The Highway Trust Fund: It’s a Millennial Problem

The Highway Trust Fund: It’s a Millennial Problem

January 01, 2015  | Elizabeth Bastian

Before embarking for a long summer vacation, Congress has disappointingly failed, once again, to pass an updated multi-year surface transportation bill. Instead, for the twelfth time, our nation’s legislature temporarily extended existing transportation funding until the end of October of this year.

In the short term, this means that the Highway Trust Fund, thankfully, will continue to provide financial assistance for state infrastructure and mass transit projects. But in the long run, the Trust Fund, which is supported by stagnant federal fuel tax revenues, will continue to spend billions more than it receives in fuel tax revenues. Congress, unwilling to either raise the fuel tax or cut spending, has spent the last eight years resorting to general fund bailouts. And with so much political capital expended on finding bailout money, there has been little attention made to improving the way that the federal dollars are spent.

To those outside the realms of transportation and Washington politics, a sustainable and reliable source of transportation funding can seem trivial. But fans of John Oliver and Rosabeth Moss Kanter know that America’s infrastructure is not receiving adequate investment. In every state, in every region, a lack of federal funds means dozens of missed opportunities for better traffic flow, faster transit, and safer streets for all. An insolvent Highway Trust Fund does nothing to solve this issue.

So whose problem is this? Who does this matter to most?

Let me make the case to my fellow “Millennials” that this issue is really one for our generation. Millennials currently make up the largest share of the American workforce, and that percentage is only going to continue to grow as more young adults enter/graduate from college and begin their careers. Though Millennials are portrayed by the media as an urban generation that sees car ownership as irrelevant, recent data indicates this is far from the truth. And, regardless of whether or not some of the 18 to 34 year-olds are conscientiously choosing to forego cars, the solvency of the Highway Trust Fund, along with the way it is used to shape our transportation network, still is a great matter of importance to this cohort.

What you need to know about the Highway Trust Fund

For the non-transportation wonks out there, here is a brief history of the Highway Trust Fund (HTF) courtesy of the Eno Center for Transportation’s Highway Trust Fund 101 (more info and news on the HTF can be found here):

“The Highway Revenue Act of 1956 introduced the HTF, which is the funding mechanism for the Federal surface transportation grant-in-aid program. The HTF was designed to accelerate the development of the Interstate Highway System. In the 1970s, the purview of the HTF expanded to include expenditures on mass transit. In 1982, a permanent Mass Transit Account within the HTF was created. The highway user taxes dedicated to the HTF are extended periodically by Congress- most recently by MAP-21. These taxes are currently scheduled to expire on September 30, 2016.”

Essentially, the Highway Trust Fund has been plagued with bailouts because Congress has refused to either 1) decrease expenditures paid out to states for roads, infrastructure, and mass transit, or 2) increase incoming revenues by increasing the gas tax. But it is also important to note that the Highway Trust Fund was designed as a temporary measure to fund the construction of the Interstates. With those highways long completed, the HTF continues to dole out funding to states and localities without a clear purpose. While the fund recipients admit that they are very dependent on those funding allocations, they are not required to have any accountability to national goals or outcomes. In other words, instead of utilizing these funds to work towards a visionary, modern national road network, states are being given funds to maintain what they have, with little regard for costs and benefits.

Why Millennials should care about the HTF, and federal transportation policy in general

Millennials – the generation defined by a loaded buzzword, supposedly destined to change the face of transportation in America. Since the recent recession, it seems that hardly a day goes by without a blog post or news article touting how Millennials (most commonly classified as those born between 1980 and 2000) are altering the stereotypical American lifestyle by moving to urban centers and embracing alternatives to car ownership.

Numerous studies have painted the evolution of millennial wants and needs over the past several years. In 2011, they were allegedly bringing about the demise of the suburban housing and automobile markets. Car companies and realtors bemoaned the flight to the city (or the return to the parental homestead), concerned that this new generation would reverse the trends of home and car ownership established by their parents. Trendy urban neighborhoods and rapid gentrification of large cities, mostly concentrated on the East and West coasts, were painted by the media as evidence of an entire generation giving up the proverbial American dream.

And in some ways, this is true. Vehicle miles traveled (VMT), both per capita and in total, have been on the decline for the past several years, and many Millennials continue to push for better mass transit. A recent report released by the American Public Transportation Association (APTA) found that communities that attract Millennials provide a multitude of transportation options, and that they often used multiple modes of transportation within a singular trip. In a 2014 survey conducted by the Rockefeller Foundation and Transportation for America, over half of Millennials surveyed (54 percent) indicated that they would consider moving to another city if it offered a wider, better range of options for getting around. Additionally, TransitCenter’s 2014 study entitled Who’s on Board: 2014 Mobility Attitudes Survey found respondents under 30 to be both the most enthusiastic about public transit and the most likely to use it.

