With a multibillion-dollar hole expected to appear in the Highway Trust Fund in August, Transportation Secretary Ray LaHood has boosted his estimate of how much the repair will cost. LaHood has picked up support in the Senate for his proposed legislative vehicle, an 18-month extension of the current highway-transit law, which lapses on Sept. 30. House Transportation and Infrastructure Committee leaders back a different plan, a six-year highway and transit bill, which cleared subcommittee on June 24. Lawmakers, state agencies and construction companies are waiting anxiously to see how the trust-fund remedy will be financed.

Without trust-fund boost, federal payments will be slowed.
Photo: Utah Department of Transportation
Without trust-fund boost, federal payments will be slowed.

In May, administration officials projected the trust fund’s highway account would need $5 billion to $7 billion in August and another $8 billion to $10 billion through fiscal 2010. LaHood now has upped the ante, saying a total of $20 billion is required. At a Senate Environment and Public Works Committee hearing on June 25, LaHood heard support for his proposal. Committee Chairman Barbara Boxer (D-Calif.) said panel members, with maybe one or two exceptions, agreed “that the short-term, 18-month extension is the way to go.” But key senators are not accepting the administration proposal to include policy changes in the stopgap. Boxer said the extension should be “clean as it can be—clean as a whistle.” LaHood said, “I got the message on that.”

In the House, transportation panel Chairman James Oberstar’s (D-Minn.) $500-billion, six-year bill advanced, though it is silent on revenue-raisers. Former DOT Secretary Norman Mineta says Oberstar hopes to have the bill on the floor in the third week of July. “Jim is pushing very, very hard,” Mineta says.

Pennsylvania Gov. Edward Rendell (D) calls Oberstar’s proposal “a terrific bill,” but says current sources fall short of funding it. Rendell says Congress needs to pass “a stopgap using operating funds.” Mineta says the trust fund will require a general-fund infusion, “and not only for fiscal year 2009 but I think for 2010 and 2011 as well.”

If the trust fund is not bolstered, federal payments to state agencies will be slowed. To pay for a “fix,” Sen. David Vitter (R-La.) would tap unobligated American Recovery and Reinvestment Act money. Sen. James Inhofe (R-Okla.) suggests crediting the trust fund for interest on its balance that went to the general fund from 1999 to 2008. The American Road and Transportation Builders Association pegs the lost revenue at $16.8 billion to $22.9 billion.