A victory at the polls. Passage of June’s bond referendum is good news, for now.
By Gregory A. Dore
Paying it forward. What do high gas prices mean for the future of our roads and bridges?
By Kathryn Buxton
A turning point. The story behind the recent, successful legislative session.
By Doug Rooks
Wind, water and liquid natural gas. Energy alternatives at MBTA’s Washington County meeting.
By Kathryn Buxton
Putting the breaks on runaway fuel prices.
Going after big oil and off-market speculators to reduce unfair fuel pricing.
By Rep. Tom Allen
Driving down fuel costs for truckers.
Going after big oil and off-market speculators to reduce unfair fuel pricing.
By Sen. Susan Collins
A victory at the polls, and a lesson
This is my first column as president of the Maine Better Transportation Association, and I have to say I feel fortunate to take up the reins at a time when the organization is celebrating so many victories. We were able to accomplish a lot in the past year, thanks to the hard work of my predecessor Lauren Corey, the MBTA board, our members and the staff.
Most recently, the statewide bond transportation bond issue – Question 1 on the June 10 primary ballot – passed, even with a surprisingly light turnout at the polls. The $23 million transportation bond was part of a larger bond issue that included funding for natural resources bonds.
By recent standards, the $23 million wasn’t a very large chunk of funding. The majority of funding for the current biennium, a bond for another $113 million, was passed by voters in June 2007.
Out of sight, out of mind
Mainers were in an uproar this past winter and spring about the conditions of their roads and bridges. They were upset about potholes and worried about the safety of their families after the collapse of the I-35W bridge in Minneapolis. They wanted their roads and bridges fixed. That public concern helped make the case for increased transportation funding in the Maine Legislature this past spring. And it helped us win some very important legislative victories – including $160 million in new bridge funding and $50 million in new highway funding. (The legislature also approved additional funding to expand passenger rail systems beyond Portland.)
Yet by the time the June vote came around, most of those potholes had been filled, and a lot of the urgency was behind us. Voters may not have made the connection between last winter’s potholes and this spring’s bond vote. And when they went to the polls, they passed the bond with 58 percent of the vote, a low number for popular transportation bonds.
The lesson in this “out-of-sight-out-of-mind” voter phenomenon is that public awareness of the need for transportation investment is vital to our future success.
During this past election, MBTA did not mount a television voter awareness campaign, because the size of this year’s bond made it difficult to raise money during tight fiscal times. While MBTA and MaineDOT generated news stories and other “earned” media, there was no paid advertising campaign. So most people going to the polls in June were unaware there was a bond issue on the ballot.
Another issue is that the transportation bond was combined with clean air and natural resources bonds – both important investments – but issues that don’t tend to garner as many votes as transportation bonds historically have.
Currently Maine and the nation are in the midst of an economic slowdown. Voters are likely to be more fiscally conservative in times like these, and competition for public money continues to increase.
We have many challenges ahead. Federal Highway Trust Fund revenues are falling. So are revenues to Maine’s Highway Fund. MaineDOT estimates it will need an additional $250 million annually to address our failing roads and bridges over the next 10 years.
Keeping up the pressure
Our job is clear. We need to be a major force in the effort to introduce new funding initiatives in the legislature. We need to be ready to take the case for transportation investment directly to the voters. Our job is to make sure that the public is aware of the great need for and great benefit of transportation investment in Maine.
Great MBTA presidents before me – Lauren Corey, Scott Leach and Tim Folster – have done so much already. I look forward to working with all of you in the next year as we continue to keep up the discussion – and the pressure – to get this work done.
I have another major goal for the coming year, too. As the head of the Skowhegan Public Works Department, I know first hand how closely the mission of the MBTA serves Maine’s cities and towns. Transportation is a lifeline for our families, businesses and communities, and I plan to use my presidency as a pulpit for that message and to encourage more municipal involvement in these issues.
It was good to see so many of you at the MBTA Washington County meeting in June and the Golf Classic in July. Still ahead is the Aroostook Meeting on August 14 and the Fall Convention at St. Andrews, September 12-14. Be sure to mark your calendar and join us. (Please note: While going to Canada doesn’t require a passport – an original birth certificate and license will do – many people are getting passports now as the application time has been greatly reduced.)
Thanks, too, for electing me president.
I look forward to working with you all as we make this a fun and productive year!
