DALLAS -- An $8.1 billion plan from the chairmen of two powerful House committees to stave off insolvency of the Highway Trust Fund for another five months would keep federal transportation reimbursements flowing to states through Dec. 18.
The proposed 34th short-term patch of the HTF in seven years was proposed Monday night by Rep. Paul Ryan, R-Wis., chairman of the House Ways and Means Committee, and endorsed by Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee.
The five-month fix would keep highway construction going while giving lawmakers enough time to agree on a sustainable revenue source for the HTF, Ryan and Shuster said. The current two-month patch is set to expire July 31.
"This country needs a long-term plan to fix our roads, bridges, and other infrastructure, and this bill gives us our best shot at completing one this year," the two lawmakers said in a joint statement. "By providing resources through the end of the year, we can ensure construction continues while we work toward a package that could close the trust fund's shortfall for as many as six years."
Transportation Secretary Anthony Foxx notified state officials Tuesday that the Federal Highway Administration will be unable to either make reimbursements for on-going projects or incur new obligations on Aug. 1 if the HTF is hits a low-balance threshold as expected when the short-term patch ends.
Collections from federal fuels taxes and other revenues dedicated to the HTF will run out in September but the cash management policy will go into effect as soon as the cash balance in the highway account dips to $4 billion, Foxx said.
"FHWA will not have the authority to provide project sponsors with any additional contract authority for new or ongoing projects," Foxx said in a letter to state transportation directors. "FHWA will be required to furlough employees, which means your agency will cease having access to personnel who assist with all highway projects, not just with processing payments, but also project approvals, environmental actions and permitting, authorizations for new projects and modifications to existing projects, technical assistance, and other vital activities."
Ryan's proposal requires a $1.5 billion transfer from the general fund to extend the HTF through the end of the federal fiscal year on Sept. 30 and another $6.5 billion shift to keep it solvent through Dec. 18.
The biggest offset for the $8 billion transfer would be $3.1 billion of security fees paid by airline passengers that will be retained as savings through fiscal year 2026 rather than 2024 as in current law.
Measures to tighten compliance with federal tax laws would make up the remaining $5 billion, according to a fact sheet distributed by Ryan and Shuster. Offsets in the plan include $1.8 billion by requiring lenders to provide additional information about mortgages to the Internal Revenue Service, $1.5 billion from a requirement that estates must report the value of inherited property as of the owner's death, and $1.2 billion by giving the IRS six years rather than three to investigate some tax shelters.
Meanwhile, Senate leaders are still debating legislative ideas.
Senate Environment and Public Works Committee Chair Sen. James Inhofe, R-Okla., and Sen. Barbara Boxer, D-Calif., the ranking Democrat on the panel, said the best hope for a long-term transportation bill this year is the six-year DRIVE Act approved by the committee on June 24.
"No more excuses," Inhofe and Boxer said Monday. "Let us pass the six-year Environment and Public Works Committee transportation bill, and pass it now."
