MINNEAPOLIS — The highway trust fund will face another funding crisis by August, House Transportation and Infrastructure Committee chairman James Oberstar warned at a town hall here yesterday.
“By Aug. 20, the Federal Highway Administration will notify states” that it cannot provide overnight payments of its 80% share of transportation construction payments to them, according to the Minnesota Democrat.
The shortfall will be due to repeated, precipitous declines in the revenues going into the highway trust fund, he said.
Many market participants expect a new multi-year transportation authorization bill to be delayed until next year, meaning the trust fund would need to be replenished to tide states over until the new bill is signed into law.
It would be the third time the highway trust fund has run dangerously close to being bankrupt in the past two years. The fund was rescued by a general fund transfer of $7 billion last August and $8 billion in September 2008.
The past two crises resulted in delays or cancellations of some projects and at least one bond issuance.
Oberstar and U.S. Transportation Secretary Ray LaHood did not provide any timeline for a new bill to replace the Safe, Accountable, Flexible, Efficient Transportation Equity Act: a Legacy for Users.
States have pushed for a new bill, arguing that it is difficult for them to make long-term investment plans without knowing what the federal government plans to do.
Oberstar introduced a bill last year that would overhaul federal transportation programs, but it has not advanced beyond the committee.
The Obama administration wants a multi-year bill that is “not dissimilar” from Oberstar’s proposal, LaHood said.
Sen. Amy Klobuchar, D-Minn., who sits on the Environment and Public Works and Commerce committees, said the Senate is “eagerly awaiting this bill.”
Meanwhile, LaHood offered some glimpses into funding from the American Recovery and Reinvestment Act and a possible jobs bill.
He said the $8 billion high-speed rail funding — whose recipients are expected to be announced this winter — will be targeted toward projects “all over the country, not just in certain parts of the country.”
On the potential jobs bill, Klobuchar said that even if the total package is much smaller than ARRA’s nearly $800 billion price tag, it should include a large share of transportation funding.
That could prevent at least one state from running short of its own highway funds. Wyoming is looking at its own shortfall in highway funds, said the state’s transportation director John Cox.
If the jobs bill’s transportation funding mirrors that of ARRA, the state could “pretty much break even,” he said.