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Posts from the "Barack Obama" Category

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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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Is Obama Opposed to the Bipartisan Gas Tax Proposal or Just Noncommittal?

Yesterday, The Huffington Post ran this headline: “White House Appears More Open To A Gas Tax Hike.” Minutes later, The Hill published this one: “White House opposes gas tax hike to fix transportation funding.” So, which is it?

Josh Earnest, on his first day as White House press secretary, said the president "would not support" a gas tax hike. But other officials have softpedaled the question. Photo: ##https://www.facebook.com/topic/White-House-Press-Secretary/108184749201716##Tamara Keith/Facebook##

Josh Earnest, on his first day as White House press secretary, said the president “would not support” a gas tax hike. But other officials have softpedaled the question. Photo: Tamara Keith/Facebook

The Hill’s headline was based on a statement by new White House press secretary Josh Earnest, who said about a gas tax increase: “That’s something that we’ve said a couple of times that we wouldn’t support.” But HuffPo got a different quote, which gave them a different perspective.

“The Administration has not proposed and has no plans to propose an increase in the gas tax,” White House spokesman Matt Lehrich told HuffPo. “It is critical that we pass a bill that not only avoids a short-term funding crisis but provides certainty and lays the groundwork for sustained economic growth. So we appreciate that members on both sides of the aisle continue to recognize the need for a long-term infrastructure bill, and we look forward to continuing to [work] with Congress to get this done.”

HuffPo also reports that Ryan Daniels, a Department of Transportation spokesman, said that while the “Department has outlined a plan involving pro-growth business tax reform,” it was “open to ideas that Congress comes up with.”

Non-committal at best. But, it’s a far cry from Earnest’s claim that the administration “wouldn’t support” a gas tax increase. Earnest made that statement on his first day on the job — perhaps he overstated the case.

President Obama has come out in support of a convoluted plan to close corporate tax loopholes and repatriate some offshore profits as a means of paying for transportation — though such a scheme would upend the “user pays” ethic that has undergirded transportation policy for decades and would only pay for a four-year bill.

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President Obama’s Hollow Push for Infrastructure Investment

With the Tappan Zee Bridge behind him, President Obama made his case for more infrastructure spending. Photo: ##https://twitter.com/TheObamaDiary/status/466676032834387969/photo/1##TheObamaDiary/Twitter##

With an old highway bridge and the cranes building its replacement behind him, President Obama made his case for more infrastructure spending. Photo: TheObamaDiary/Twitter

This afternoon, President Obama stood by New York’s Tappan Zee Bridge and made a speech pressing Congress to do something about infrastructure investment. It’s part of his Infrastructure Week push for Congress to pass a fully funded transportation reauthorization bill. Many other groups are spending this week sounding the same horn.

“If they don’t act by end of summer, federal funding for transportation projects will run out. The cupboard will be bare,” Obama said today. “Nearly 700,000 jobs will be at risk.”

“So far, at least, the Republicans who run this Congress seem to have a different priority,” he said. “Not only have they prevented, so far, efforts to make sure funding is still in place for what we’ve already got, but their proposal would actually cut job-creating grant programs that funded high-priority transportation projects in all 50 states — they’d cut ‘em by about 80 percent.”

Indeed, Obama has submitted a bill to Congress calling to increase federal transportation investment to $302 billion over the next four years. The problem is, his plan to pay for it — using what he calls “pro-growth” business tax reform and the repatriation of offshore profits — is falling on deaf ears in Congress. Advocates criticize the plan as a one-time gimmick, not a long-term funding source.

The most obvious and simple method of raising more revenue in the long run is to increase the gas tax, which hasn’t been raised since 1993 and has lost an estimated 37 percent of its purchasing power. Experts say an increase of 10 to 15 cents per gallon is needed to fill the gap in the nation’s transportation funding.

But the Obama administration has been adamant in its refusal to raise the gas tax. Though former Transportation Secretary Ray LaHood came out in favor of a 10 cent hike almost as soon as he left office, he toed the official line while at U.S. DOT, insisting that a hike was a non-starter. At a Commerce Committee hearing last week, LaHood’s successor, Anthony Foxx, disappointed senators by dodging a question about increasing the gas tax, saying only that he would “listen to Congress.”

