Federal Highway Trust Fund nearly depleted due to driving cutback
High gasoline prices have spurred Americans to sharply curtail their driving in recent months and the resulting sustained dip in fuel sales has helped bankrupt a federal fund for major transportation projects across the country. The Highway Trust Fund, which is paid for almost entirely through money generated by the federal gasoline and diesel taxes, will be $8 billion in the (pot)hole by the end of September; the huge deficit will delay highway payments to states, could cause a big dip in construction jobs, and may impact future highway projects. Just this summer officials were projecting the fund wouldn’t be depleted until at least October and that the debt would only exceed $5 billion sometime in 2009, but they seem to have underestimated the impact of high gas prices. Earlier this year, President Bush had adamantly opposed a spending bill that would provide $8 billion to prop up the highway fund, preferring instead to shift money from a federal mass-transit fund to make up the shortfall. However, faced with the enormous deficit much sooner than thought, Bush reversed course and has agreed to support the legislation.