State highway officials expect to see federal funding drop between $70 million and $90 million per year – about 11 percent from current levels – unless Congress and the Bush administration act quickly to reverse the shortfall.

County and city officials say they also could lose millions of dollars in federal funding. That money will be hard to replace as demands for other services compete for shrinking local tax dollars.

“It’s terrible, terrible news for Tacoma, and terrible news for any city,” said Tacoma Mayor Bill Baarsma. “Our resources are extremely limited, and we are squeezing every dollar.”

“It could definitely impact us,” added Toby Rickman, Pierce County’s deputy public works director. “I wouldn’t say we are panicked, but we have some concerns.”

The bulk of funding for the federal Highway Trust Fund comes from the 18.4 cents-per-gallon federal gasoline tax. But revenues from the tax have flattened out, likely because people are driving less due to the price of gas and because cars have become more fuel efficient in the 14 years since the federal gas tax was last increased.

White House budget officials said the Highway Trust Fund will have a roughly $3 billion surplus in the current fiscal year. But by the end of fiscal 2009 it will be running a $3.9 billion deficit.

“There are challenges,” said Christin Baker, a spokeswoman for the federal Office of Management and Budget, which writes the president’s annual budget proposal. “We can’t spend what we don’t have.”

When Congress proposed raising the federal gasoline tax by 4 cents per gallon several years ago, President Bush threatened a veto and urged lawmakers to curb spending.

In its latest budget proposal, the administration suggested as a temporary solution that money from the federal mass transit trust fund account, which is running a surplus, be transferred to the highway account to cover the anticipated shortage.

“We need the administration to do more than just move money around,” said Sen. Patty Murray, D-Wash., who as chairwoman of the Senate transportation appropriations subcommittee tracks federal highway and transit funding closely. Murray said the administration also wants to cut $1.8 billion from the highway spending plan Congress authorized.

“I’ve been raising a red flag about this for over a year,” Murray said, adding that increasing the federal gasoline tax remains an option “but relying on it alone might not be enough.”

WARNING AGAINST TAX INCREASE

The current five-year highway bill expires next year, and Congress will have to come up with a new plan.

“The last highway bill took several years to do because no one wanted to deal with these issues,” Murray said.

Administration officials insist Congress must rein in highway spending. They caution that an increase in the federal gas tax could be counterproductive because people would drive even less or buy even more fuel-efficient cars if gasoline prices go higher.

“Congress needs to prioritize spending and get it under control,” said Baker. “We want to work with Congress to get the trust fund on a more sustainable path.”

But even as lawmakers and the administration duel over what to do on the federal level, Washington state’s gasoline tax has been raised twice in recent years – a nickel a gallon increase in 2003 and a 9.5 cents per gallon increase phased in over four years starting in 2005.

Even so, the state’s transportation system has pressing demands – and not just a new Alaskan Way viaduct in Seattle or a new floating bridge across Lake Washington. Every city and county has needs, and increased costs for such materials as steel and asphalt are only making the federal funding pinch tougher to handle. Washington voters rejected an $18 billion roads-and-transit proposal last November.

“It’s on the minds of all of us,” Kathleen Davis, director of highways and local programs for the Washington state Department of Transportation, said of the shrinking federal Highway Trust Fund. “We are keeping our fingers crossed.”

LOCALS WORRY ABOUT CUTS

In Pierce County, Rickman said his biggest concern involves the 140 bridges that need replacing or maintenance. The county is replacing one or two bridges a year, and concern has only grown since the collapse of an interstate bridge in Minneapolis last year.

“Ninety percent of our funds for replacing bridges come from the federal government,” he said.

In Tacoma, Mayor Baarsma said the city already has an infrastructure that is crumbling – including roads, streets, sidewalks, sewer lines and water lines – and it could take more than $1 billion to fix the problems. Among other things, he said, heavily used roads near the Port of Tacoma resemble those in the Third World. The city is also suffering a “plague” of potholes.

“Construction costs are as high as they have ever been,” said Mark Kushner, transportation director of the Benton-Franklin Council of Governments in Eastern Washington. “You can’t defer maintenance. It’s like not fixing the roof on your house, and then it rains.”

LOOKING AT ALTERNATIVE FUNDING

Washington state updates its 16-year highway construction plan annually and has already taken into account the threat of shrinking federal support. Federal funds make up about one-fifth of the funding for the state’s current highway construction program.

“There will be less money for projects,” said Rick Judd, federal aid planning manager for the state Transportation Department said. “Eleven percent is a noticeable decrease.”

Some jurisdictions have begun looking at alternate sources of highway and road funding, such as tolls or private partnerships. But local officials are not sure such alternatives would work.

“We have looked at tolls, and we are not sure they would generate enough money in a community our size,” said Kushner.

Murray, meanwhile, said the problem of crumbling roads, highways and bridges cannot be ignored and the solution needs to be more than just a patch. She said state and local governments need certainty about federal funding.

“These types of projects can’t just be turned off and on like a light switch,” she said. “You can’t stop building a bridge when it is half done. These are multiyear projects. If we don’t start rebuilding our infrastructure, it will have a huge economic toll.”

Les Blumenthal: 202-383-0008