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Posts about Transportation Reauthorization

Government


Democrats grudgingly approve a transportation extension bill with a risky timeline

On Tuesday, during the one-hour debate period over the House proposal to extend transportation funding through May 31, lawmaker after lawmaker stood up to condemn the bill. America needs a long-term transportation bill, they said. A short-term stopgap only creates more uncertainty.


Rep. Earl Blumenauer was one of just 10 Democrats to reject the House extension. Image from C-SPAN.

And then they voted for it.

More Democrats than Republicans voted for it, in fact, despite standing up and declaring that "a short term solution is not enough" or that it's "just another kick-the-can-down-the-road approach" or that it's just "a little shuffling around of money so we can pretend… we're not creating more debt." But in the end, the Highway and Transportation Funding Act passed easily, with only 10 Democrats and 45 Republicans voting against it.

Peter Welch of Vermont was one of those no-voting Democrats. During the floor debate, he called the bill an "abdication of our responsibility."

"Some folks are saying we need time to put together a long term bill," he said. "We've had time. What we need is a decision."

Earl Blumenauer is in favor of an extension, but only through the lame duck period after the election. He voted no as well, criticizing Republicans for failing to have a "deliberate, thoughtful process."

"We have not had a single hearing on transportation finance in the Ways and Means Committee all year," he said. "We didn't have one the year before that. We haven't had a hearing in the 43 months that the Republicans have been in charge."

How long will the extension be?

The Senate Finance Committee has passed a largely similar bill, with the same amount of money coming out of slightly different funding sources.

Wyden's bill also failed to include an expiration date. Senator Barbara Boxer is expected to introduce an amendment putting a December 31 date on itso that she would still be chair of the EPW Committee when the real bill gets negotiatedbut the juggernaut is already in motion toward a longer extension until May. By putting enough money in the bill to get there, Wyden was tacitly acceding to that timeline without overtly ruffling Boxer's feathers.

Even President Obama has given the green light to the House bill, though he also insisted that "Congress shouldn't pat itself on the back for averting disaster for a few months, kicking the can down the road for a few months, careening from crisis to crisis."

Senate Majority Leader Harry Reid says he plans to schedule three floor votes before the August recess: the House bill, the Senate Finance Committee bill, and Boxer's December 31 plan.

Boxer, of course, doesn't refer to her own hold on the committee when lobbying for a shorter extension. She just says the longer one is "a really bad idea because the longer the patch, the longer the indecision, the more jobs lost, the more businesses go under."

Besides, now that presidential election seasons last for two years (at least), punting until May could easily bleed into much longer delays. After all, if it's too hard to pass a major spending bill in the run-up to a mid-term election, imagine the resistance to passing one during a presidential race.

A bill under a Republican Senate could be much worse

If the Republicans really do take control of the Senate in January, that means that the bill sent to President Obama's desk will be one crafted and approved by Republicans in both houses.

Control of the Environment and Public Works Committee would shift to Louisiana Republican David Vitter, who has a track record of rejecting any revenue increase, railing against merit-based transportation financing, and working to cut environmental reviews for road projects.

The current House Transportation Committee chair, Bill Shuster, has a better track record of consulting with Democrats than his predecessor, John Mica, but with a Republican Senate, even Shuster might be less invested in bipartisanship.

A Congress with both chambers controlled by Republicans could revive old, rejected ideas like devolving transportation funding to states, closing the Highway Trust Fund's transit account, or eliminating bike/ped funding. That is the scenario set up by yesterday's extension vote with its May 31 sunset.

Oh, and if you're impressed that Congress is addressing this issue well before the September 30 expiration of the current MAP-21 bill, don't be. That bill's funding fixesgimmicks in their own rightdidn't manage to last all the way until its sunset, and the highway account of the Highway Trust Fund is expected to dip into insolvency by the end of next month. US DOT was preparing to start cutting payments to states by 28 percent on August 1. And Congress has only 10 work days left on the legislative calendar before members retreat to their home districts for the month of August.

A version of this post originally appeared on Streetsblog. Since it ran yesterday, Senator Mike Lee (R-UT) announced plans to slow the bill unless he can get a vote on two amendments (to devolve funding to states and repeal the Davis-Bacon rules on contractor pay) that do not have bipartisan support.

