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Congress Hits the Snooze Button on Transpo Funding Until May

Someone had to cave and last night, it was the Senate.

Closed for the summer. Photo: ##http://www.capitol.gov/html/EVT_2010061578974.html##Capitol.gov##

Closed for the summer. Photo: Politic365

The upper chamber had fought as long as it could to adjust the House transportation bill so it wouldn’t expire when the GOP controls both chambers of Congress. But senators were never willing to actually let the Highway Trust Fund go broke. U.S. DOT would have started cutting back on reimbursements to state DOTs as of today in the absence of an agreement.

After the House rejected the Senate’s amendment yesterday, hours before representatives were due to return to their home districts for the five-week August recess, it seemed the Senate had no choice. Then, news broke that the House was going to stick around a little longer to keep fighting about the border crisis.

Could the Senate have taken advantage of the House’s presence to toss the football back to them, on the assumption that the last team holding it will get blamed for the fumble? Maybe. Maybe the House would have been the one to cave, then. Maybe they would have sent the transportation industry into a tailspin. In a recent poll, 85 percent of transit agencies said they would implement service cuts if that happened.

At least we were spared that. But perhaps not for long. Former U.S. DOT official Beth Osborne, now at Transportation for America, noted that each extension seems to be getting harder. “The easy ways to pay for the program are gone,” she said. “It’s going to get harder doing this with bubble gum and band-aids.”

Who cares?

Last night on Twitter, Cap’n Transit paid me the backhanded compliment of my life by saying:

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Time’s Up: 6 Things to Know About Today’s Transpo Showdown (UPDATED)

UPDATE 2:40 p.m.: The House has rejected the Senate amendment, as expected.

Today is the House of Representatives’ last day in session before departing for an August recess full of photo ops and electioneering in their districts. The Senate will stick around DC for one more day before going home. Before that happens, the two houses have to come together on a plan to keep the Highway Trust Fund going. If not, U.S. DOT will have to take drastic measures.

Republican Sen. Bob Corker disagrees with the House GOP on when the bill should expire and how to pay for a new one.

Republican Sen. Bob Corker disagrees with the House GOP on when the bill should expire and how to pay for a new one.

Both the House and the Senate have voted on not entirely dissimilar plans to keep the fund going. But the differences between them have set up a high-stakes showdown that has to be resolved by tomorrow.

Here are the key points:

    1. The timing: The House is expected to vote on the Senate bill today at about 3:00 p.m. and is expected to refuse to budge. Then they’ll leave town, meaning the Senate can either cave or be blamed as the Highway Trust Fund goes dry before August recess ends and transportation works grind to a halt. Meanwhile, Sec. Anthony Foxx has warned state DOTs that federal payments will slow down August 1 — that’s tomorrow — if Congress doesn’t take action to keep the Fund from going insolvent.
    2. The numbers: The House is gloating that the Senate’s bill contains a $2 billion technical error — which is true; it comes up with just $6.2 billion of the $8.1 billion needed — but Senate Democrats say it can be easily fixed.
    3. The urgency: Since summer is the high season for construction, the real pressure on the Highway Trust Fund is between now and the end of the year, when states will need to get reimbursed for the work that’s going on now. That’s why there’s not a huge monetary difference between the House proposal that lasts till May and the Senate proposal that ends in December. There’s just not a lot of cash going out the door at U.S. DOT between January and May.
    4. The conflict: The House and Senate disagree on what budget gimmicks to use to “pay for” the transfer into the trust fund, but more fundamentally they disagree about how long the patch should be. As we’ve reported before, Boxer prefers a December deadline, saying it’s unfair for this Congress to fail to fix a problem that occurred on its watch and instead kick it to the next Congress. What she means is that she wants her six-year bill to pass and that won’t happen after the end of this year if the GOP wins a majority in the Senate and she loses the chairmanship of the EPW Committee. That’s precisely why the House is gunning for a May deadline.
    5. The breakdown: The Senate Republicans aren’t as enthusiastic as the House about having to take this up when they’re in charge. Thirteen Rs joined the Ds in pushing for a December sunset, including Sen. Bob Corker (R-TN), who wants to raise the gas tax and be done already. “Wouldn’t it be great to finish 2014 actually solving one issue; taking one issue off the plate next year?” he said yesterday at a WSJ press breakfast. Only one Democrat, Jeanne Shaheen of New Hampshire, voted no on Boxer’s date-change amendment. Notably, David Vitter, the ranking member on the EPW Committee, who has shown great bipartisan unity with Boxer, broke with her on this and voted to essentially flush their six-year-bill down the toilet. His predecessor, James Inhofe, voted in favor of Boxer’s December 19 deadline.
    6. The fallout: If the GOP does win the Senate in 2014, the conventional wisdom says they’ll lose it again in 2016. Will the Republicans really want to take on a tax increase of any kind during the only two years when they’ll get the lion’s share of the blame? Of course not. The prognosis is that if there’s no long-term bill this term, it’ll be another three years. Three more years of patchwork funding gimmicks is nothing to look forward to.
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Dems Grudgingly Approve House Transpo Extension’s Disastrous Timeline