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In Obama Budget, a Glimpse of What Beefed-Up Transit Funding Could Do

Nashville BRT is among the transit upgrades in line for funding in 2015. Image: Nashville Public Radio

The budget proposal released by President Obama yesterday fleshes out the transportation ideas put out by the White House last week and includes specific grants for transit upgrades and expansions in 2015, but many of them won’t be part of this budget unless Congress agrees to increase funding for transportation.

The White House budget proposes $17.6 billion for the Federal Transit Administration, an increase of about $7 billion from current levels. This would give transit agencies significantly more resources to rehab existing infrastructure and build rail and bus expansions.

Most of the additional funding — more than $5 billion — would come in the form of bigger distributions to transit agencies by formula. On top of that, money for transit expansion projects would grow by more than $500 million, a new $500 million program would help fund bus rapid transit projects, and $500 million would be set aside for “a new competitive grant program that will encourage innovative solutions to our most pressing transportation challenges.”

Enacting these changes is unlikely, because Obama will have to win Congressional support for funding transportation with corporate tax reform. But a look at the FTA budget provides a sense of how much more can be done for transit each year, given new resources.

The increased funding for transit expansion would go toward light rail in Baltimore, an extension of Boston’s Green Line, and commuter rail in Orlando, among other projects. Portland’s Columbia River Crossing — the sprawl bridge/light rail project that apparently just won’t die – is also on the list.

A round of smaller grants that also need Congressional approval would fund bus rapid transit projects in Nashville, Oakland, El Paso, Eugene, and Vancouver, as well as $50 million to advance Fort Lauderdale’s streetcar plans.

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Inside Obama’s Transpo Budget: “Historic Increase” in Transit Funding

A few more details about the Obama administration’s proposal for a new transportation bill surfaced today when the president unveiled his 2015 budget proposal.

The topline numbers came out last week and look good for transit, biking, and walkability. The White House’s four-year, $302 billion surface transportation plan proposes an “historic increase” in transit funding — from $12.3 billion to $22.3 billion annually. The budget also proposes $600 million in annual TIGER spending, a new program with $4 billion annually to help modernize state departments of transportation, and $19.1 billion for intercity rail spread over the next four years.

The President's budget proposal calls for significant increases in funding for passenger rail. Image: Flickr

The White House budget proposal calls for significant increases in funding for transit. Photo: Trimet/Flickr

While White House transportation proposals have gone nowhere with Obama at odds with House Republicans, there’s a slim chance that the administration and the GOP will align this time over how to pay for the program.

The budget document released today offers more information on the White House’s plan to keep wasteful highway expansion in check. The budget introduces a new program that appears to be aimed at reforming old-fashioned state DOTs. The administration proposes $4 billion annually for a new program it calls “Fixing and Accelerating Surface Transportation,” which is “designed to create incentives for state and local partners to adopt critical reforms.” The administration says this funding would be intended to be spent on “modifying transportation plans to include mass transit, bike, and pedestrian options,” and “peak travel demand management,” such as tolling or congestion pricing programs.

The budget document also promises “a fix-it-first approach for highway and transit grants”:

States and localities have incentives to emphasize new investments over improving the condition of the existing infrastructure. The Administration’s reauthorization proposal will underscore the importance of preserving and improving existing assets.

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Will Obama and the GOP Align on Plan to Fund Transpo With Tax Reform?

Today, both President Obama and Republican House Ways and Means Chair Dave Camp unveiled plans to pay for transportation with corporate tax reform. Few details have emerged about exactly how Camp plans to do this, but Politico has heard from Capitol Hill staffers that it would push $100 billion to $125 billion to transportation over an unspecified time frame.

While the revenue stream is still a mystery and appears to be extremely gimmicky, Obama’s spending plan looks good. It would raise the federal investment in transit by 70 percent annually, and also beef up intercity rail and the TIGER program. The Obama plan also calls for an increase in funding for state DOTs, but an outline released by the White House said “fix-it first” protections would be attached to make sure that this goes primarily toward road maintenance, not highway expansion.

The main talking point of Camp’s plan, meanwhile, is that it cuts the top corporate tax rate from 36 percent to 25 percent. The details of how that is going to shake down into a windfall for transportation are still hazy.

While it would seem to be a good sign that both the Democratic president and Republican Ways and Means chair agree on a mechanism to fund a long-term transportation bill, it’s far from a done deal. Sen. Max Baucus, who was gung-ho about tax reform, has left the Finance Committee and the Senate to become ambassador to China. His replacement, Sen. Ron Wyden of Oregon, is very progressive on transportation but not so keen on tackling tax reform just yet. Insiders say that even House Republicans may be hesitant to embrace Camp’s tax reform plan when it has so little chance of going anywhere in the Senate.

