adjusting the gas tax, connecting it to inflation, or taxing people based on how much they drive.

Buttigieg acknowledged a tax based on miles traveled could raise privacy and logistics concerns, while more electric vehicles on the road will prompt questions about “whether the gas tax can be effective at all.”

When Buttigieg ran for the Democratic nomination for president last year, he proposed a user-based fee, such as a charge based on miles driven. Biden didn’t commit to a concrete proposal in his campaign platform.

Sept. 30 Looms

If confirmed by the Senate, Buttigieg will start in the role as pressure rises for Congress and the new administration to reach an agreement on how to pay for big infrastructure spending.

Congress will hit a deadline in September to reauthorize federal funds for highways, rail, and transit after agreeing to a year-long extension. Several committees in both chambers share jurisdiction and will weigh in on issues beyond financing.

Sen. Ted Cruz (R-Texas), for example, criticized the current funding formula, which requires his state to pay more into the Highway Trust Fund than it gets back. Buttigieg said he would look into it.

To contact the reporter on this story: Lillianna Byington in Washington at lbyington@bna.com

To contact the editors responsible for this story: Sarah Babbage at sbabbage@bgov.com; Loren Duggan at lduggan@bgov.com