While Congress and President Barack Obama have signed off on a $7 billion patch to fund the Highway Trust Fund (HTF) for the remainder of the fiscal year, which runs through Sept. 30, there remains uncertainty regarding the overall 2009 Surface Transportation Bill, commonly known as the highway reauthorization bill.
“I'm glad we have the patch,” said Randy Mullett, vp of government relations and public affairs at Con-Way Inc. “[But] if it's only until September, I would think there would be another patch because I don't think there is time” for a full authorization.
U.S. Rep. James L. Oberstar (D-MN), chairman of the House Committee on Transportation and Infrastructure, is pushing a $500 billion reauthorization and reports indicate he expects to move that bill out of committee once Congress returns from recess. Meanwhile, the Senate is following the lead of Transportation Secretary Ray LaHood and President Obama by proposing an 18-month process whereby the Highway Trust Fund would bankroll projects through a $20 billion to $27 billion bill until a full reauthorization could be properly developed.
Reaction is mixed on that proposal. Clayton Boyce, American Trucking Assns. vp of public affairs, said that ATA CEO and president Bill Graves “is concerned that the short-term reauthorization would not allow for policy changes that could be made with the full reauthorization” that Oberstar has indicated he wants to see passed.
“But,” added Boyce, “the choice between [passing] full reauthorization and the $20 billion short-term bill is a disagreement between Chairman Oberstar and the White House that we are not lobbying over either way.”
Mullett sees the wait a little differently. “Eighteen months, that means the bill would not go live until after the 2010 election, and funny things happen after elections,” he said. “I think [that] if cap and trade passes, it [will] put tremendous pressure on the revenue side of the highway bill.
“If [Congress approves] cap and trade, health care and the other things that [Obama is looking for], Oberstar recognizes it would make it tougher to fund his priorities.”
The full reauthorization bill is said to include many safety initiatives, although it is difficult to say what is actually included until a bill is proposed. ATA continues to push a fuel tax increase to fund infrastructure improvements.
“We supported the $7 billion because without that, the HTF would have stopped sending payments to states for highways,” Boyce said. “The long-term solution to the [HTF] shortfalls is increasing the federal fuel tax, not tolling or VMT [vehicle miles traveled] tax. Tolling and VMT taxes spend about a third of the money collected on the task of collecting it,” he added. “With the fuel tax, less than 1% of money collected is spent on the task of collecting.”
The recent American Recovery and Reinvestment Act funding has helped states jumpstart construction projects, but according to the American Association of State and Highway Transportation Officials (AASHTO), a nonprofit, nonpartisan association representing highway and transportation departments, those and future projects could be in trouble without a long-term solution.
“We've now got an industry that we are cranking up,” said Allen Biehler, AASHTO president and Pennsylvania transportation secretary. “If we don't keep that pipeline full, what's going to happen on the back side? It's a real concern.”
AASHTO executive director John Horsley said the association supports the six-year reauthorization with no wait. If that is not done, and no temporary order is in place by October, Horsley estimated that 85% of federal aid to highway programs could be in jeopardy going into the 2010 fiscal year. As an example, Biehler pointed out that Pennsylvania is spending $2.8 billion on infrastructure projects this year, but without a guarantee of federal funding, that number could be cut in half in 2010.
“Continuing with patches just continues existing policies,” Mullett said. “If you're happy with existing policies, then patches work.”