Racing against a July 31 deadline, congressional lawmakers have wrapped up yet another short-term measure to keep federal highway and transit funds flowing, this time just until late October.
With only a day to spare, the Senate, by a 91-4 vote, passed a three-month $8-billion surface transportation extension on July 30. President Obama signed the measure the following day. The House had approved the stopgap on July 29.
If the extension hadn't been enacted by July 31, the Dept. of Transportation would have furloughed workers and been unable to obligate highway funds. Without the stopgap's $8-billion in new revenue, the weakening Highway Trust Fund faced a deficit in its highway account in August.
Shortly before the Senate cleared the short-term measure—the latest in a long series of stopgaps—it also put a much more ambitious plan on the table, passing a $350-billion, six-year highway-transit bill on a 65-34 vote.
Construction industry and state highway officials now are looking to the House to produce its version of a multi-year bill. House Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.) said in a statement that the stopgap will give the House "time to put forward a fiscally responsible long-term surface transportation proposal when Congress returns and then go to conference with the Senate."
In the days leading up to the Senate's vote on its voluminous six-year bill, the Developing a Reliable and Innovative Vision for the Economy Act, or DRIVE, its sponsors made changes in the text. To win support, they shifted more money to transit and dropped a few revenue-raising mechanisms. The Senate also added language to reinstate the Export-Import Bank’s authority to approve new loans.
State highway agencies and design and construction firms that rely on road projects have struggled through more than 30 short extensions in the past several years. Some states have cut back on projects because of the stop-and-start federal aid.
Construction and state officials wanted Congress to act to avoid cutting off aid. But their true goal has been a long-term bill, and they were pleased to see the Senate finish its six-year proposal. “The [Senate bill’s] most attractive element is the fact that we do get some long-term certainty in this program that so desperately needs it,” says Jeff Shoaf, Associated General Contractors senior executive director for government affairs.
Michael Johnson, chief executive of the National Stone, Sand & Gravel Association, says a long-term bill is crucial. It would allow “the states … to plan and get the kind of projects in the works that will allow us to make up for some of the ground we’ve lost to the rest of the world in being able to have a surface-transportation system that will help us compete economically with those [other countries] that are investing more and doing more right now.”
The Congressional Budget Office estimates DRIVE’s six-year contract authority at $350 billion, which includes about $274 billion for highways and $49 billion for transit. But the bill guarantees enough actual funds for only its first three years.
Shoaf and others in industry are concerned that DRIVE isn’t fully funded. “But it’s the beginning of the process,” Shoaf adds. “It doesn’t meet the long-term needs that are out there, but … the DRIVE Act was written in a way to get us current funding plus some growth.”
Construction groups hope that if DRIVE—or something like it—becomes law, Congress will include in it the additional $51 billion that CBO says is needed to fund the measure through 2021.
Majority Leader Mitch McConnell (R-Ky.) and Barbara Boxer (Calif.), the Environment and Public Works Committee’s top Democrat, negotiated the DRIVE version that came to the floor. They made changes in the bill to mollify colleagues who had problems with some provisions.
Transit advocates convinced McConnell and Boxer to hike aid for public transportation. Sen. Sherrod Brown (D-Ohio) and his allies were able to get transit’s share of the bill’s $3.4 billion in new revenue bumped up to $815 million, from $200 million in the original version, Brown’s office said.
But altering DRIVE’s allocations was a zero-sum game: Transit’s boost required cuts elsewhere. McConnell and Boxer sliced the Transportation Infrastructure Finance and Innovation Act (TIFIA) loan program by $50 million a year, to an annual $450 million. They also trimmed a new major-projects program by $50 million annually.
After senators objected to certain revenue-generating “pay-fors,” McConnell and Boxer deleted a few and further cut spending to keep the bill’s cost within their revenue limits. TIFIA took another hit, leaving it with $300 million a year. That’s far below TIFIA’s 2015 level of $1 billion.
In another change, the Senate on July 27 passed an amendment renewing the Ex-Im Bank charter for five years, a move that the Association of Equipment Manufacturers and other business groups supported. The bank’s authority lapsed on June 30, barring it from signing off on new loans.
Observers assumed all along that a stopgap would be needed by July 31, says Steve Hall, American Council of Engineering Companies vice president for government affairs. The open question, he adds, was how long the extension would be.
The House on July 15 had approved a five-month stopgap but it later switched to the more abbreviated, three-month alternative.
Jay Hansen, National Asphalt Pavement Association executive vice president, says the Senate's approval of the DRIVE bill could have another effect. He says, “That will then put pressure on the House to take up their [long-term] legislation in the fall.”
Boxer told reporters after the July 30 votes that House leaders, in shortening their extension, "shows they certainly did move our way," and signalled that they recognized the importance of producing a multi-year measure.
ACEC's Hall says, “I think the House is going to want to go to the table with a real reauthorization bill.”