Meanwhile, Obama just announced his plan at an event at St. Paul’s Union Depot, where DOT Secretary Anthony Foxx also announced the sixth round of TIGER funding, for $600 million.

Obama’s proposal is progressive and thoughtful — as are all of the transportation proposals he’s put forward in the past five years, all of which have gone nowhere. This plan tacitly acknowledges some of those failures: It renamed the High-Speed and Intercity Passenger Rail Program (which has been belittled for not being high-speed enough) “high performance and passenger rail programs.” Instead of more ambitious Obama priorities such as a National Infrastructure Bank, it leaves funding for the TIFIA loan program at $1 billion a year, where Congress set it in MAP-21.

The president says corporate tax reform would yield $150 billion for a one-time infusion into the Highway Trust Fund — twice what’s needed to ward off insolvency — to help fund his four-year, $302 billion plan. Though the size of the infusion is good news, it gives advocates pause. It’s still a one-time fix and not a real solution to the mismatch between transportation revenues and transportation needs. It totally severs the relationship between the revenue source for transportation investment and what the revenue is spent on.

And it’s all because practically no one on Capitol Hill is willing to call for anything that could possibly sound like a tax increase, even as the economy rebounds.

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Live-Blogging Obama’s Transportation Announcement

obama3:59 p.m.: Obama says funding for these projects is going to be in jeopardy unless Congress passes a new transportation bill. Doesn’t go into details. “God Bless the United States of America,” and we’re out.

3:56 p.m.: People go wild for new Metro green line, which will run through Union Depot. Obama says he just got a look at those “spiffy new trains.” “You’ll be able to get from one end of town to another in 30 minutes. And here’s the best part: Not only have you made a more efficient transportation system… this Depot has also helped to boost economic development. Just across the street, the old post office building is becoming apartments and shops.”

3:54 p.m.: Obama: Infrastructure shouldn’t be a partisan issue. But some Republicans in Congress — it’s not that they don’t like roads; they just don’t want to pay for ‘em. “While Congress is trying to decide what to do next, I’m going to do what I can to create good jobs. And that’s why I came to St. Paul. Because [Union Depot] symbolizes what’s possible.”

3:53 p.m.: Obama: I’m going to send Congress a budget with a four-year transportation budget to pay for investments by simplifying tax codes.

3:49 p.m.: Obama: Put America back to work by repairing America’s infrastructure. Housing bubble burst, construction workers were hit hard. Unemployment in that sector has been cut in half but still too high. 100,000 bridges old enough to qualify for Medicare. Minnesota winters mean potholes.

3:48 p.m.: “We can’t wait. We gotta move.” Obama reiterating new plan to bypass Congress where they move too slow.

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Obama to Propose Four-Year Transpo Bill Funded By “Business Tax Reform”

President Obama will unveil a proposal for a $302 billion, four-year transportation bill during a speech today in Minnesota, according to an announcement from the White House. A fact sheet from the administration indicates the proposal would increase dedicated funding for transit more than funding for highways.

Obama will appear in St. Paul, Minnesota today to announce a new transportation plan he says is part of his "year of action." Photo: PRX.org

Obama will appear in St. Paul, Minnesota today to announce a new transportation plan. Photo: PRX.org

The proposal would represent a 38 percent spending increase over the current $109 billion, 2-year law, known as MAP-21, and is the most concrete long-term transportation bill proposed by the Obama administration, which has never put forward a funding stream until now.

The $300 billion spending plan does not raise the gas tax. Instead, it calls for directing some $150 billion from “business tax reform” to help shore up the Highway Trust Fund, which is set to go broke late this summer. The White House has not released more information about how the funding stream would operate, but the press release calls it ”one-time transition revenue,” so the idea seems to be that in four years, a different revenue stream would have to be identified.

The White House announcement said Obama’s proposal “will show how we can invest in the things we need to grow and create jobs by closing unfair tax loopholes, lowering tax rates, and making the system more fair.”

Such a funding method would represent a major break from relying on the gas tax to pay for the national transportation program. The gas tax hasn’t been raised in two decades, and inflation and rising fuel efficiency have eroded its value. In 2012, the federal gasoline tax brought in $35 billion, but the feds allocated $54 billion in transportation spending, with other sources, including general tax revenues, making up the difference.