Paying it forward
The recent surge in gasoline and diesel prices is certain to reverberate throughout the transportation sector in the months and years ahead
By Kathryn Buxton
The day gasoline crossed the $4-a-gallon threshold signalled a major shift for the transportation industry. The news media focused on the pain consumers were feeling at the pump, and consumers continued finding ways to cut their driving with carpools, bikes, vanpools and public transportation – in short, driving 1.8 billion miles less nationally than in April 2007. That was a total decline of 30 billion miles in the six months from November 2007 to April 2008 (a 1.7 percent decrease over 2007). Businesses scrambled to adjust to skyrocketing fuel costs. Government agencies, including the Maine Turnpike Authority and the MaineDOT saw the results of careful long-term planning walk out the door.
“Revenues are down and costs are going up – that’s what we’re dealing with,” said Peter Merfeld, Maine Turnpike Authority chief operating officer.
The Turnpike Authority had sounded a warning bell in the week leading up to Memorial Day, when University of Southern Maine economist Charles Colgan released his forecast for holiday travel based on turnpike vehicle counts. Colgan heads USM’s Center for Tourism Research and Outreach (CENTRO) and he predicted that after years of steady increases in the holiday weekend traffic, Maine would see a 3.5 percent decrease at the York Toll Plaza. The culprit was gas prices that were 22 percent higher than the year before.
Colgan’s prediction was pretty close: actual traffic at the turnpike’s gateway toll plaza was off by almost 3 percent. And while CENTRO’s forecasting focuses on tourism trends, Colgan says no crystal ball is needed to see how gas prices are going to affect Maine’s overall economy – and its transportation sector in particular.
“The basic conclusion is this: people are driving less,” Colgan stated simply. “They are using less gas and diesel and, therefore, fuel tax revenues are going to fall.”
Falling, but how far?
According to the Maine Revenue Service, Highway Fund receipts were down by an estimated $1.8 million through the end of May. On its own, that figure would not likely grab headlines. But according to Marc Cyr, principal analyst for the Office of Fiscal and Program Review and a member of the state of Maine’s Revenue Forecasting Committee, the real news is that the lion’s share of those declining revenues – $1.1 million – came in just one month – May, when gasoline and diesel began its precipitous climb in price. In fact, fuel tax receipts, which make up the majority of Highway Fund revenues, were ahead by $600,000 by the end of April, making the drop in fuel tax receipts even more notable.
“That [drop in revenue] certainly is going to be an issue for the Highway Fund if the trend continues,” said Cyr. He said the fall off will likely be discussed the next time the revenue forecasting committee meets in August, although the real forecasting work will be done at the group’s meeting in early 2009.
“The gorilla on the block is the price of oil and trying to predict where that will be next year,” said Cyr. That has not been so easy lately, he said. Last year, all indications were that prices would level off. The recent steep increases have caught everyone off guard.
USM’s Charles Colgan believes that gasoline is currently “overpriced,” and that it eventually could fall back to about $3.50 per gallon. That could signal a return to a semblance of normalcy. Yet Colgan notes that the writing is on the wall for the Highway Fund, while user fees will continue to give the Turnpike Authority a more predictable income stream.
“At $3.50 a gallon gas, we’ll drive more, but we’re going to be driving more fuel efficient cars,” said Colgan adding that, even with Maine’s fuel tax indexing, revenues will not be able to keep up to the demand for highway and bridge maintenance.
Pat Moody of AAA Northern New England said his organization is seeing its membership struggle with high gas prices. Out-of-gas calls to AAA’s road service have skyrocketed. People are also looking for more cost-efficient transportation. “We operate a motorcycle driving school, and before we used to average eight people per class,” said Moody. “For the past four months, we’ve had 24 people in every class.”
How higher gasoline and diesel prices are paying forward can be seen in increased costs at the job site where fuel isn’t the only commodity that’s on the rise. Asphalt has nearly doubled in price since 2006; the current market price for asphalt is hovering around $90 a ton. Steel prices are on the rise as well, driven up by increasing demand worldwide.
Doug Hermann of Wyman & Simpson, Inc., said he has seen prices skyrocket on the highway and bridge projects his company is working on this summer, including the Mayall Road Bridge on the Maine Turnpike. “H-pile is double from a year ago and sheet pile has doubled, too,” said Hermann. Concrete reinforcing steel has increased in price substantially, and, of course, that has had a big impact on job costs.
