June 25, 2015

The Senate Environment and Public Works Committee yesterday approved, by a unanimous vote of 20 to 0, a highway reauthorization bill providing $277.4 billion in Highway Trust Fund contract authority for the Federal Highway Administration over the six-year period of fiscal 2016 to 2021. (This total does not count money provided to get agency programs through the last two months of FY 2015, and when $100 million per year in pre-existing mandatory spending is added, the six-year FHWA spending total is $278.0 billion.) The bill is S. 1647, the “Developing a Reliable and Innovative Vision for the Economy Act” (DRIVE Act).

After the markup, EPW chairman Jim Inhofe (R-OK) and ranking minority member Barbara Boxer (D-CA) released a statement that said that “Today our committee proudly took a step forward in advancing our nation’s economic interests by unanimously passing the DRIVE Act, a six-year surface transportation bill. The time to act is now so that Congress can provide states and local communities with the certainty they deserve in rebuilding our roads and infrastructure. We will be working with Senate leadership to bring this bill to the Senate floor before the Highway Trust Fund expires at the end of July.”

There were relatively few amendments offered during the committee’s business meeting, because as in the past, the panel was operating under “Big Four” procedures whereby the base bill, as well as any amendments, had to have the unanimous support of Inhofe, Boxer, and Senators David Vitter (R-LA) and Tom Carper (D-DE) before moving forward. The only amendments adopted in committee were a bipartisan manager’s amendment and an en bloc package of four amendments offered by committee members. The text of S. 1647 as introduced is here and the text of the managers’ amendment is here and the text of the four other amendments adopted en bloc is here.

The bill now faces an uncertain future. A full surface transportation bill will have at least three other components. The Commerce, Science and Transportation Committee needs to report titles of the bill extending highway safety and motor carrier safety programs. The Banking, Housing and Urban Affairs Committee needs to report a title of the bill extending mass transit programs. And the all-important Finance Committee has to extend the current taxes that support the Highway Trust Fund and also find tens of billions of dollars in extra funding to pay for the spending under the bill that cannot be supported by existing HTF taxes. (At Congressional Budget Office baseline levels, a six-year bill for all HTF programs was expected to need an additional $92 billion to get to the last day of the bill. With the above-baseline spending in the DRIVE Act, that total has risen to around $103 billion above current law tax levels. See the tables below.)

The Finance Committee is the most important piece of the puzzle because they control the revenue and thus the overall size of the bill. But the three committees on the spending side of the equation are taking different approaches. The EPW Committee has decided to set spending levels in advance of receiving a revenue number, and then downsize and possibly shorten their bill if the eventual revenue number will not sustain the entire program. The Commerce Committee is reportedly hard at work on its safety titles of the bill and hopes to have something marked up shortly after Congress returns from the July 4 recess (and this will probably also be before Finance gives them a number).

By contrast, mass transit stakeholder groups have been told that the Banking Committee is more likely to wait for Finance to give them a revenue total for the Mass Transit Account of the HTF before they write a spending bill.

Current Highway Trust Fund spending authority expires at midnight on July 31, and some form of extension (whether in a multi-year reauthorization bill or in another shor-term extension) to prevent furloughs at the Federal Highway Administration from beginning on Monday August 3 and to prevent reimbursements to state DOTs from being suspended at the same time.

Both Finance and their House counterpart (the Ways and Means Committee) are holding public hearings on how to solve the highway revenue situation while also having discussions behind the scenes, and the two panels appear to be a long way apart on the overall structure and timing of any HTF revenue fix. (See the articles summarizing last week’s Finance hearing and this week’s Ways and Means hearing elsewhere in this issue.)

It now looks likely that whatever HTF legislation is passed by the Senate before the end of July (whether that is a six-year bill, a four-year bill, a two-year bill, or just another extension to December 31 of this year) will also carry an extension of the charter for the Export-Import Bank, which could complicate the decisions faced by many Democrats who have promised to oppose any further short-term extensions of HTF programs but who also are strong supporters of Ex-Im reauthorization.

Yesterday’s markup was brief and largely anticlimactic. Chairman Inhofe (R-OK) said that “As I have said many times, my top priority this year is to pass a fiscally-responsible, long-term highway bill. Ranking Member Boxer, Senator Vitter, Senator Carper and I have worked hard to put together a six-year bill that we believe will put America back on the map as the best place to do business.”

Ranking minority member Barbara Boxer (D-CA) said that while Democrats preferred a more “robust” bill, they were happy with the outcome. (Boxer also said that she ran into House Speaker John Boehner (R-OH) in a Capitol hallway yesterday, and that he told her he supports the concept of a six-year transportation bill, an that she had had encouraging discussions with the staff of Senate Majority Leader Mitch McConnell (R-KY).)

