DALLAS — The $11 billion, 10-month legislative bailout of the Highway Trust Fund adopted overwhelmingly by the House would stymie the best chance for a long-term solution for transportation funding, according to most industry experts.
The House bill would extend solvency for the HTF to May 31, 2015. The extension is needed to prevent the HTF from dropping below $4 billion, the level that would cause the U.S. Transportation Department to start rationing its distribution of funds to avoid depletion of them before the current two-year highway law expires at the end of the fiscal year on Sept. 30.
But pushing that date up to Dec. 31 from May 31, 2015, as Senate Finance Committee chairman Sen. Ron Wyden, D-Ore. first proposed, could force a decision during a lame-duck session between the November election and the early 2015 beginning of the 114th Congress on a fully funded, multi-year transportation bill, they said. That chance will be lost if the Senate goes along with the House on a May 31, 2015 deadline, the experts said.
"I can guarantee you that if Congress does not make an effort to resolve this issue once and for all, it will be short-term extensions and budget gimmickry as far as the eye can see," said Dave Bauer, chief lobbyist for the American Road and Transit Builders Association.
"This problem is not going away no matter how many times they try to kick it down the road," he said.
Senators should opt for the 2014 deadline, which was first included and then taken out of an extension measure by Wyden, Bauer said.
"This is the fifth time in seven years Congress has patched the Highway Trust Fund," he said. "Since there are at least six months left in these members of Congress' terms of office, it is incumbent on them to use that time to find a bipartisan consensus."
A temporary patch is necessary to keep the highway fund functional until lawmakers agree on a long-term solution, said Avery Ash, director of federal relations for AAA, but pushing the extension beyond December is a mistake.
"The closer we get to a presidential election, the less likely Congress is to make big moves," he said. "They should raise the gasoline tax to pay for infrastructure investments, and the odds would be significantly higher for that in a lame-duck session than in the first five months of a new Congress.
"When you remove the December deadline, the urgency disappears," Ash said.
AAA president Bob Darbelnet called on lawmakers to "stop the hand-wringing" and make tough decisions on transportation funding before January.
"Any proposal that allows this issue to be pushed into 2015 would kill the momentum to find a real funding solution," he said. "Renewing the debate next year under a new Congress would start us over at square one, making it nearly impossible to secure long-term transportation funding anytime soon."
Senate Majority Leader Harry Reid, D-Nev., said the House bill will be considered before the August recess, along with a similar measure approved by the Senate Finance Committee that does not specify a termination date, and an amendment for Dec. 31 proposed by Sen. Barbara Boxer, D-Calif., chairman of a Senate committee that earlier this year approved a six-year highway bill.
Sen. Mike Lee, R-Utah, who favors giving responsibility for highway funding to the states, said he plans to offer an amendment that would lower the federal gasoline tax of 18.4 cents per gallon to 3.7 cents.
But House Speaker John Boehner is predicting that the Senate will probably adopt the House's highway fund bailout without amendments.
"It's a sound proposal," Boehner said Thursday in his weekly news conference. "That's why it got bipartisan support in the House and frankly why it's going to get bipartisan support in the Senate."
The Dec. 31 deadline is a fading hope, according to Greg Cohen, president of American Highway Users Alliance. "We'd prefer a deadline at the end of this year and we're still going to try for one, but it's pretty much a done deal now with the House approving an extension through May," he said.
Delaying the funding decision by four or five months won't make it any easier, Cohen said.
"Raising revenue is going to be difficult whenever the vote occurs. The longer we wait, the deeper the hole that we have to climb out," he said. "Raising the gas tax is the right thing to do, but next year there may be more opportunities for other tax vehicles to be considered."
Extending the fund's solvency past the end of 2014 is a deliberate effort to avoid a gas tax increase during a post-election session, said Rep. Dave Camp, R-Mich., co-sponsor of the House extension bill and chairman of the Ways and Means Committee.
Camp said he would have preferred to find the $18 billion needed to extend the fund through the end of fiscal 2015 but the $10.8 billion needed to pay the bills through May 31 is "a reasonable middle ground."
"Any effort that just goes to the end of this year will only lead to another backroom deal during the lame-duck session where only a very few members are present or have any say in the matter," Camp said. "What troubles me most about a December 31, 2014 date are those using it as a ploy to stick the American people with a massive increase in the gas tax - just about the worst tax increase Congress could hit hardworking Americans with."
The necessity of a short-term patch at this point should not obscure the need for a multi-year highway bill, said Joung Lee, director of management and program finance at the American Association of State Highway and Transportation Officials.
"States and local governments, and contractors, need at least a four-year funding window for projects," he said. "That's the minimum."
But with gasoline tax collections lagging $15 billion to $18 billion behind annual expenditures, Lee said, lawmakers will struggle to find the $100 billion or more needed to adequately fund a four to six-year transportation bill.
"I can't say if a lame-duck session is better suited to resolving the HTF's problems or not, but we recognize it's going to be painful, no matter if is this year or next," Lee said.
"The bipartisan vote in the House for the short-term extension was a great sign," he said. "Now the question is how do we find a financial bridge to a long-term solution."