“We’ve got equipment that burns 100 to 200 gallons of fuel a day – excavators, loaders and pile driving equipment,” said Hermann. With all of the material cost increases, estimating jobs has become more difficult, particularly on rehab projects where the contractor can’t lock in materials at the bid price.
“You can’t buy the stuff ahead of time, and a lot of times you don’t know exactly what you’re getting into,” said Hermann.
For MaineDOT and the Maine Turnpike Authority, those cost increases are far and above anticipated increases allowed for in their long-term plans. For the turnpike, that has meant instituting some cost saving measures on the paving contracts currently underway. The authority typically repaves 7.5 miles every year, and this year is no different.
“This year we’re not milling out the entire width of the highway. We’re only milling the travel and the passing lanes,” said the turnpike’s Peter Merfeld. He added that the Turnpike Authority has been working with MaineDOT paving experts and is now specifiying a finer asphalt mix at a depth of 1 ½ inches that promises to help contain costs. Previously, the turnpike has specified a coarser mix at a depth of 2 inches. This summer the turnpike also has seven bridge projects in the works, and Merfeld said the agency was lucky to have bid the projects early enough to lock in lower steel prices. He said that the turnpike board and staff are already looking ahead to 2009 when the full impact of this inflationary cycle will be felt.
“We’ve never seen anything like this before. It’s unprecedented,” said Bruce Van Note, MaineDOT deputy commissioner for operations and budget. Like others, he said, MaineDOT is watching to see what continued effect the market will have on fuel tax revenues and will incorporate that into the planning for the coming biennium that is already underway.
The “good news” according to Van Note is that, with leadership from Governor Baldacci, the legislature has already begun the move to new funding sources during the past two sessions. He said the department has been able to get seven highway construction projects into the pipeline, projects that had been put on hold because of recent Highway Fund shortfalls. The bridge bill, passed this spring, is another bright light. It means that there will be $40 million more per year available over the next four years ($160 million total) to begin tackling the state’s enormous backlog of deficient bridges.
“But for those two things, the highway construction picture would be considerably more bleak,” said Van Note.
A turning point
While 2008 was a very good year for making transportation a legislative priority, the hope is, it was just a beginning
By Douglas Rooks
As the legislature swept toward adjournment in mid-April, transportation advocates scored three significant successes, seeing enactment of bills to commit $160 million to bridge projects, $50 million to highway reconstruction, and $31 million as a revenue stream for a loan that will enable Maine to extend passenger rail service north of Portland.
All three bills were voted on and sent to Governor Baldacci for his signature during the session’s final week. And while no one was predicting that the package met all of the state’s pressing needs, it represented the best week for transportation programs Maine has had in several years.
Yet the swiftness with which the bills moved disguised a lot of careful preparation going back to the beginning of the session in January 2007. That’s when discussions began that led to a robust transportation bond package, according to House Speaker Glenn Cummings. Transportation needs made up more than half of a record $295 million, two-year bond agreement, of which the final portion was approved on June 10.
“There was a whole different atmosphere around transportation funding in this legislature,” Cummings said. “People were a lot more aware of the needs, and they were willing to act in a way we haven’t seen before.”
Cummings said that, early on, legislative leaders in both parties were willing to place a priority on transportation infrastructure, even before the collapse of an interstate highway bridge in Minneapolis focused national attention on the subject.
Senator Dennis Damon (D-Hancock County), who’s serving his third term on the joint Transportation Committee, and his second term as co-chair, remembers getting a call from Senate President Beth Edmonds (D-Cumberland County) last summer, and not knowing just what to expect. “She wanted to thank me for my advocacy of transportation projects, and said she expected to make it a [Democratic] caucus priority in 2008,” he said. “That hasn’t always been the case in the past.”
Edmonds was cited by legislators of both parties as being influential in getting the rail bill moving after several years of hesitation over whether Maine could afford to extend passenger service beyond the Portland-to-Boston Downeaster run it’s been offering since December 2001.
Edmonds initiated a “rail caucus” meeting in her office that discussed ways to win broader support beyond the Transportation Committee. She said that Republican senators like Karl Turner and Peter Mills were enthusiastic members, and helped win over colleagues, which was important when it came time to determine funding. Lawmakers agreed to sequester half the current sales tax income from car rentals to a separate rails fund, which will provide just over $3 million in annual revenue to support a federal loan for rail improvements at least as far as Brunswick.