Yesterday, during the one-hour debate period over the House proposal to extend transportation funding through May 31, lawmaker after lawmaker stood up to condemn the bill. America needs a long-term transportation bill, they said. A short-term stopgap only creates more uncertainty.

Rep. Earl Blumenauer was one of just 10 Democrats to reject the House extension.

Rep. Earl Blumenauer was one of just 10 Democrats to reject the House extension.

And then they voted for it.

More Democrats than Republicans voted for it, in fact, despite standing up and declaring that “a short term solution is not enough” or that it’s “just another kick-the-can-down-the-road approach” or that it’s just “a little shuffling around of money so we can pretend… we’re not creating more debt.” But in the end, the Highway and Transportation Funding Act passed easily, with only 10 Democrats and 45 Republicans voting against it.

Peter Welch of Vermont was one of those no-voting Democrats. During the floor debate, he called the bill an “abdication of our responsibility.”

“Some folks are saying we need time to put together a long term bill,” he said. “We’ve had time. What we need is a decision.”

Earl Blumenauer is in favor of an extension, but only through the lame duck period after the election. He voted no as well, criticizing Republicans for failing to have a “deliberate, thoughtful process.”

“We have not had a single hearing on transportation finance in the Ways and Means Committee all year,” he said. “We didn’t have one the year before that. We haven’t had a hearing in the 43 months that the Republicans have been in charge.”

So here’s where things stand: The Senate Finance Committee has passed a largely similar bill, with the same amount of money coming out of slightly different funding sources.

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House, Senate Take Different Paths to Prop Up Transportation Funding

This morning, the House Ways and Means Committee passed its plan to prop up the Highway Trust Fund — which pays for transit and bike/ped infrastructure in addition to roads — until May 2015. A few hours later, the Senate Finance Committee approved a plan of its own, with no deadline attached.

Sens. Ron Wyden (D-OR) and Orrin Hatch (R-UT), the two top dogs on the Finance Committee, agreed on a bill that matches the dollar amount in the House bill — $10.8 billion. Wyden’s original proposal had the bill expiring December 31, but the final bill didn’t have any deadline in it at all. The fact that the Senate matched the House bill dollar for dollar, however, indicates that they’re leaving the door open to extend it all the way to May 31, like the House.

Sen. Barbara Boxer, chair of the Environment and Public Works Committee, said she was grateful to the Finance Committee for agreeing on a “shorter-term patch” and still hoped to pass a long-term bill by December, though it’s unclear that’s what the Finance bill does.   

As I said yesterday, an extension through May would be a huge blow to Democrats, who would prefer to see the extension expire by the end of this year in hopes of forcing action on a long-term bill while Democrats still control the Senate.

