Congress reaches $305B highway compromise
WASHINGTON – The federal government could provide $305 billion for highways, bridges and transit over five years, under compromise legislation that House and Senate negotiators released Tuesday.
The compromise, which the full House and Senate must still vote on, represents an accomplishment compared to 36 short-term extensions since the last four-year bill expired in 2009.
But beyond the gas tax that provides most highway funding, the legislation has a patchwork of supplemental funding. The next Congress and president will have to decide how to permanently fund the bill’s goals.
The agreement was announced by top lawmakers on the House Transportation and Infrastructure Committee -- the chairman, Rep. Bill Shuster, R-Pa., and Peter DeFazio, D-Ore. -- and on the Senate Environment and Public Works Committee -- the chairman, Sen. Jim Inhofe, R-Okla., and Barbara Boxer, D-Calif.
"This legislation is a vital investment in our country," the lawmakers said in a joint statement.
The Congressional Budget Office hasn't calculated the formal cost of the legislation yet. But the bill calls for $281 billion through the highway trust fund and $24 billion through annual appropriations that lawmakers could decide not to supply in a given year, according to Jeff Davis, a senior fellow at the Eno Center for Transportation.
“It might not all materialize," Davis said.
If the funding arrives, highways would receive 15% more in the final year of the legislation and transit 18% more, according to Boxer. Every state will see an increase in funding, she said.
"I expect this bill to have a huge amount of support throughout the country from businesses and workers alike," Boxer said. "Although it is not perfect, I believe it is a major accomplishment for our people who expect us to fund a top notch transportation system."
The funding stream rather than policy disputes had been the biggest sticking point during debate on the long-term bill.
Congress set the gas tax of 18.4 cents per gallon in 1993, and it hasn’t kept pace with construction demands because of inflation and more fuel-efficient cars.
To bridge that shortfall, the bill would claim $53 billion in Federal Reserve surplus funds, $6.9 billion from reducing a Federal Reserve dividend to banks, selling $6.2 billion from the Strategic Petroleum Reserve and diverting $5.2 billion from indexing fees paid to Customs and Border Protection for inflation, according to Davis.
One of the negotiators, Sen. Tom Carper, D-Del., refused to support the compromise as a "grab bag of budget gimmicks" and revenues poached from "unrelated programs for years to come."
"While the proposal includes some good transportation policies, the way the bill is paid for is simply irresponsible," Carper said.
President Obama had proposed a $478 billion bill for six years, half funded by taxing corporate profits now held overseas. But Congress didn’t embark on a corporate tax overhaul and the Republican majority blocked proposals to raise the gas tax.
In another provision, the 1,300-page legislation would revive the Export-Import Bank, which arranges loans for foreign buyers of U.S. products.
The bank’s authorization to offer new loans expired June 30, and critics argued that it should be abolished as “crony capitalism” for providing loans that businesses should obtain elsewhere. But the U.S. Chamber of Commerce among others urged lawmakers to revive the bank that provided $27.5 billion in financing for exports last year representing 164,000 jobs at 3,300 companies.
Another provision would lift the cap on damages in railway accidents to $295 million, from $200 million. The measure would be retroactive to May 12, to cover the fatal Amtrak crash in Philadelphia.
Relatives of the eight people killed and scores injured in that Amtrak crash feared their medical bills and other claims would eclipse the cap. Congress set the cap in 1997, and the increase roughly matches inflation since then.
“When accidents occur, victims and their families should be adequately compensated and not subject to an outdated liability cap,” said Sen. Bill Nelson, D-Fla., who sponsored the provision.