But some assumptions about a transit-bike-ped generation are starting to be questioned. In April of this year, J.D. Power and Associates released data demonstrating both the increased dollars spent and share of Millennials (or “Generation Y” here) purchasing vehicles, which rose from 17 percent to 27 percent in the past five years. A 2015 study by the Urban Land Institute found that only 13 percent of people surveyed ages 19-36 lived in or near an urban downtown, and only 37 percent see themselves as “city people.” And though only 26 percent of those surveyed currently owned a home, 92 percent believe that they will eventually own a home.

These reports fall well in line with the research conducted by Brian Taylor of UCLA, who found that the eschewing of cars (and the suburban lifestyle) is due to both generational and economic effects. This generation is becoming adults in a tough economy, forcing them to make economic choices concerning living situations and jobs that their predecessors didn’t necessarily make. These choices often involve delaying large investments, such as the purchase of a house or a car.

So if Millennials aren’t wholly converging to coastal urban areas to live carless walkable lives, where are they going? Using data from the 2013 5-year American Community Survey (ACS) from the U.S. Census Bureau, Eno Center for Transportation was able to crunch our own data on Millennials aged 18 to 34, to see where this generation actually had a large impact in terms of population. We chose to use Metropolitan Statistical Areas, or MSA’s, in order to observe more regional live-work relationships.

Looking at basic population numbers, there is a pretty vast difference between the “stereotypical” millennial cities where young adults are supposedly living this exciting urban lifestyle (where there are large numbers of Millennials), and the cities where Millennials actually dominate the population as a percentage. The former top 20 includes most of the typically touted large urban centers attracting the young and the restless . However, when looking at places where Millennials have the highest share of the population, the top 20 completely consists of large college towns (plus Jacksonville, NC, which is home of the main U.S. Marine Corps base camp).

Now, clearly, college towns with universities hosting tens of thousands of 18 to 22 year olds are going to have large shares of Millennials. So, to correct for this, we also looked at the top 20 MSA’s by percent of population ages 25 to 34 only. While several of the MSA’s in the top 20 for all Millennials carried over into this category, there were also some new cities that appeared – cities that are beginning to be featured as examples of the urban/suburban mixed form desired by Millennials, such as Austin-Round Rock, TX and Salt Lake City, UT.

So to answer the question of “where are the Millennials?” it really depends on the chosen perspective. In terms of numbers alone, there are large concentrations on the East and West coasts of the continental United States; but in terms of shares of a total population, the percentage of Millennials in metropolitan areas are pretty evenly distributed throughout the country. What does this mean? Two things, really: 1) that the assumptions about the urban Millennials, specifically concerning their living and driving habits and tendency to settle in coastal areas, need to continue to be challenged; and 2) that transportation and infrastructure investments, or the lack thereof, should be a concern to Millennials all across the nation.

The Highway Trust Fund, and the surface transportation legislation that supports it, is a critical financial supporter of not just roads, but of mass transit projects and bicycle and pedestrian infrastructure. Without a strong federal role, it is unlikely states will be able to maintain, much less improve, our existing transportation infrastructure. And without improved investment, Millennials are doomed to a future of outdated transportation and infrastructure, as well as federal policies that lack the flexibility for multimodal and technological innovations.

The American road network is not getting any younger – and neither are we. While not all Millennials fit the oft-quoted stereotypes, it is clear that the face of transportation is changing because our generation wants options. But the Highway Trust Fund and its funding mechanisms were designed for the interstate system – the transportation dreams of our parents and grandparents. Though the jury is still out on whether Millennials will follow in the lifestyle footsteps of their parents, we cannot continue to assume current policies are sustainable and suitable for the contemporary transportation environment. As Congress continues to tiptoe around a stable funding source, Millennials have a chance to shape policy towards the kinds of investments we value in order to power our inherited economy, and halt the cycle of continuous insubstantial funding extensions.

We are the generation of technological innovation. We can summon a ride with a couple taps of a phone screen. We know that self-driving cars, or autonomous vehicles, could very well become a normal transportation commodity within our lifetime. By the very nature of time and federal spending practices, the present debt created by decades of failed transportation legislation will already weigh heavy on our shoulders. When it comes to making sure our transportation infrastructure and the policies that finance it are ready for the modern technological environment, it comes down to us. We have the power to both preserve the present and prepare for a better future.

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