The public hearing for LD 2019 was held on March 23, and testimony in favor of the measure came from a broad-based group of transportation and environmental advocates including: TrainRiders Northeast; Maine Better Transportation Association; the League of Young Voters; Maine Eastern Railroad; and the Sierra Club. Several individuals also spoke in support, and both NNEPRA and MaineDOT testified neither for nor against, providing information to the committee.
Train service will likely continue to be a hot topic, even after the passage of 2019. Edmonds said while there is “some money” available to continue operating subsidies for the Downeaster, she acknowledged that the state could be looking for more next year if Senator Olympia Snowe is unable to convince Congress to fund another extension of Amtrak subsidies. “The important point is that we’ve agreed that train service is vital, and must be maintained,” she said. “We’ve already made that decision going forward.”
Representative Boyd Marley (D-Portland) said he saw enthusiasm for the rail bill that hadn’t been there in the past. “Other legislators saw what it’s done for downtown redevelopment in communities like Saco, and decided they wanted it for their town as well.” Brunswick is currently reviewing an ambitious downtown project that includes a new train station, and Freeport is preparing for a stop on Bow Street that’s literally a long stone’s throw from L.L. Bean.
Damon said he was pleased that lawmakers were able to muster support for other transportation modes, despite the dire need for highway and bridge funding. “I always say that this should be the transportation committee, and not just the bridge and highway committee,” he observed. “We need to be working on all modes – ports, rail, freight, airports, and trails and pedestrian facilities, as well.”
A different view is offered by Rep. William Browne (R-Vassalboro), the ranking minority member on the Transportation Committee, who said, “I’m a little concerned that the committee has drifted away from our mission to shore up roads and bridges.” The decline of fuel taxes as a revenue source, and diversion of revenue to other needs, has made it difficult to maintain and improve the existing road network, he said. “We need to get more dedicated revenue for improvements.” Browne favors putting more money into roads even in preference to such long-standing state programs as passenger ferries.
And while he supported the revenue bonds voted for the bridge improvements in LD 2313: “An Act to Keep Bridges Safe,” as well as the two highway fund bonds approved by voters in 2007 and 2008, he said further bonding is probably not the answer. “We’ve reached the point where we don’t want to get the borrowing ratio any higher.”
Representative Richard Cebra (R-Naples), another member of the Transportation Committee, painted a more optimistic picture of the session’s progress. The legislature, he said, “finally realized how big the needs were,” and “saw the light just at the end of the session.”
Up to that time, he said, many lawmakers “believed these problems would go away and solve themselves,” but finally concluded that they wouldn’t. The $160 million bridge bond, in particular, should buy some time, Cebra said. “It bought us four years to get our act together,” and he’s confident that transportation needs will be put on a better footing by then. “It’s a slow process, but we ought to able to do it,” he said.
Not that all this was a sure thing. Marley admits to some nervousness as the session neared its end and there were still no bills on the floor that dealt with transportation. “The governor told us that he would offer a plan when the budget and some other bills were finished up, and in the end, he did.”
The $160 million revenue bond for bridges will support projects over the next four years, hopefully helping the state to reverse a trend that saw more bridges being added to the “deficient” list every year than were being reconstructed.
Sen. Damon said that the perceived need grew during the session. “MaineDOT’s study showed that there were at least 280 bridges due for replacement. By the time the Governor’s task force got through, there were 380,” he said.
Funding for the bridge bill, LD 2313, which had also been discussed long in advance, came from $10 increases in annual registration fees, driver’s license and vehicle titles – all of which were previously below New England averages. New revenue – of any type – was hotly contested during the session, but the “bridge fees” passed muster.
Rep. Marley said that the Transportation Committee was “nearly united” in support of the fees, with 12 of the 13 committee members signing on. Rep. Rich Cebra (R-Naples), a newcomer, and veteran Sen. Christine Savage (R-Knox County) were particularly effective, he said.
Marley also credited business groups, including considerable time and effort given by the MBTA, the Maine State Chamber of Commerce and AGCMaine, with actively working throughout the session to help frame the issues and keep the discussion of transportation in the forefront.