Obama will also announce the upcoming $600 million round of funding for TIGER, US DOT’s popular competitive grant program for local transportation projects, which has already been approved by Congress. The program has funded $1 billion in city transit projects, nearly as much for intercity rail, and $153 million in biking and walking projects since it was introduced in 2009.

More details about the president’s “vision for a 21st century transportation infrastructure” will be available after the speech today in St. Paul, which will take place inside the city’s restored Union Depot train station.

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Will Obama’s SOTU Pledge to Flex Executive Power Extend to Transpo?

Maybe it doesn’t matter what President Obama says in his State of the Union. According to a Washington Post analysis, his batting average for last year’s SOTU proposals was a .208. In 2013, the president pleaded for tax reform, an American Jobs Act, $50 billion for a Fix-It-First infrastructure repair binge, a “Partnership to Rebuild America” to lure private capital to infrastructure projects, and an Energy Security Trust to use oil and gas revenues for technology to “shift our cars and trucks off oil for good.” None of that went anywhere.

In last night's State of the Union speech, President Barack Obama indicated he'll bypass Congress to get things done. Do those things include transportation? Photo: ##http://www.whitehouse.gov/state-of-the-union-2013## the White House##

In last night’s State of the Union speech, President Barack Obama indicated he’ll bypass Congress to get things done. Do those things include transportation? Photo: The White House

But this year, perhaps Obama’s most significant promise was to flex his executive muscle and stop waiting around for Congress. “America does not stand still, and neither will I,” he said. “So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that’s what I’m going to do.” Going it alone, Obama has a much better shot at fulfilling his priorities.

Streamlining

The only transportation-related promise Obama made that he can accomplish with his own executive power is to continue streamlining environmental review and permitting for key projects. While you may get your back up when politicians talk about streamlining environmental review — some call it “steamrolling” — executive action on this front is more short-term and more tactical than across-the-board legislation. By picking specific projects, the administration has been able to shepherd them through the process.

House Transportation Committee Chair Bill Shuster seems to have forgotten that initiative. In a statement this morning, Shuster said the president has been talking about streamlining for two years “but we are still waiting for action.”

Other administration initiatives, like the partnership between U.S. DOT, HUD and the EPA, happen without the need for Congressional approval.

But if Obama wants to take his promise to use the full extent of his executive power seriously, there’s more his administration can do.

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Obama’s Climate Speech: Mostly Mum on Transportation

President Obama announced a sweeping package of measures to address climate change today. But with a couple of exceptions, he was largely silent on the 27 percent of carbon emissions that come from the transportation sector.

President Obama outlined his new Climate Action Plan in a speech today at Georgetown. But the president's actions to address climate change are hindered by Congressional resistance. Image: Whitehouse.gov

One of the most important reforms the president announced is presidential memorandum he plans to issue to the EPA to develop carbon standards for power plants. Carbon emissions from these sources, unlike other harmful chemicals, have until this point gone unregulated by the federal government.

“Today about 40 percent of America’s carbon pollution comes from our power plants,” said the president, speaking at Georgetown. “Right now there are no limits to the amount of carbon pollutions those plants can dump into the air. None.”

“We’ve got to fix that,” he said.

Obama’s Climate Action Plan establishes a goal of doubling the amount of energy derived from renewable sources by 2020. The plan would also establish efficiency standards for appliances and federal buildings.

The most substantive portion of the plan related to transportation was the announcement that the president wants to expand new fuel efficiency standards for trucks and heavy vehicles beyond 2018. Those standards, the White House says, are projected to save about 270 million metric tons of carbon and 530 million barrels of oil.

The plan also calls for the elimination of “fossil fuel subsidies” in 2014, which would require Congressional cooperation. Research by the International Energy Agency has shown that eliminating those subsidies alone would reduce carbon emissions 10 percent by 2050, according to the Climate Action Plan.

In his speech, President Obama also made reference to the Keystone Pipeline, saying the State Department has been instructed not to approve the project if government analyses determine it would increase carbon emissions.

Jesse Prentice-Dunn, a policy analyst with the Sierra Club, says the Climate Action Plan is mostly a collection of policy fixes the president can enact without Congressional support — such as new emissions standards — which might explain why transportation got short shrift.

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