WASHINGTON — Leaders on the Senate Environment and Public Works committee said they reached an agreement on principles for a surface transportation reauthorization bill and suggested funding could be raised through tax reform.
Committee leaders said Thursday they hope to pass a six-year bill that keeps the current levels of funding plus inflation. In order to do this, an additional $16 billion a year over what the Highway Trust Fund receives from gas tax revenue must be raised, committee chair Barbara Boxer, D-Calif., said.
The current transportation funding bill, Moving Ahead for the Progress in the 21st Century, expires Sept. 30. The HTF is expected run short of the money needed to reimburse states for transportation projects this summer. The HTF is primarily stocked by revenue from motor fuel taxes, but gas tax revenue has been lagging behind spending because of increased fuel efficiency and a decline in vehicle miles traveled.
Other principles for the legislation include maintaining the formulas for existing core programs, focusing on policies that expand opportunities for rural areas, continuing efforts to leverage local resources to speed up construction for transportation projects, and requiring better information sharing about federal grants, Boxer said.
The Transportation Infrastructure Finance and Innovation Act program, which provides loans, loan guarantees, and standby lines of credit for surface transportation projects, will continue. Bonds can be used "as the collateral for getting the money up front" from this program, Boxer said.
A detailed outline has been developed for the parts of the bill pertaining to policy matters in the EPW committee's jurisdiction, and Senate staff are developing the legislative language. The committee expects to act on its parts of the bill in the work period following the recess that starts next week, said David Vitter, R-La., ranking member of the committee.
The Senate Commerce, Science and Transportation Committee and the Senate Banking Committee also handle pieces of the bill. Boxer and Vitter said they hope the three committees act quickly on their portions of them so they can be sent to the Senate Finance Committee, which has to figure out how to pay for the bill.
Boxer believes that Senate Finance Committee Chairman Ron Wyden, D-Ore., and House Ways and Means Committee Chairman Dave Camp, R-Mich., can agree on how to pay for transportation funding, and "what seems to be coming forward as a consensus is a piece of tax reform," rather than transferring money from the general fund to the HTF or raising the gas tax.
Tax reform is "a pragmatic solution," Boxer said, noting that she didn't think there was enough support for some other ideas.
Vitter said that he supports user fees to fund the HTF and hopes that the user fee system can be modernized in the near future. However, that is unlikely to happen in this bill, so members of Congress are looking at other options like repatriating foreign capital and other aspects of tax reform in the meantime, Vitter said.
Boxer said there seems to be interest in repatriation because "there's enough funds there to keep this trust fund going."
President Obama's fiscal 2015 budget and Camp's tax reform proposal both would use money from tax reform for the HTF. Obama's plan would provide the funds as a result of corporate tax reform, while Camp would provide money to the HTF from a one-time tax on some corporate earnings and offshore profits of foreign subsidiaries of U.S. corporations.
While many people believe these larger packages are unlikely to move, Boxer said "you never know what's going to move and what's not." While it's up to the tax writers to decide how to address the HTF, Boxer thinks that all options could be on the table, including passing part of a broader tax reform proposal.
Wyden plans to hold a hearing about transportation funding in the next work period to look at all options and has not yet decided what approach he will pursue, a spokesman for the senator said.
Sen. Tom Carper, D-Del., the chairman of EPW's transportation and infrastructure subcommittee who is also on the Senate Finance Committee, said there's probably not one silver bullet to fund the HTF. Rather, Congress is likely to need "a number of silver BBs."
The EPW committee leaders announcement came on the same day that Transportation Secretary Anthony Foxx announced that he will travel across the country starting Monday to showcase the importance of investing in transportation.
