Transportation Trust Funds

GAO discussed the status of the Highway and the Airport and Airway Trust Funds, focusing on the use of the trust funds to mask the federal budget deficit. GAO found that: (1) revenues to both funds come from excise taxes; (2) the balance of the highway account was a little over $9 billion, which the Federal Highway Administration (FHwA) needed to pay outstanding commitments; (3) while the trust fund had $7.4 billion in uncommitted funds to support other projects, FHwA did not want to increase highway project expenditures because it would affect the overall federal deficit; (4) within certain limits, the Federal Aviation Administration (FAA) could use its trust fund money to cover operations and maintenance (O&M) expenses and finance the remainder from general U.S. Treasury funds; (5) the aviation trust fund balance of $13 billion exceeded its outstanding commitments by about $7 billion; (6) although the trust fund receipts always exceeded its spending, Congress limited FAA trust fund expenditures for O&M and funding requirements to modernize the aviation system over the next few years; and (7) the current federal budget structure masks trust fund and non-trust-fund fiscal relationships, resulting in a surplus that lowers the total federal deficit. GAO believes that Congress should: (1) consider eliminating the spending restrictions for FAA O&M costs; (2) consider a recent recommendation to use the fund to pay for more FAA operations; and (3) restructure the federal budget's structure to distinguish between operating expenses and capital investments.