As a Highway Trust Fund shortfall looms within weeks, Senate Finance Committee Chairman Max Baucus (D-Mont.) has proposed a remedy. Baucus introduced a bill on July 20 to inject $26.8 billion of new revenue into the trust fund. Of that total, $22 billion would go to the fund’s highway account and $4.8 billion to its transit account.
Dept. of Transportation Secretary Ray LaHood has said the highway account needs a $20-billion infusion over the next 18 months, or DOT would have to slow reimbursements to states for highway-construction spending commitments they incur. LaHood has said the gap will start to appear in August.
Baucus’s funding “fix” draws on two revenue moves. He would reimburse the trust fund for $19.5 billion in interest foregone since 1998, when Congress shifted that interest revenue to the general fund. Of the $19.5 billion, the highway account would get $14.7 billion and the transit account $4.8 billion.
Baucus also would credit the highway account for $7.3 billion disbursed between 1989 and 2004 for emergency highway repairs after storms or other disasters.
If the Finance Committee clears Baucus’s bill, the measure would be merged with an 18-month highway-program extension that the Environment and Public Works Committee approved July 15. The extension would begin on Sept. 30, when the Safe, Accountable, Flexible, Efficient Transportation Equity Act: a Legacy for Users expires.
But House Transportation and Infrastructure Committee Chairman James Oberstar (D-Minn.) opposes an extension and is pushing a $500-billion, six-year highway-transit-rail reauthorization. LaHood backs an 18-month stopgap, saying it would provide “a little breathing room” for Congress to work on a new, multiyear bill.