Skip to Content
Streetsblog USA home
Streetsblog USA home
Log In
Economics

Fiscal Cliff Deal Leaves Big Questions on Transportation

The most significant part of the fiscal cliff deal for transportation was the bump that some transit riders got in the form of a commuter tax break that's now on par with what drivers get. There are two more minor elements in the bill for transportation -- both of them random enough to fit into the Washington Post's list of "weird" provisions in the deal -- but Congress punted on the bigger questions for another two months.

Electric motorcycle enthusiasts got a tax break in the fiscal cliff deal, but there wasn't much else for transportation. Photo: ##http://www.engadget.com/2008/10/24/electric-motorsports-gpr-s-e-motorcycle-available-now-for-8-00/##Engadget##

Here's what they did decide:

Extension of the Railroad Track Maintenance Credit. This provision has been around since 2004 but expired last January. It gives a tax credit to shortline railroads for maintenance work they do on their tracks. The fiscal cliff deal extends this tax credit until next January.

The credit encourages shortline railroads to invest in repair, rather than abandon the lines that serve 11,000 rail shippers in 49 states.

“This bill is not about saving short line railroads,” lobbyist Adam Nordstrom told a trade magazine. "It is about keeping short line railroad customers connected to the national railroad network with adequate and safe rail service, which is why this provision has such broad appeal.”

Extension of Credit For 2- or 3-Wheeled Plug-In Electric Vehicles. This tax credit, which can cover up to 10 percent of the vehicle's cost up to a maximum of $2,500, applies to electric motorcycles but not electric bikes. To qualify, the vehicle has to have a 2.5 kilowatt-hour battery and be capable of speeds higher than 45 miles per hour. Electric bikes top out at about 20 miles an hour by law.

Meanwhile, the fiscal cliff agreement between Congress and the White House postponed the day of reckoning for the "budget sequester" two more months. The cuts in the sequester included an 8 percent reduction in all discretionary spending, which would have taken a bite out of new transit construction and Amtrak funding. The threat of those cuts still hangs over the next round of budget negotiations, which face a March 1 deadline.

At that time, the debt ceiling will need to be raised again and the interim federal budget will be expiring. So don't expect a measured, thoughtful debate over solutions to long-term policy and economic issues. Expect another frenzied bout of negotiations, characterized more by finger-pointing and name-calling than substance, and another punt of some kind.

Stay in touch

Sign up for our free newsletter

More from Streetsblog USA

Monday’s Headlines Pick Up Where They Left Off

Auto designers will have to rethink their approach to pickup trucks in the electric age, according to the BBC.

October 7, 2024

Is Amtrak’s Big Dig Harming West Baltimore’s Black Neighborhoods?

And how should sustainable transportation advocates get involved in the conversation?

October 7, 2024

Friday Video: Why Are America’s Roads and Bridges ‘Crumbling’?

Americas dangerous, crumbling roads are bridges didn't happen by accident — and it's not too late to fix them, the latest Streetcraft video says.

October 4, 2024

Friday’s Headlines Are For Local Control

It's playing out all over the country: A city wants to make a street safer for everyone, only for the state DOT to step in and say no. Learn more about the trend + more stories in today's headlines.

October 4, 2024

Talking Headways Podcast: Transit Themed Rock Music

Meet a band that writes exclusively about the car-free life on public transit. And it rocks!

October 3, 2024
See all posts