Marley and Damon also credit landmark transportation legislation from the previous session – LD 1790 – for laying the groundwork for this session’s successes. “LD 1790, which passed last year, established the TransCap Fund – and that really set the stage for the highway and bridge bills that passed this year,” said Damon. He credits the MBTA and its members – who worked hard to help draft the bill and ensure its passage – with raising the legislature’s awareness of the dire state of Maine’s transportation infrastructure and keeping transportation front of mind this session.
Dana Connors, president of the Maine State Chamber of Commerce, said businesses were willing to support more revenue for transportation, because transportation “is such a basic function of government.” He said, “There just isn’t any question that a well-functioning transportation network is necessary to making the economy work.”
The highway reconstruction bill, LD 2324, by contrast, is funded through a reallocation of responsibilities for State Police budgets away from the Highway Fund and toward the General Fund. The original focus on highway patrols made State Police dependent on the Highway Fund – the proportion has gone as high as 82 percent in recent decades, but current responsibilities suggest a much smaller proportion is related to patrol functions. Yet the Highway Fund still bore 60 percent of the cost; the new bill sets the division at 49 percent for the High--way Fund. Assistant Senate Majority Leader John Martin is largely credited with brokering the agreement to use the General Fund for a majority of State Police expenses – a point recommended by several study committees in recent years.
Aiming for continuity
Damon said he believes the perception that roads are deteriorating statewide played a part in convincing lawmakers to finally act on the State Police issue. “Every legislator hears complaints about the pothole down the road from a constituent’s house, but this year they heard a lot more,” he said.
Looking ahead, Marley, who’s among numerous house members forced out by term limits this year, is “pleased by what we’ve been able to accomplish, but concerned that I can’t be there to see it all come to pass.”
Damon, who’s eligible to serve one more term, said he worries about state government’s ability to make decisions, like this year’s on transportation, and stick to them. “We had to have a big transportation bond package because we’d missed out on a couple of previous cycles,” he said. With the legislature term limited, and the governor, too, “it’s a lot harder to maintain continuity, to stay committed to the progress that we’ve been able to make.”
It may be, he added, that where transportation funding is concerned, advocates will always have their work cut out for them.
Wind, water and liquid natural gas
Looking for energy options at MBTA Eastport meeting
By Kathryn Buxton
As rising energy prices captured the headlines early this summer and gas pushed $4.19 per gallon at service stations on Route 1 in Eastport, MBTA members at the annual Washington County meeting gathered to discuss energy alternatives on June 12 at the Eastport Chowder House.
The downeast region is currently in the forefront of the alternative energy debate, with several major projects in various stages of development. Ninety MBTA members, family, Maine lawmakers and friends attended the meeting that featured a panel discussion about three promising alternative energy sources: wind power, tidal power and liquid natural gas.
Chris Gardner, director of the Eastport Port Authority, moderated the evening’s panel discussion. Eastport City Manager Bud Finch welcomed the group and presented Maria Fuentes, MBTA director, with The Island City, a book detailing the rich history of the city of Eastport. Four legislators were among the group: Senator Kevin Raye (R-Eastport); Representative Dusty Fisher (D-Brewer); Representative Ian Emery (R-Cutler); and Representative Howard McFadden (R-
On the energy alternatives panel were two groups working to bring liquid natural gas facilities to Washington County. Dean Girdis of Downeast LNG and Representative Ian Emery (R-Cutler) of Calais LNG talked about their firms’ progress in winning local and environmental approvals for their projects. Any major new construction can present challenges – and that has been the history of LNG projects in Maine to date; other LNG proposals originally intended for the waters in midcoast Maine met with significant local resistance that eventually derailed the projects. Girdis and Emery talked about how their groups are working with regulatory agencies and community leaders – and hopefully building the local goodwill needed to bring an LNG facility to the region.
Harnessing the elements
One of the most innovative proposals on the discusion table that evening was a project to develop a turbine that would generate power from the natural movement of the tides. John Ferland of Ocean Renewable Power Company (ORPC Maine) spoke of a recent successful test in Passamaquoddy Bay of a prototype tidal turbine and ORPC’s commitment to take the technology to the next phase: development of a smaller, commercial prototype that would work in river waters as well as tidal currents.