The Senate bill adds in some of the House’s pay-fors too, including $2.7 billion raised from “pension smoothing,” which is generally viewed as a gimmick that doesn’t raise any actual money long term. The House plan takes $6.4 billion from pension smoothing, but Wyden wanted to reserve some of that money — fictitious though it may be — for other purposes. You can read the Senate’s full list of pay-fors here [PDF].

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House Proposes 8-Month Transpo Bill In Hopes for a Republican Senate in 2015

While a six-year Senate transportation bill languishes in partisan purgatory, the House Ways and Means Committee has proposed an eight-month patch that would backfill the Highway Trust Fund until May 31, 2015. That would punt the transportation bill debate until a new Congress takes over — one that’s expected to have Republican majorities in both chambers.

Ways and Means Chair Dave Camp wants to let the next Congress deal with transportation funding. Photo: ##http://camp.house.gov/photos/##Office of Dave Camp##

Ways and Means Chair Dave Camp wants to let the next Congress deal with transportation funding. Photo: Office of Dave Camp

Ways and Means Chair Dave Camp earlier proposed “business tax reform” to fund transportation — as did President Obama — but even those powerful champions on both sides of the aisle weren’t enough to get traction on that idea.

The new Ways and Means proposal abandons both that idea and the Republican scheme to use post office cuts to offset losses to the Highway Trust Fund (which also funds transit and active transportation infrastructure, by the way). Instead, it opts for a smattering of fiscal gimmicks and fees unrelated to transportation with a previous record of success in the Senate.

Meanwhile, Sen. Ron Wyden (D-OR), chair of the Senate Finance Committee, is trying to get the full chamber to consider his extension bill, the PATH Act — that stands for Preserving America’s Transit and Highways — which has its own complex web of pay-fors.

While the Senate bill has been larded up with amendments that are unlikely to go anywhere, neither bill, at its core, includes any policy changes. Both are just stopgap funding fixes, and substantially similar ones at that.

The only substantive difference between the House and Senate proposals is the length. Wyden’s bill would require further action after the elections (as lawmakers agree is necessary) but before the new Congress is seated. Ways and Means Chair Dave Camp explained in a statement why he opposes that plan:
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Why the Federal Funding Emergency Matters for Transportation Reform

Why does it matter if state departments of transportation get less money?

In light of last week’s news that the U.S. DOT might have to ration its payments to states in the absence of new revenue for the federal transportation program, we posed that question to David Goldberg, communications director at Transportation for America. After all, a lot of states are pursuing wasteful boondoggles, like Kentucky’s Ohio River Bridges Project and the Illiana Expressway.

Several states have said they will hold off on planning new projects until they have some certainty that they will be reimbursed with federal funds. And if Washington can’t deliver those funds, good projects will be shelved as well as bad, Goldberg said.

Transit agencies will also feel the pain if Congress can’t come up with a funding solution. The Mass Transit Account of the Highway Trust Fund, which provides money to the nation’s transit agencies, is running low and on track to go into the red by October. ”Transit agencies are starting to say, ‘We better not let contracts because we don’t know where the money’s coming from,’” he said

Losing any portion of federal funding for transit agencies would be “devastating,” said Goldberg, as many of them are already stretched very thin.

Furthermore, Goldberg said that if Washington can’t find a solution to the transportation funding problem, it will bode poorly for attempts to solve other problems — like enacting federal policies that make transportation safer, greener, and more efficient.

“This is an opportunity for people in Congress, for Americans in general, to consider what the point of these programs are,” he said. “If we can’t take it seriously, we can’t ask for those progressive things.”

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With No Transport Funding Fix, USDOT to Cut Payments to States Next Month

Click to enlarge. Next month, the Highway Trust Fund -- the funding mechanism for the nation's transportation system -- will become insolvent next month without Congressional action. Chart: FHWA

Click to enlarge. Next month, the Highway Trust Fund — the funding mechanism for the nation’s transportation system — will become insolvent unless Congress acts. Chart: FHWA

State transportation departments could see the federal funding they receive pared back as early as a few weeks from now if Congress doesn’t come up with a transportation funding solution.

