GAS TAX MONEY PILES UP IN D.C.; `IT'S KIND OF A SLUSH FUND FOR THE FEDS.

Byline: Paul Hefner Daily News Staff Writer

Next time you crawl to work in what's supposed to be the fast lane, here's one more reason to be agitated: While you're sitting in traffic, you're also helping balance the federal budget.

Here's how:

Motorists pay 18.3 cents a gallon in federal gas taxes, which by law are funneled into the Highway Trust Fund. But rather than spending the entire amount to repair and improve the nation's increasingly snarled and deteriorating roads, Congress instead sets aside a chunk of it - now $24 billion, roughly $4 billion being California's share - as a surplus.

The bookkeeping move is attractive to lawmakers because it allows them to spend more on other programs without increasing the budget deficit.

``It's kind of a slush fund for the feds,'' said David Fleming, chairman of the California Transportation Commission. ``Whenever they need some money to balance the budget, they always look to the trust fund.''

The unused transit money, which has grown over the years, nearly equals a year's worth of highway and transit funding. As drivers get increasingly fed up with congestion and car-damaging roads, the surplus is coming under attack.

With Congress in the midst of debating competing transportation funding packages, U.S. Rep. Bud Shuster, R-Pa., and several representatives from the congestion-leading state of California are pushing to cap additions to the surplus and spend some of it on the road improvements for which it was meant.

But spending the transit money on transit proposals faces stiff opposition from some leaders in Congress - Republican and Democrat - as well as from at least one spending watchdog group that views Shuster's proposal as a cash cow for road builders.

``It's basically a budget-busting bill. It reads like a wish list of pork-barrel highway spending,'' said Christian Sinderman of Taxpayers for Common Sense. ``Shuster gives a little bit to everyone. He's like Santa Claus. You can't argue with Santa Claus.''

Urban rush-hour nightmare

There's no argument that the nation's highway system needs an overhaul and that federal spending hasn't kept pace with the problem. Americans are driving more - and they're doing it on increasingly crowded roadways.

A report by the House Committee on Transportation and Infrastructure, which Shuster chairs, estimated that 69 percent of all peak-hour urban travel takes place in congested traffic.

In the San Fernando Valley, the trouble signs are as close as the nearest freeway. One study found that the average rush hour lasts for three hours in the morning and nearly five hours in the afternoon. Transportation officials say the average speed on the Ventura Freeway between Van Nuys Boulevard and Woodman Avenue is 21 mph in the morning, and drops as low as 16 mph in the evening.

``One does not need to be an engineer to realize that San Fernando Valley traffic is worse than it has ever been,'' Assemblyman Robert Hertzberg, D-Sherman Oaks, wrote in a briefing prepared for a Valley transportation summit earlier this month.

California roads behind times

With California caught for years in a recession and forced to set aside millions to make overpasses and bridges earthquake-safe, there was too little money left to keep the state's roads and highways in good repair - let alone expand them to meet growing demand, Fleming said.

As a result, the state now has 15,000 miles of highways and roads in need of maintenance - enough to stretch across the entire country five times.

``Imagine sitting in traffic on I-5 and knowing, oh, by the way, there's $24 billion in the trust fund,'' said Jeff Nelligan, chief spokesman for Shuster's committee.

``The fact is, Americans are increasingly dissatisfied with the transportation system, and the money is there to pay for the improvements. It's astonishing to think we have that much money locked away that we're not spending.''

Budget game

The surplus is an especially useful form of budget chicanery because it can be recounted against new spending with each budget cycle, said Andrew Poat, chief deputy director of the California Department of Transportation.

``There's no question it's a game of hide-and-seek,'' Poat said.

And it's all but certain that the surplus will grow rather than shrink in the coming years. Current estimates call for the fund to bring in $167 billion over the next five years, or $42 billion more than the balanced-budget agreement calls for spending.

Adding the current balance and interest, the fund's surplus may grow to $81 billion by fiscal year 2002.

Instead, Shuster's transportation funding bill calls for spending $81 billion over three years - $6 billion more than the current budget agreement allows. A rival measure pending in the Senate abides by the budget targets.

Nelligan said that even under their proposal, the trust fund surplus would grow to $59 billion.

``Our bill doesn't bust the budget,'' he said.

But others see it differently. House Speaker Newt Gingrich forced Shuster to delay consideration of his bill until next week because of concerns that it would violate the current budget accord.

Critics maintain the problem isn't that there has been too little money - the government's just been buying the wrong things. Among them: building new highways rather than taking care of existing ones.

``Politicians don't want to cut a ribbon over a pothole; they want to cut a ribbon over a new highway,'' Sinderman said. ``It makes for better photo ops and better publicity.''

Transit targets

Sinderman claimed Shuster's bill itself is loaded with dubious projects - authorizing, among other things, a transportation museum for Ohio, a rail museum for West Virginia and a museum to be built in Hibbing, Minn., devoted to the history of inner-city bus transit.

Disdain for the surplus has led Shuster and others to call for moving the trust fund off the books of the federal government's general budget ledger.

The House of Representatives actually approved a measure to move the fund off budget last year, but the bill was never considered in the Senate.

Several California representatives support the idea, including Jay Kim, R-Ontario, and Howard ``Buck'' McKeon, R-Santa Clarita.

But others are opposed, including Rep. Howard Berman, D-Mission Hills. With more than 150 trust funds on the books, it makes more sense to consider federal spending as a whole rather than piece by piece, he said.

That way, Congress is better able to set overall priorities, Berman said.

``I think we should be taking care of our roads,'' he added. ``I also think we should be taking care of our schools, taking care of national defense and doing what we can to cure AIDS, diabetes and cancer, and developing new technologies.''

Berman also said the size of the surplus is deceptive, because the federal government typically doesn't pay its share of state and local road-building projects until the work is completed.

``Most, if not all of it, is already dedicated to something,'' he said.

It's unclear how the current debate over transportation funding will be resolved. McKeon said it's increasingly likely that Congress will approve a short-term bill that falls within the budget guidelines - delaying consideration of Shuster's long-term plan.

``I agree that we should take the trust fund off budget, but now is not the time to have that fight,'' McKeon said.

With the balanced-budget agreement only a few months old, it's far too soon to push for measures that raise limits on spending, he said.

For McKeon, that likely means setting aside plans for the transit projects he's been pushing for in his own district.

``I could jump up and down, I could rant and rave, but it's not going to happen,'' he said. ``I'm optimistic about where we're going, it's just not going to happen this year.''

A delay in a long-term funding package might not be bad news for the region. The Metropolitan Transportation Authority actually hopes Congress opts for a short-term bill, giving the agency more time to put its financial house in order before returning to Washington with new funding requests, said Rae James, the MTA's executive officer.

And in the meantime, the outlook in California is that its own gas tax revenues will continue to rise with the state's improving economy, making more money available for local projects, Fleming said.

Still, he said, it's time for Congress to stop playing budget games with the gas tax collected from motorists.

``The problem is, they're spending trust funds to get elected,'' Fleming said. ``If you were a lawyer and you did that, you'd be disbarred.''