Tim Folster of Sargent Corp. spoke on behalf of First Wind, a company that has one wind farm currently operating at Mars Hill and a second one under construction at Stetson Mountain. Sargent Corp. is the earthwork contractor on both of those projects. He spoke of the enormous potential of wind and how the Mars Hill wind farm, with 28 turbines, was already generating 167 million kilowatts per hour – the equivalent of 13 million gallons of fuel a day. The new Stetson Mountain facility will have 38 turbines and generate even more power than Mars Hill. Folster said constructing these projects has given him an idea of what it must have been like to work on the new interstate 50 years ago. Combined, the two projects have included construction of 17 miles of new road. Folster said wind power should remain a key part of the state’s energy policy in years to come because of Maine’s available “open space and unique topography.”
Time was taken during the evening to honor two individuals who have meant a lot in the fight for better transportation in Maine. Don Raye, a former MBTA president, took a moment to speak on behalf of Al Prince who passed away the week before. The group had a moment of silence in memory of the former president of Maine Good Roads (the predecessor organization to the MBTA) and winner of the MBTA’s lifetime achievement award.
Greg Dore, current MBTA president, also presented Rep. Fisher with a framed photo of the capitol dome and thanked the six-term legislator for all he had helped achieve during his time in the Maine State House. Fisher is retiring after 12 years, 10 of them spent on the Transportation Committee where he was a strong supporter of developing and maintaining Maine’s transportation infrastructure. He served as house co-chair of the committee for two of those years.
Before the meeting adjourned, a drawing was held for the 50-50 raffle to raise money for the MBTA’s Infrastructure Development Fund. Alan Jones of Fundy Contractors was the lucky winner.
Putting the brakes on runaway fuel prices
By U.S. Representative Tom Allen, 1st Congressional District of Maine
Prices at the pump have risen so fast and so high that Maine families and businesses are furious and suspicious. They have every right to be. The skyrocketing cost of gasoline and heating oil is not a matter of uncontrollable market forces that we are powerless to affect. Big Oil and shady speculators are making obscene profits at the expense of hardworking Americans. We need to elect leaders who will stop the giveaways and impose strict penalties on profiteers by making them pay for the hardship and anxiety they have caused.
Since January 2001, crude oil has risen from between $23 and $25 per barrel to as high as $145 in recent weeks. Heating oil has gone from $1.44 to $4.71 per gallon. In Portland, unleaded gasoline has jumped from $1.54 to $4.13 per gallon and diesel from $1.65 to $4.86 per gallon.
The past seven years have been tough for everyone in Maine with a vehicle, furnace or a livelihood dependent on fuel. Indeed, the impact of runaway fuel prices is spreading to virtually all aspects of the economy. As consumers are forced to cut back on driving, federal gasoline excise tax revenues, that fund the federal highway trust that pays for our nation’s highway infrastructure, will fall. As households struggle to pay their fuel bills, families are spending less on other expenses, such as eating out and entertainment, as well as on basic necessities. Higher fuel costs have pushed prices for everything from plane fares to groceries through the roof. Fuel costs have become an economic catastrophe for Maine farmers, fishermen and other small business people. For some Maine independent truckers, unbridled fuel costs have put them out of business.
Local filling stations and oil dealers are not responsible. Like everyone else, the price crunch hits their bottom lines. Moreover, as prices have risen, gas stations and other fuel dealers have experienced a costly spike in product theft.
One sector of the economy, however, has reaped a bonanza the last seven years. In 2001, the “Big Five” oil companies – ExxonMobil, Shell, Chevron, ConocoPhillips and BP – posted combined profits of over $40 billion. In 2007, their profits topped $123 billion, with ExxonMobil’s $40.6 billion smashing the record for highest profit of any U.S. company in history.
I have written the Chairmen of the Federal Trade Commission (FTC), Commodity Futures Trading Commission and Federal Energy Regulatory Commission, and the Secretary of Energy and the Attorney General of the United States. I requested an immediate investigation of price fixing, manipulation, rampant speculation and other unscrupulous behavior in the petroleum markets. I called for prosecution and punishment to the full extent of the law of inappropriate or criminal behavior by oil companies, their subsidiaries, their agents or their employees.
In 2006, I called for a federal price gouging law with real teeth to identify and throw the book at the culprits and make them feel the pain they inflict on consumers. I cosponsored the Federal Price Gouging Prevention Act to give the FTC explicit authority to investigate and severely punish those who artificially inflate the price of energy, especially those at the top of the chain, like ExxonMobil. The House passed the bill, but Big Oil’s friends have stalled it in the Senate.
