DALLAS — Tolling and transit advocates praised President Obama's $302 billion, four-year transportation funding legislation, but others doubt if lawmakers can approve a new highway bill before the current funding measure expire on Sept. 30.
The proposed Grow America Act that was sent to Congress on Tuesday would adopt many of the provisions of the current two-year Moving Ahead For Progress in the 21st Century surface transportation funding law.
The authority for MAP-21 will expire with the passing of fiscal 2014, but that is at least a month after the Transportation Department is expected to curtail reimbursements to states for highway projects as the balance in the Highway Trust Fund dwindles away.
Jack Basso, principal of consultants Peter J. Basso & Associates LLC, said that with elections coming in November, Congress probably will not pass a long-term highway funding measure before time runs out for MAP-21.
The previous highway funding bill was extended 10 times before MAP-21 was approved in 2012.
"My guess is that, before the election, MAP-21 gets extended," said Basso. "There is very, very little time before the election to handle such complex issues such as corporate tax reform and how to deal with the Highway Trust Fund."
The Highway Trust Fund will have to be "patched" to keep it functioning until a more sustainable revenue source can be found, he said.
Revenue from federal gasoline and diesel taxes have been stagnant for several years, requiring regular infusions into the Highway Trust Fund from general fund collections to meet the demand for project funding.
The president's $302 billion highway bill would supplement the Highway Trust Fund with $63 billion from an amended corporate tax code that captures the foreign earnings of U.S. companies.
"There's no doubt the Highway Trust Fund desperately needs a better revenue source," said Basso, who is former director of program finance and management at the American Association of State Highway and Transportation Officials and currently a senior advisor to Parsons Brinckerhoff.
"It's not a bad idea," he said. "The investment in infrastructure needs to be made, but comprehensive tax reform is going to be difficult to execute before an election."
The Senate Finance Committee, will hold a hearing on Tuesday on new avenues for funding highways and transit. Witnesses will include Jayan Dhru, managing director for infrastructure ratings at Standard & Poor's, Virginia Transportation Secretary Aubrey Layne Jr., and Joseph Kile from the Congressional Budget Office.
Sen. Barbara Boxer, chairman of the Senate Environment and Public Works Committee, said in March she hoped to deliver a six-year transportation bill in April.
"My goal is to move swiftly this spring to pass a long-term reauthorization bill in the committee that provides six years of funding certainty," she said March 26 during a hearing on MAP-21. "In April, we're marking up this bill."
A spokesman for the committee did not respond to a request for a schedule update.
Michael Melaniphy, president of the American Public Transit Association, applauded the $72 billion in the president's bill for public transportation over four years.
"The proposal would help address the large backlog of state-of-good-repair needs related to bus and rail transit and help expand the public transportation infrastructure to meet the growing demand," he said.
The Grow America Act also provides $4 billion for Transportation Infrastructure and Innovation Act loans and $5 billion for Transportation Investment Generating Economic Recovery grants, which can be used as the credit subsidy to support TIFIA loans.
With congressional approval, the Obama highway bill would remove the prohibition on states levying tolls on most existing interstate highways, tunnels, and bridges.
Patrick Jones, executive director of the International Bridge, Tunnel and Turnpike Association, defended the interstate highway toll proposal as "a bold plan" and said it would give states a new revenue source. Toll revenue has funded road, tunnel and bridge projects in 35 states, he said.
"To ensure our roads and bridges remain safe and reliable requires a variety of solutions," Jones said. "All options should be on the table so that states can choose the funding methods that work best for them."
The trucking industry is "very disappointed" in the tolling proposal, said Bill Graves, chief executive officer of the American Trucking Association. The group supports increases in federal gasoline and fuel taxes to replenish the Highway Trust Fund.
"Any proposal that moves away from a user fee-funded transportation system is not going to be acceptable to the American trucking industry, period," Graves said. "The focus must be on real, long-term funding answers rather than repeatedly looking for the proverbial 'nickels in the couch cushions.'"
ATA vice president Dave Osiecki criticized the Grow America Act's proposal to restructure and rename the Highway Trust Fund as the Transportation Trust Fund with a new, separate rail account in addition to the existing highway and transit accounts.
"It is clear that this administration is aiming to hijack the Highway Trust Fund and convert it into a fund to finance a myriad of projects to benefit interests that do not pay user fees into the fund," Osiecki said.
Miles Morin, a spokesman for the Association for Toll-Free Interstates, said tolls won't solve the transportation funding problem. Association members include United Parcel Service, Federal Express, and the American Motorcycle Association.
"Tolling has proven to be an inefficient mechanism for collecting transportation revenue, consuming up to 20% of revenue generated, and those paying the toll may not even see that road improved because the president's plan would allow toll revenue to go to other projects in the state," Morin said.
"It's bad policy," Morin said. "Transportation infrastructure needs improvements, but of all the ways to fund them, tolling existing interstates is the worst."