A “cash management plan” to deal with the impending shortfall in the Highway Trust Fund — which actually pays for transit, biking, and walking projects in addition to roads — was outlined in a letter from U.S. DOT to state transportation officials yesterday [PDF]. U.S. Transportation Secretary Anthony Foxx wrote that “as we approach insolvency, the Department will be forced to limit payments to manage the reduced levels of cash.”

Federal transportation revenues have been faltering for a long time, primarily because inflation has eaten away at the gas tax, which hasn’t increased in more than 20 years. Congress and the White House have floated many possible solutions of varying merit — a gas tax increase, an excise tax on oil, “business tax reform,” even canceling Saturday mail service. Lacking an agreed-upon revenue source, the Highway Trust Fund has been propped up with general revenues over the last few years. It is unclear whether Congress will extend that stopgap before funding starts to run dry in the next few months.

In his letter, Foxx indicated that if the issue isn’t resolved by August 1, around the time when revenues are expected to dip below current spending levels, U.S. DOT will dole out the available money based on existing funding formulas. In other words, the funding cuts will be shared among all the states, based on population and other factors.

In a speech yesterday in Washington, President Obama urged Congressional action to ward off funding problems, saying inaction would put 700,000 jobs at risk — or about as many people as live in Denver or Boston. He blamed Congressional Republicans for failing to act to resolve the issue.

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House Bill Would Give Cities and Towns More Say Over Transpo Spending

U.S. Representative Rodney Davis (R-IL) introduced the legislation alongside Chris Koos, mayor of Normal, Illinois, introduced the new bill last month. Photo: Transportation for America

U.S. Representative Rodney Davis (R-IL) introduced the legislation alongside Chris Koos, mayor of Normal, Illinois, last month. Photo: Transportation for America

A bill to give local governments greater access to transportation funds has bipartisan sponsors in the House of Representatives.

The Innovation in Surface Transportation Act, introduced late last month, would let local communities access a much more significant share of federal transportation funds. The legislation would set aside a share of various federal programs that flow to state departments of transportation, which would be distributed to cities and towns through a competitive grant process. The amount of funding reserved for local governments would add up to $5.6 billion per year.

Normal, Illinois' up-and-coming Uptown area will receive a boost, thanks to $33 million in federal funding that will help move the Amtrak station to this central location. Photo: Transportation for America

The bustling Uptown area in Normal, Illinois, will receive a boost thanks to $33 million in federal funding that will help move the Amtrak station to this central location. Photo: Transportation for America

The grants would be awarded by a committee of state and local officials, based on nine criteria, including potential to attract private investment and to promote “multimodal connectivity.” (Full text here [PDF].)

Currently, less than 15 percent of federal transportation funds are allocated to localities, according to Transportation for America.

The legislation is sponsored by Congressman Rodney Davis (R-Illinois) and Congresswoman Dina Titus (D-Nevada). Sponsors say the bill will help ensure that increasingly scarce transportation funds are directed toward the highest-priority projects.

“This bill recognizes our nation’s fiscal realities by giving preference to projects that strengthen the return on investment, encouraging public-private partnerships and increasing transparency so that every federal dollar spent goes a little bit further,” said Davis.

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GOP’s Lunatic Plan for Funding Transportation Draws Nothing But Scorn

House Republicans announced on Friday the latest in a long line of hare-brained schemes for funding the Highway Trust Fund, which is projected to become insolvent in August. Their ingenious proposal is to pay for transportation by making cuts at the post office.