Subcommittee chairman David Vitter (R-LA) also spoke about the need to pass a six-year bill as soon as possible, and Sen. Tom Carper (D-DE), who was supposed to be ranking minority member on the transportation subcommittee but who was bumped by Boxer (who wanted both roles for herself), who also serves on the Finance Committee, spoke of the desire of Finance and House Ways and Means members to find more cost-effective ways to build infrastructure and the progress made by the bill in that regard.

The only amendments adopted by the EPW Committee were an Inhofe-Boxer-Vitter-Carper managers’ amendment and a package of four amendments offered by committee members accepted en bloc, all of which were adopted by unanimous consent . The managers amendment mostly contained technical corrections to the base bill but also contained a special MPO designation for the Lake Tahoe area (obviously for Minority Leader Harry Reid (D-NV), a former EPW member) and a repeal of the limitation contained in section 5028(a)(5) of the Water Infrastructure Finance and Innovation Act of 2014 (P.L. 113-121) that prevents WIFIA loans from going to projects financed in any way by tax-exempt municipal debt or with federal tax credits. It also made changes to the population density thresholds for several rural set-asides and other special treatments were increased in order to make more states qualify as rural. (We think that the 80 persons-per-square-mile threshold in the managers amendment was set to allow West Virginia access to those programs.)

Senators had filed a much larger number of amendments which were not acceptable to one or more of Senators Inhofe, Boxer, Vitter and Carper and were thus not included in the en bloc package or the managers amendment, and some Senators took time to discuss the issues that were addressed in their rejected amendments.

Sen. Sheldon Whitehouse (D-RI) did not offer an amendment but referred to the need to take steps to address the effect that rising sea levels will have on transportation infrastructure, and Sen. Roger Wicker (R-MS) concurred.

Sen. Jeff Sessions (R-AL) complained that the spending increases in the bill were excessive (he had filed an amendment limiting the spending increases in the bill to the rate of inflation).

Sen. Wicker spoke of an amendment he had filed with Sen. Cory Booker (D-NJ) that he might offer on the floor that would have set aside 10 percent of state formula apportionments for a competitive process where cities, counties and MPOs would have a greater say in their project requirements (at the expense of state DOT discretion).

Sen. Ben Cardin (D-MD) thanked the EPW leaders for looking out for the transportation alternatives program and said he would not offer his own amendment increasing funding for the program. Cardin also offered and withdrew an amendment consisting of the text of the Administration’s GROW AMERICA Act.

Sen. Kirsten Gillibrand (D-NY) talked about her amendment (with Sen. Jeff Merkley (D-OR) to help save the bees, which was included in the en bloc package. She then offered and withdrew another amendment to allow bridges not on the National Highway System to be eligible for NHPP funding (she said she would try to offer the amendment on the Senate floor).

Many of the Senators present (and, of course, many Senators who are not on the EPW Committee) hope to offer amendments to the DRIVE Act on the Senate floor. But the Senate traditions for an open, freewheeling amendment process have been badly damaged in recent years under the leadership of both political parties, and if a mult-year surface transportation bill does come together in July and go to the Senate floor, it is an open question just how many amendments, if any, will be allowed to be offered to the bill (or, more accurately to the McConnell substitute that will contain the EPW, Banking, Commerce and Finance bills in one complete package).

A series of fine-print tables summarizing and analyzing the funding in the bill can be found on pages 6 through 15 of the PDF version of this week’s issue, here. They include:

• A table of funding authorizations in the DRIVE Act as reported.
• A one-page summary of the highway apportionment process under the DRIVE Act.
• A series of tables showing state-by-state highway contract authority apportionments via formula under the DRIVE Act as reported.
• A revised section-by-section summary of the DRIVE Act as reported (including all changes made by the managers amendment and the en bloc amendment adopted in committee).

A summary of the en bloc amendment follows.

En bloc amendment package:

• Fischer amendment #1 as modified, to amend sec. 1014 of the bill to clarify that it is states, under the advisement of their freight advisory committees who get to increase the designated miles on the national freight network in that state, not the freight advisory committees directly. Changes requirements for state freight plans to require a description of innovative technologies and operational strategies instead of “evidence of consideration” of same.
• Gillibrand-Merkley amendment #1 as modified, adding a new section to the bill to direct the Secretary of Transportation to use existing authorities, programs, and funding to encourage and facilitate pollinator habitat efforts by willing state DOTs and other transportation right-of-way managers.
• Whitehouse amendment #2 as modified, adding a new section to the bill to direct FHWA to commission the Transportation Research Board to conduct a study on the performance of bridges that received funding under the innovative bridge research and construction program under the TEA21 law.
• Wicker-Booker amendment #2 amending section 2001 of the bill to allow local governments and MPOs to receive grants and enter into cooperative agreements under the Technology and Innovation