The non-partisan Congressional Budget Office (CBO) released January 26 a new analysis of the Highway Trust Fund’s revenue outlook that shows the fund will require approximately $5 billion in additional revenue this summer to preserve federal highway and transit investment for the remainder of FY 2015. According to CBO, if no action were taken, the trust fund’s Highway Account and Mass Transit Account would end FY 2015 with a narrow balance, but the U.S. Department of Transportation says a $4 billion surplus in the Highway Account and a $1 billion surplus in the Transit Account are necessary to meet cash flow requirements. As a reminder, cash flow problems were the reason the department warned states last July it would begin slowing down reimbursements for already underway federal-aid work. In addition to the latest looming trust fund revenue shortfall, legislation will also be needed authorizing the expenditure of trust fund resources beyond May 31.
The new CBO report shows the trust fund will need an average of just below $15 billion per year over the next six years to maintain current levels of highway and transit investment (plus inflation). This annual shortfall is a modest improvement from the $16 billion annual gap CBO forecast last August.