It’s now time to go after off-market energy speculators whose high rolling practices are unseen and unregulated, but affect household budgets from Portland, Maine, to Portland, Oregon. These are the greedy crooks behind the California and Enron scandals. I support the Close the Enron Loophole Act, legislation to hold them accountable to the same rules that already govern on-market traders.
The 2005 Cheney energy bill gave Big Oil $14 billion of unjustified tax breaks. It was a disgrace then. Today, with Big Oil’s astronomical profits, it is an outrage to American taxpayers. I voted against the 2005 tax breaks and am pleased that the House, under new leadership, voted to roll them back. But in the Senate, Big Oil’s allies have blocked a rollback vote.
Finally, small business, the engine that drives Maine’s economy, needs relief. Fuel prices have left the balance sheets of truckers, fishermen, loggers and other Maine fuel-dependent small businesses awash in a sea of red ink. I introduced the Small Business Fuel Cost Relief Act after Hurricane Katrina and again this Congress. It would allow businesses to claim a tax credit on the amount they spend on fuel in excess of the price on Labor Day 2004, adjusted for inflation. My bill also raises the IRS Standard Mileage Rate to 60 cents for business owners who use their vehicles for business purposes.
We are winning the battle in the U.S. House of Representatives. It’s time for the Senate to join us and pass these long overdue bills.
Driving down the cost of diesel fuel for our truckers
By U.S. Senator Susan Collins
The skyrocketing price of diesel fuel is putting an increasing strain on our trucking industry. To illustrate the problem, consider this fact: in 1999, a Maine truck driver could purchase $500 of diesel fuel and drive from Augusta all the way to Albuquerque, New Mexico. Today, a driver who purchases $500 of diesel and leaves Augusta would not even make it to Altoona, Pennsylvania, and because diesel prices continue to increase, the problem is only getting worse.
I recently met with Kurt Babineau, a small business owner and second generation logger and trucker from the Penobscot County town of West Enfield. Like so many of our truckers, Kurt has been struggling with the increasing costs of running his operation. All of the pulpwood his business produces is transported to Verso Paper in Jay, a 165-mile roundtrip. This would be a considerably shorter trip except that current federal law forbids trucks weighing more than 80,000 ponds from driving on I-95 north of Augusta. Instead, these heavy trucks are forced off the modern four-lane, limited-access highway and onto smaller, two-lane secondary roads that pass through cities, towns, and villages.
This law not only increases the distance that trucks must travel, it increases their travel time and results in a higher consumption of diesel fuel. In fact, Kurt estimates that permitting his trucks to travel on all of I-95 would save him 118 gallons of fuel each week. At approximately $4.50 a gallon, and including savings from his drivers spending less time on the trip, he could save more than $700 a week, and more than $33,000 and 5,600 gallons of fuel each year. These savings would not only be beneficial to Kurt’s bottom line, but also to his employees, his customers, and to our nation as we look for ways to decrease the overall fuel consumption.
To help provide assistance to our truckers, I recently introduced the Commercial Truck Fuel Savings Demonstration Act, with Senator Olympia Snowe cosponsoring the bill. Our legislation would create a two-year pilot program that would permit trucks carrying up to 100,000 pounds to travel on the federal interstate system whenever diesel prices are at or above $3.50 a gallon.
Permitting trucks to carry up to 100,000 pounds on federal highways would lessen the fuel cost burden on truckers in three ways. First, raising the weight limit would allow more cargo to be put into each truck, thereby reducing the numbers of trucks needed to transport goods. Second, trucks carrying up to 100,000 pounds would no longer need to move off the main federal highways where trucks are limited at 80,000 pounds and take less direct routes on local roads requiring considerably more diesel and extended periods of idling during each trip. Finally, trucks traveling on the interstate system would save on fuel costs due to the much superior road design of the interstate system as compared to the state and local roads.
Trucking is the cornerstone of our economy, as most of our goods are transported by trucks at some point in the supply chain. Some independent truckers here in Maine have already been forced out of business due to rising fuel costs. More businesses are facing a similar fate, if relief is not provided. The Commercial Truck Fuel Savings Demonstration Act offers an immediate and cost-effective way to help our nation’s struggling trucking industry and individual drivers like Kurt Babineau.
While the debate in Congress and across the country continues, soaring energy prices are becoming an increasing burden for our nation’s trucking industry, and that passes even more burden onto consumers. While some talk only about the problems, my legislation is one solution to provide immediate relief for an already struggling industry and the poor economy.