Senate Transportation Bill Would Divert $669 Million From Trust Fund Over 10 Years

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Diversion of Storage Tank Cleanup Funds  

Key Development: The Senate-passed transportation bill would divert $669 million from the Leaking Underground Storage Tank Trust Fund over the next 10 years to help fund transportation projects.

What's Next: House and Senate conferees will consider the provision as part of their ongoing negotiations on the surface transportation reauthorization bill.

By Anthony Adragna  

Proposed language in the Senate-passed transportation bill would result in $669 million being diverted from the Leaking Underground Storage Tank (LUST) Trust Fund over the next 10 years to help fund transportation projects, according to a report from the Joint Committee on Taxation.

The May 25 report examined the financial impacts from the House and Senate versions of the transportation bill, which a conference committee is trying to combine into a final version.

The Senate bill would take one-third of the future revenue from the storage tank fund, which is financed by a 0.1-cent tax on each gallon of gasoline sold in the United States, and direct that money to the Highway Trust Fund. The joint committee estimated that would divert $669 million from the LUST fund over a decade.

That is in addition to a proposed $3 billion transfer from the LUST fund, which would occur immediately upon the bill's adoption and nearly deplete the current fund. The House version of the bill does not contain any language relating to the LUST fund.

According to the report, the Senate bill would divert $16 million from the LUST fund in 2012 and $337 million in total between 2012 and 2017.

Created in 1986 and currently estimated to contain $3.6 billion, the LUST fund allows the Environmental Protection Agency to oversee and enforce storage tank cleanups, conduct inspection of sites, and pay for site cleanups when the owner is unavailable or unknown.

Industry Groups Opposed.

Sherri Stone, vice president of the Petroleum Marketers Association of America, told BNA May 29 the group is vehemently opposed to what it considers “robbing the trust fund.”

Stone said the group had reached out to members of Congress and found that many did not fully understand the provisions. The group has several supporters of its efforts “lined up” to block the diversion, but Stone said she had not heard of any official discussions between conferees about the LUST fund provisions.

PMAA has lobbied Congress to release additional funds from the trust fund for years. If releasing additional funds “is not going to happen, you must be overtaxing us or call it what it is--an additional highway tax,” Stone said. “But don't play games with these funds.”

The Society of Independent Gasoline Marketers of America, another outspoken critic of the proposed transfer in the Senate bill, was unavailable for comment.

Taxpayer Group Supports Transfer.

Taxpayers for Common Sense, a nonprofit group whose goal is to reduce government waste, said the proposal remains one of the most financially sound in the transportation package.

“As long as we remain at reasonable funding levels to support federal cleanup programs, we're not opposed to the transfer,” Erich Zimmermann, transportation policy adviser with the group, told BNA.

By Anthony Adragna  


The report from the Joint Committee on Taxation is available at http://op.bna.com/env.nsf/r?Open=aada-8urqej.