Highway-Fund Rescue Effort Gets Started in Senate

Barbara Boxer’s panel rolls out a bipartisan transportation bill as President Obama hits the Tappan Zee Bridge.

TARRYTOWN, NY - JANUARY 09: The Tappen Zee Bridge is seen on January 9, 2014 in Tarrytown, New York. A recent cold spell, caused by a polar vortex descending from the Arctic, caused large ice floes to form in the Hudson.
National Journal
Billy House
May 13, 2014, 4:55 p.m.

With Pres­id­ent Obama set to vis­it New York’s Tap­pan Zee Bridge on Wed­nes­day to draw at­ten­tion to the na­tion’s press­ing in­fra­struc­ture needs, a Sen­ate pan­el is plan­ning to fi­nal­ize le­gis­la­tion Thursday to au­thor­ize more spend­ing for trans­port­a­tion pro­jects.

But where the fund­ing will come from re­mains a six-year, $100 bil­lion ques­tion still to be ad­dressed.

Fed­er­al pay­ments to states for as many as 6,000 road and trans­it pro­jects could grind to a halt this sum­mer to keep the High­way Trust Fund’s bal­ance above zero, as re­quired by law. There are es­tim­ates that as many as 700,000 jobs would be lost over a year.

“The mo­ment is dire,” Trans­port­a­tion Sec­ret­ary An­thony Foxx said Tues­day at a Bloomberg Gov­ern­ment event in Wash­ing­ton, as re­coun­ted by Bloomberg Busi­nes­s­week. The trust fund, Foxx said, “is quickly run­ning to­ward in­solv­ency.”

While Con­gress in this midterm elec­tion year so far has done little to ad­dress the short­fall and in­ab­il­ity of the high­way fund to keep pace with costs, in re­cent days there has fi­nally been some le­gis­lat­ive move­ment.

The Sen­ate En­vir­on­ment and Pub­lic Works Com­mit­tee on Monday night un­veiled what it called bi­par­tis­an le­gis­la­tion to au­thor­ize an­oth­er six years of high­way pro­jects. The bill is to be marked up Thursday by Sen. Bar­bara Box­er’s pan­el; it calls for fund­ing im­prove­ments to the na­tion’s fed­er­al-aid high­way pro­grams at cur­rent levels plus in­fla­tion.

The meas­ure would main­tain cur­rent for­mu­las and would in­crease an­nu­ally the amounts each state re­ceives for the fisc­al year. In all, spend­ing on high­way pro­grams would come to $38.44 bil­lion in 2015 and rise to $42.59 bil­lion by 2020.

Amend­ments from some mem­bers are an­ti­cip­ated dur­ing the markup — in­clud­ing per­haps some deal­ing with spe­cif­ic ideas on how to pay for the fund. A blog ap­pear­ing Tues­day on the con­ser­vat­ive site Her­it­age.org cri­ti­cized the Sen­ate bill as re­du­cing flex­ib­il­ity for the states in how they spend gas-tax dol­lars, and said the bill con­tin­ues Con­gress’s “habit of in­creas­ing spend­ing when the money is not there, which is one reas­on why the High­way Trust Fund is nearly de­pleted.”

But le­gis­lat­ive aides note it is form­ally up to an­oth­er pan­el — the Sen­ate Fin­ance Com­mit­tee — to de­vise those fund­ing mech­an­isms. And the rub is that there is still no con­sensus on how to do that.

In the House, the Trans­port­a­tion and In­fra­struc­ture Com­mit­tee hasn’t yet pro­duced a com­pan­ion bill, and Chair­man Bill Shuster does not ex­pect it will do so un­til later this spring or sum­mer. But Re­pub­lic­ans led by Shuster and House Ma­jor­ity Lead­er Eric Can­tor already have ruled out any move to raise tolls or taxes on gas­ol­ine and dies­el fuel, which no longer provide enough fund­ing.

Sen­ate Fin­ance Com­mit­tee Chair­man Ron Wyden also has ques­tioned the idea of new tolls on ex­ist­ing roads, or such things as char­ging mo­tor­ists based on the miles they drive. He also says tem­por­ary fixes or emer­gency patches are not the an­swer, either, and that it will take up to $100 bil­lion just to keep the trust fund solvent for the next six years.

Even a short-term fix will re­quire $10 bil­lion to keep the fund solvent through the cal­en­dar year, says Wyden, and get­ting through fisc­al 2015 will take an­oth­er $8 bil­lion. One idea that he has floated is a re­sur­rec­tion of the Build Amer­ica Bonds pro­gram that was part of the stim­u­lus strategy in 2009. By the time the pro­gram ended after two years, he said, it had helped fin­ance more than $180 bil­lion worth of pro­jects from one end of Amer­ica to the oth­er.

In his re­marks Tues­day at the Bloomberg event, Foxx noted that the ad­min­is­tra­tion has pro­posed a four-year, $302 bil­lion pack­age that would raise some of that money by clos­ing some cor­por­ate tax breaks. Con­gres­sion­al re­ac­tion has been luke­warm.

“This is a big prob­lem for the coun­try and we’ve got to deal with it,” Foxx said.

Mean­while, when Obama ap­pears and speaks Wed­nes­day at the Tap­pan Zee Bridge, he will ham­mer home that the fed­er­al fund­ing for road and in­fra­struc­ture could soon be de­pleted — right in the middle of the sum­mer con­struc­tion sea­son.

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