USDOT Numbers Show Continued Decline in Highway Trust Fund Balance

AASHTO Journal, 20 June 2014

The U.S. Department of Transportation this week updated its online Highway Trust Fund Ticker, showing the HTF is continuing its trend toward insolvency by late August and a drop below a $4 billion balance just before July 25. The monthly numbers continue to show an HTF balance falling into the negative well before the end of the federal fiscal year and the expiration of current surface transportation bill MAP-21. These numbers follow last month’s projections, though state transportation departments are now one month closer to making difficult decisions unless Congress can come up with a quick fix to ensure HTF solvency.

USDOT prefers to keep a minimum of $4 billion in the highway account in order to properly manage day-to-day financial transactions. At some point between when the account falls below $4 billion but before the account runs out of money, USDOT will likely institute cash management strategies designed to keep the account solvent. Last month, USDOT Secretary Anthony Foxx sent a letter to state transportation department leaders, warning them of this possibility (see related AASHTO Journal story here). These strategies may include reimbursing states weekly or every other week instead of daily or paying states for only a portion of the reimbursement requests they submit.

According to USDOT, the highway account of the HTF began FY 2014 (on Oct. 1, 2013) with a balance of $1.6 billion cash. Soon after the start of the fiscal year, the account received a $9.7 billion transfer from the General Fund. The cash balance has dropped by about $3.8 billion since then, leaving the Highway Account of the HTF at $8.1 billion as of May 30 (a number that stood at $8.7 billion last month).

USDOT reported that the mass transit account of the HTF currently holds $2.8 billion (down from $3.3 billion last month). That account began the fiscal year with a balance of $2.5 billion in cash, and then received an additional $2 billion from the General Fund. USDOT projects that account will hold close to $1 billion by the end of the fiscal year.

Various news outlets are reporting that both House and Senate leaders are looking for options to temporarily fix the HTF and keep it solvent through at least the end of the fiscal year. No official plan has been introduced, however.

USDOT’s HTF ticker is available online here.

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