DALLAS – A multiyear transportation proposal released by a congressional conference committee on Tuesday would provide $305 billion of federal funding for road, bridge, and transit projects over five years.
The $61 billion of annual federal transportation funding in the committee's Fixing America's Surface Transportation Act (FAST) tops the $52.6 billion per year of expenditures in the House plan and the $55.5 billion per year in the Senate's DRIVE Act (H.R. 22), both of which spanned six years. Expenditures from the Highway Trust Fund in fiscal 2015 totaled $53.7 billion.
Every state will receive a 5% increase in highway funding in fiscal 2016, with transit receiving an 8% increase, said Sen. Barbara Boxer, D-Calif., the ranking Democrat on the Senate Environment and Public Works Committee. In fiscal 2020, the last year of the bill (H.R. 22), highway funding will be 15% higher than in fiscal 2015 with an 18% increase for transit.
"I expect this bill to have a huge amount of support throughout the country from businesses and workers alike," Boxer said. "Although it is not perfect, I believe it is a major accomplishment for our people who expect us to fund a top notch transportation system."
The measure is fully funded with a number of revenue offsets, including a sale of some of the crude oil stored in the Strategic Petroleum Reserve and a one-time transfer of $19 billion from the Federal Reserve System's surplus fund that now totals $29.5 billion. The surplus fund would be capped at $10 billion, with anything over that amount going to the HTF.
The proposal would also cut national banks' annual dividend from the Fed from the current 6% to the rate on 10-year Treasury notes, currently at 2.2%. The dividend would be capped at the current level.
The House plan would have drawn down the Fed's entire reserve, while the Senate version cut the dividend rate to 1.5%, which would have generated $17 billion for transportation over 10 years.
Federal gasoline taxes and other levies dedicated to the HTF are expected to bring in about $200 billion over the next five years.
The conference committee missed a chance to raise revenue for transportation by retaining the prohibition on tolling existing interstate highway lanes, said Marc Scribner, a fellow at the Competitive Enterprise Institute.
"We are disappointed that Congress has once again chosen to bail out the HTF with non-user revenues rather than fix the problems that are driving it to insolvency," he said. "Congress could have shown greater support for user-based transportation funding by ending the federal prohibition on states tolling their interstate highway segments."
The conference transportation bill would provide $1.4 billion for the low-interest Transportation Infrastructure Finance and Innovation Act loan program, beginning at $275 million in fiscal 2016 and increasing to $300 million in fiscal 2020. The measure expands the program's eligibility by allowing states to use federal transportation grants to pay the subsidy and administrative costs associated with TIFIA.
The DRIVE Act would have allocated $273.4 billion for highways and $59.3 billion for transit over six years. The House had adopted an amended version of the Senate measure that authorized $261 billion of federal highway funding and $55 billion for public transit.
The funding bill must be passed by Congress and signed by President Obama by midnight Friday to avoid a halt in federal reimbursements to states when the latest short-term extension expires.
Congress will meet the Dec. 4 deadline, House Speaker Paul Ryan, R-Wis., told reporters on Tuesday morning.
"This week, we're going to have a highway bill which will help families and workers by rebuilding our infrastructure and giving a boost to our economy," he said.
