Senate Majority Leader Harry Reid (D-Nev.) on Feb.11 proposed a slimmed-down jobs bill that includes two infrastructure provisions, but is much less generous to public works than the $154-billion version that the House approved in December.
Reid said the measure, which he offered on the floor as an amendment, would be limited to four major elements of a much larger, $90-billion jobs measure that Finance Committee leaders had unveiled earlier on Feb. 11.
A procedural vote on Reid's amendment was scheduled for Feb. 22, when lawmakers return after a week-long recess.
In a provision of direct interest to construction, Reid's initial Senate bill would extend the Highway Trust Fund through December 2010. It also would plug the fund's recurring financial hole by transferring $19.5 billion to the trust fund from the government's general fund. The House version, the Jobs for Main Street bill, has a similar provision.
If the highway program authorization is not extended, it will lapse on Feb. 28.
Reid's bill also would reverse an $8.7-billion rescission of unobligated highway contract authority that was rescinded when SAFETEA-LU expired Sept. 30.
The House-passed bill includes $47 billion in additional spending on highways and other infrastructure programs but the new Senate bill includes no new public-works appropriations.
Another construction-specific provision in Reid's Senate proposal would allow states and localities to finance school and energy projects by issuing Build America Bonds--a financial instrument established by the American Recovery and Reinvestment Act--instead of tax-credit bonds.
Build America Bonds give states and localities a direct federal subsidy that equals 45% of the issuer's borrowing cost. Tax-credit bonds give the bondholders a federal tax credit in lieu of interest payments.
Construction also could take advantage of two other provisions of the
Reid bill that apply to business broadly. One proposal would provide an exemption from the FICA payroll tax for companies for each unemployed worker whom they hire. The break would equal 6.2% of each new hire's wages, up to the the FICA wage limit of $106,800.
For a company to gain the exemption, each newly hired worker would have to have been unemployed for at least 60 days. Companies could gain a bonus credit of $1,000 for every worker who stays on their payroll for 52 weeks.
in addition, the Reid measure would extend the "Section 179" depreciation break for purchases of new capital equipment through 2010. It would allow companies to write off up to $250,000 of such purchases, with a phase-out when a company's total capital purchases exceed $800,000.
The initial Senate bill is envisioned as the first of several jobs measures. Democrats have said they would like to see additional public-works spending in those follow-on jobs bills.
The larger draft measure, drawn up by Senate Finance Chairman Max Baucus (D-Mont.) and the committee's top Republican, Charles Grassley of Iowa, includes those four initial provisions but also others, such as a package of extensions of expired or expiring tax breaks, for research and development, renewable energy and energy efficiency.