DALLAS - President Obama outlined a four-year, $302 billion surface transportation plan that boosts federal highway spending by 22% a year over current levels.
"We're going to put millions of people to work, and we're going to pay for it by simplifying the tax code," Obama said in a speech Wednesday afternoon in St. Paul, Minn.
The proposal includes $206 billion for new highway projects over the four years, $72 billion for transit systems, and $19 billion for high-performance and passenger rail programs.
The proposed four-year reauthorization of the current two-year highway funding bill provides $63 billion to bolster the rapidly depleting Highway Trust Fund, which is expected to run out of money as early as August.
"If Congress doesn't pass a highway funding bill by the end of the summer, highway projects will come to a halt across the country," Obama said. "We've got a lot of work to do and we've got to get people to work," he said. "We have over a 100,000 bridges that are old enough to qualify for Medicare."
Obama also announced $600 million of competitive federal transportation grants for significant projects that can use the funding to leverage private and state investments.
The competitive grants would be the sixth round of the Transportation Investment Generating Economic Recovery grant program that was first authorized under the 2009 stimulus act. The TIGER program has provided $3.5 billion to 270 projects since it began.
The four-year reauthorization would make the TIGER grant program permanent. The proposal dedicates $5 billion to the program, with $4 billion to be allocated through competitive grants.
President Obama also will ask Congress for $1 billion a year of credit subsidies for loans under the Transportation Infrastructure and Innovation Act over the next four years.
Sen. Barbara Boxer, D-Calif., chairman of the Senate Environment and Public Works Committee, said she supported the President's reauthorization proposal.
"It's very, very good," Boxer said during a presentation to an American Association of State Highway and Transportation Officials conference. "It's exciting what they have done."
Boxer said her committee is currently working on a reauthorization of the current transportation funding bill, Moving Ahead For Progress in the 21st Century, before it expires at the end of fiscal 2014.
"It's going very well," she said. "I expect to have a five- or six-year bill ready for markup this spring, probably in April."
The new highway bill will keep federal funding at current levels plus inflation, Boxer said, with any spending increases coming through competitive grants.
Her committee only deals with the overall reauthorization bill, Boxer said, while funding for the highway program is the responsibility of the Senate Finance Committee.
Finding a way to bolster the HTF is the overriding issue in Congress, she said. "We need to save the Highway Trust Fund," Boxer said. "Failure is not an option."
Raising the 18.4 cent per gallon federal gasoline tax is not an option either, she said.
"We are not going to raise the gasoline tax," Boxer said. "We are also not going to cut education and we are not going to repeal the Affordable Care Act.
"Let's be pragmatic," she said. "Let's find a reliable, long-term funding source."
Boxer favors funding highway projects with a tax on gasoline at the refinery rather than the pump, but said that idea is not popular in the Senate.
Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, had little to say about the President's reauthorization proposal, except to note that he hopes the St. Paul speech "will bring increased focus to the challenges facing the Highway Trust Fund and the importance of the federal role in our national transportation system."
AASHTO CEO Bud Wright said he was encouraged by President Obama's plan and a proposal by Rep. Dave Camp, R-Mich., chairman of the House Ways and Means Committee, to dedicate $126.5 billion to the Highway Trust Fund.
"We look forward to working with the administration and Congress on a new surface transportation bill," Wright said. "It is good news that the administration and Congressional leadership in both houses are looking seriously at strategies to invest in transportation and maintain the solvency of the Highway Trust Fund and the programs it supports."
MAP-21 is set to expire Sept. 30 at the end of the fiscal year, but federal funding for surface transportation projects is expected to be depleted weeks earlier.
The two-year funding bill transferred $6 billion to the HTF from the general fund in fiscal 2013 and $9.7 billion in fiscal 2014 to help provide a total of $109 billion in fiscal 2013 and 2014.
Expenditures from the highway account of the HTF will total $45 billion in fiscal 2014, the Congressional Budget Office said in a recent report, with revenues expected at about $33 billion.
The CBO report said the HTF would have a revenue shortfall of $13 billion in fiscal 2015 at current spending levels as gasoline tax revenues continue to decline. The cumulative deficit would reach $113 billion by fiscal 2021.
Spending from the HTF has exceeded gasoline tax revenues since fiscal 2000.