Obama Gives OK to House HTF Fix

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DALLAS — Chances for swift passage in Congress of an $10.8 billion temporary bailout of the sinking Highway Trust Fund improved Monday night when administration officials said they support the House committee's version of the 10-month fix.

"This legislation would provide for continuity of funding for the Highway Trust Fund during the height of the summer construction season and keep Americans at work repairing the nation's crumbling roads, bridges, and transit systems," the Office of Budget and Management said in a Statement of Administration Policy. But OMB said the bill, approved by the House Ways and Means Committee last week, does not address the need for a long-term authorization bill.

The Senate Finance Committee adopted a similar short-term measure bill last week, but it contains tax compliance and modernization provisions that the House Ways and Means Committee chairman Dave Camp, R-Mich., opposes.

The full House is expected to vote Tuesday afternoon on the Highway and Transportation Funding Act of 2014, H.R. 5021, which would extend the fund's solvency through May 31, 2015.

House Minority Whip Steny Hoyer, D-Md., predicted overwhelming approval of the committee's proposal because members fear a shutdown of construction projects if federal funding is curtailed Aug. 1 as projected.

"When you're confronted at the end with, 'You do this or we shut down,' we're not for shutting down," Hoyer said. "We think that the economy would be hurt, people would be hurt, jobs would be lost."

With the president's endorsement, Democrats in the Senate could fall in line and quickly adopt the legislation adopted by the House committee rather than the Transit and Highways Act approved by the Senate Finance Committee. With no need for a conference committee to resolve the slight differences between the proposals, the short-term fix bill could be signed later this week.

Both proposals for a quick fix would transfer to the highway fund $9.8 billion of general revenues and another $1 billion from the Leaking Underground Storage Tank Trust Fund.

The move of almost $10 billion of general fund revenues would be offset over 10 years with $3.5 billion by extending for one year some custom fees that were to expire in 2023, and more than $6.3 billion from corporate pension smoothing, which increases employers' taxable income.

The bill approved by the Senate Finance Committee and sponsored by its chairman Sen. Ron Wyden, D-Ore., does not contain a deadline and would reduce the expected revenue from the pension smoothing and customs user fees, while increasing revenue from more stricter enforcement of some existing income tax regulations.

Even if Congress quickly puts into place a short-term patch that extends the current highway bill into spring 2015, the White House said, a long-term solution to close the highway fund's structural funding imbalance should be accomplished as soon as possible.

"This legislation …does not address the continued need to pass a long-term authorization bill that creates jobs and provides certainty for cities, states, and businesses" the statement said. "Congress should work to pass a long-term authorization bill well before the expiration date set forth in H.R. 5021."

The president's $302 billion, four-year Grow America Act should be Congress's blueprint for a multi-year, fully funded transportation bill, the White House said.

"That proposal is fully paid for through existing revenues and by reforming business taxes to help create jobs and spur investment while eliminating loopholes that reward companies for moving profits overseas," the statement said.

The House committee's bailout bill is co-sponsored by Camp and Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee.

As the Democratic president gave his support to the committee's plan, conservative groups Heritage Foundation and Club for Growth urged House members to vote against the short-term fix and instead focus on giving the states responsibility for transportation spending.

"The bill would offset the additional spending over the next decade through a series of revenue raisers, budget gimmicks and budget transfers," the Heritage Foundation said its 'no' recommendation.

"An inability to control spending combined with costly regulations that inflate the cost of projects has rendered the Highway Trust Fund model functionally obsolete," the group said.

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Infrastructure Transportation industry Washington
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