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Highway Bill at a Crossroads

JAN 26, 2012 6:37pm ET
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WASHINGTON — A day after Transportation Secretary Ray LaHood stunned the transportation community by saying it is “highly unlikely” Congress will pass a long-term reauthorization bill to fund highway and transit programs this year, lawmakers and industry lobbyists vowed to keep pushing for such legislation despite considerable obstacles.

Speaking at a meeting of the Transportation Research Board here on Wednesday, LaHood doubted lawmakers would be able to pass the first multi-year bill funding the nation’s surface transportation system since the 2005 highway and transit authorization bill, known as SAFETEA-LU, expired on Sept. 30, 2009. 

Congress has since passed eight extensions to the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users, the latest of which will expire on March 31.

LaHood’s grim prediction for the legislation — which transportation industry lobbyists maintain is crucial to creating much-needed jobs and maintaining American infrastructure — stems from the contentious partisan atmosphere of a pre-election session and significant differences between House and Senate proposals.

The Senate Environment and Public Works Committee unanimously passed a, $109 billion, two-year highway and transit bill in November.

The bipartisan legislation, called Moving Ahead for Progress in the 21st Century, or MAP-21, was pushed by both committee chairman Barbara Boxer, D-Calif., and the top Republican on the panel, Sen. James Inhofe, R-Okla. But House Transportation Committee chairman John Mica, R-Fla., said this week that he planned to introduce a five-year bill next week.

That plan faces a major obstacle concerning funding, because it is estimated to cost as much as $260 billion — $50 billion more than available revenues from the highway trust fund.

The bill is expected to be financed with revenues from expanded domestic oil drilling, but Boxer has warned that proposal would not fly in the Democrat-controlled Senate.

President Obama suggested in Tuesday’s State of the Union Address that savings from reduced wartime spending could be reinvested in infrastructure, but that idea drew as little enthusiasm from Mica as Mica’s funding solution did from Boxer.

“America needs to rebuild its infrastructure, but I do not support what appears to be the president’s plan to finance that effort by downsizing the military,” he said.

The two-year Senate bill is about $12 billion short of necessary revenues, though Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee, has said he will find the money.

Boxer released what she called a “historic” letter Thursday, signed by more than 1,000 organizations supporting the SAFETEA-LU legislation pending in the Senate and calling on lawmakers to find the money to make the proposal work.

“There is no excuse to delay further, especially when the transportation authorization expires on March 31,” Boxer said. “As chairman of the Environment and Public Works Committee, I call on every Senator to work across party lines to find the necessary funds to move forward on this critical jobs bill.”

Despite that strong show of support for the Senate plan, the transportation industry would prefer to see the five-year bill now that Republicans have dropped an earlier proposal to cut funding levels by 33% in a six-year bill.

“We need the longer bill,” said Paul Yarossi, president of HNTB Holdings Ltd. and chairman of the American Road and Transportation Builders Association.

Janet Kavinoky, executive director for transportation and infrastructure at the U.S. Chamber of Commerce, said she is supportive of efforts to produce a five-year bill and expressed surprise at LaHood’s open skepticism just a day after Mica said he would soon introduce the legislation.

“I don’t know why the secretary would say we’re not going to get a bill this year,” Kavinoky said.

Though she conceded that “of course, there’s always a chance” that nothing will come together, most industry advocates remain publicly upbeat despite the challenges inherent in reconciling two very different plans short of revenue.

“I take this as a hopeful sign,” Kavinoky said of the impending GOP proposal.

If Congress doesn’t act by March 31, the ability to collect and place gas and other user taxes in the highway trust fund will expire at that time and the fund could lose $110 million per day.

Another incentive to pass a multi-year bill is industry pressure to grant planners some financial stability they can count on, a point LaHood himself has made numerous times.

“Major transportation projects take years of planning, design, construction and investment,” said John Horsley, executive director of the American Association of State and Highway Transportation Officials.

“State departments of transportation need the certainty and stability that a multi-year authorization bill brings,” he said. “Passing one short-term extension after the other is not the answer.”

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