LUST Trust Fund is Useful Piggy Bank for Congress to Tap for Highway Funding
Posted at 10:24 a.m. on July 22, 2014
When you’re in a pinch, it’s comforting to have an extra $1 billion or $3 billion sitting on the shelf. That’s essentially what the Leaking Underground Storage Tank Trust Fund is when Congress needs money to help refill the Highway Trust Fund.
In both the highway funding bill passed by the House last week and the measure that the Senate may debate this week, the Leaking Underground Storage Tank Trust Fund, or LUST Trust Fund, is one of the sources of money to be transferred to the Highway Trust Fund.
The House bill would take $1 billion from the LUST fund, while the Senate Finance Committee’s bill would take $3 billion.
The LUST fund was created in 1986 to pay for preventing and cleaning up leaks from underground oil storage tanks. The money in the fund comes from a 0.1 cent per gallon tax on gasoline.
The array of federal trust funds ranges from the massive – the Old Age and Survivors Insurance Trust Fund, which pays out Social Security benefits – to the relatively small and obscure: the Cheyenne River Sioux Tribe Terrestrial Wildlife Habitat Restoration Trust Fund.
The Senate Finance Committee’s explanation of its bill notes that LUST fund revenues “have consistently been greater than outlays and the fund has accumulated a balance of $3.745 billion as of the end of fiscal year 2011. The total revenue into the fund including interest is over $300 million per year while outlays are just over $100 million per year.”
Ed Lorenzen, a senior advisor at the Committee for a Responsible Federal Budget, said, “The argument for making a transfer from LUST to the HTF is that Congress made a mistake in diverting $0.01 of the gas tax to the LUST fund instead of the Highway Trust Fund because the LUST trust fund does not need all of the revenues….”
The term “trust fund” may evoke an image of something solid and dependable, but as the sorry state of the Highway Trust Fund itself illustrates, a federal trust fund is only as reliable as its revenue source.
When needs keep growing, but revenue doesn’t, then the fund isn’t sufficient, even if it has the word “trust” attached to it.