You wouldn't be seeing many of these on Saturdays if the GOP transportation funding plan went through. Photo: ##http://en.wikipedia.org/wiki/File:Small_USPS_Truck.jpg##Wikipedia##

What does postal delivery have to do with transportation funding? Nothing, unless you’re a House Republican. Photo: Wikipedia

This idea didn’t come from some Tea Party fringe of the GOP. It came straight from leadership: House Speaker John Boehner, Majority Leader Eric Cantor, and Majority Whip Kevin McCarthy.

In a memo to party members, they called the plan “the best way to ensure continued funding of highway projects in a fiscally responsible manner.” They say they can extend the current transportation bill by one year and offset the cost by reducing Saturday delivery. The proposal would save an estimated $10.7 billion over 10 years. Republicans have chided Democrats for offsetting MAP-21 — a two-year bill — with 10 years’ worth of savings, but now they seem prepared to do it themselves.

The other part of the GOP proposal would transfer funds from the Leaking Underground Storage Tank Trust Fund — also pillaged for MAP-21 — to the HTF. The LUST Trust Fund gets revenue from 0.1 cent of the 18.4-cent federal gas tax, but underground fuel storage tanks must be pretty leakproof lately because the fund is flush with money.

Altogether, the proposal would come up with between $14 and $15 billion to fill the gap between transportation spending and Highway Trust Fund receipts.

For the past few years, the idea of eliminating or reducing Saturday mail delivery has come up a number of times. But under those proposals, the savings would shore up the financially shaky U.S. Postal Service itself, which has lost $41 billion in the last six years — not transportation.

The Senate EPW Committee has unanimously passed a six-year transportation bill, though that committee has no idea how the bill would be paid for and is counting on the Finance Committee to come up with a solution. Just about everyone with a dog in the fight, including the reform coalition, is pushing hard for a long-term bill. A one-year extension, no matter how it’s funded, is a highly unpopular option.

The House GOP’s extension is especially unpopular because of the way it’s funded. Democrats have called it “strange,” “unworkable,” and a ”non-starter.” The mail carriers’ union said the proposal “would begin dismantling the Postal Service” and “wouldn’t even work if tried.” Even the Greeting Card Association has taken a stand, calling the plan “misguided.”

Looks like yet another GOP funding gimmick destined for the dustbin.

Not that Republicans have cornered the market on transportation funding gimmicks, of course.

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The House GOP’s Campaign Strategy: Do Nothing on Transportation

A Senate committee has unanimously approved a transportation bill. Three other Senate committees are holding hearings on the bill. But over in the House? Crickets.

Why is T&I Committee Chair Bill Shuster allowing the transportation bill to get lost in political maneuvering? Photo: ##http://shuster.house.gov/recent-photos/##Office of Bill Shuster##

Why is T&I Committee Chair Bill Shuster allowing the transportation bill to get lost in political maneuvering? Photo: Office of Bill Shuster

At a press conference last week, former transportation secretary — and former House Republican — Ray LaHood scolded his old colleagues for failing to take action.

He said there was “nothing happening in the House” on the transportation bill, The Hill reported.

“Nothing introduced, nothing debated, no discussion and we’re in a mess,” LaHood said. “We really are. The American people get it.”

LaHood is probably right. A few days after those remarks, Adam Snider reported in Politico that members of the House Transportation Committee, from both sides of the aisle, agree that the lame duck is the best — or even the only — time to work on a bill. Snider explained the reasoning:

Congress won’t be able to act on a long-term policy bill that could cost $100 billion in an election year. Next year is a new Congress with new members, making an immediate policy deep dive too difficult. But by the time everybody is up to speed in 2015, the presidential election cycle will be in full swing. And come January 2016, things will start all over with a new president and another new Congress and slate of lawmakers.

“If they try to talk about it now for six years, it will never get done,” said the Republican Snider talked to. “If they get to November and they have the guts to do something in the lame duck, that’s where the opportunity is.”

It’s a baldly political calculus for determining the future of the nation’s transportation systems, but that’s business as usual in Washington.