Government


Why is the Highway Trust Fund going broke (and what can be done about it)?

You may have been hearing some doomsday reports in the media about the impending bankruptcy of the Highway Trust Fund. The US Department of Transportation has a ticker where you can watch the balance drop. What is happening, and why?


Photo by Joe Shlabotnik on Flickr.

What is the Highway Trust Fund?

The Highway Trust Fund (HTF) is basically a bank account that was established by Congress in 1956 to pay for the Interstate Highway System. The HTF is funded through revenues from the federal gas and diesel taxes, and an assortment of other taxes on things like truck tires. The idea was that these taxes are essentially road user fees, and thus should be set aside for transportation.

In 1982 we started the long and painful slog away from the "user fee" concept with the creation of the Mass Transit Account, which funds transit capital projects.

How important funding from the HTF is for transportation infrastructure varies a lot from state to state. In our region, federal funding comprises 86% of transportation capital investment in Virginia, and it's also really important for WMATA, according to the Bipartisan Policy Center.

How much money is in the HTF right now?

The HTF is divided into two main accounts, the Highway Account and the Mass Transit Account. The former has $8.1 billion in it right now and the latter has $2.8 billion.

That sounds like lots of money. Why the wailing and gnashing of teeth?

True, the current balance in the HTF is roughly 80% of what it was last October. That seems far from empty. But we really are about to blow through those billions.

Most programs financed by the HTF are operated on a reimbursement basis. That means that money to pay for projects doesn't go out the door until the project is complete and has been inspected. It's not unusual for states to basically be handing over big piles of receipts at the end of the fiscal year to get paid back. Thus, most of the projected drop has yet to occur.

Also, the summer construction season is just now kicking into high gear. People are freaking out because bids for work are going out the door while a letter from Transportation Secretary Foxx warns that reimbursements may well be delayeda cash flow crisis for states.

Why is this happening if it's possible to predict it in advance?

The HTF is in crisis because it's traditional revenues are no longer sufficient to cover the spending levels Congress authorized for transportation programs. To cope, Congress has been periodically bailing out the trust fund for the last few years using infusions of money from the General Fund (the pot all our income taxes go into).

So this is an artificial crisis? We're creating it by spending more than we have?

Some folks certainly see it that way. Others note our crumbling bridges and burgeoning demand for transit capital projects. Also the current transportation spending authorization, passed in 2012, did not increase spending.

If our transportation spending is reasonable, why can't we find the money to pay for it?

We last raised the gas and diesel taxes in 1993. The CBO estimated last year that if these taxes had been indexed to inflation, the 18.4¢-per-gallon tax on gas would be 29¢ today. Basically, the HTF has lost 38% of its purchasing power to inflation alone.

When people bring up raising the gas tax, smarty-pants folks correctly point out that cars have become more fuel efficient, and even in these more efficient cars people are driving less, so the gas tax is becoming conceptually inefficient or obsolete. Ideologues point out that we spend HTF money on things that encourage people to drive less, and thus pay less into the fund, like transit infrastructure, sidewalks, and bicycle facilities. However, more intellectually pure solutions like road pricing or a tax on vehicle miles traveled are not ready for prime time. So, let's stop changing the subject.

The CBO estimates that raising the two motor fuel taxes by 10¢ would solve the problem without eliminating funding for any current transportation programs. In other words, other issues are marginal compared to the effectiveness of simply adjusting motor fuel taxes for inflation.

A bipartisan proposal to do just that is finally making the rounds after years of General Fund bailouts. However, such a proposal is both a referendum on our economic recovery since 2008 and our sense that we need a federal transportation program. That means it's got a long row to hoe with the Obama administration and tea party conservatives.

What will happen if the HTF empties out while we are waiting for Congress to act?

USDOT will stop writing checks. Stop work orders will go out on projects. Contractors will get laid off. The lights are going to go off in some people's houses.

Because this pain will be very visible, and affect every state, it's likely that Congress will provide a general fund bailout at a minimum for this summer. Just a couple of months ahead on the calendar, however, the current transportation spending authorization will expire at the end of September, another impending crisis that requires Congressional action.

Many professionals in the transportation sector are weary of the constant lurching from one short-term authorization to another, and the de facto endless funding cut that is inflation. However, I'm not convinced that we transportation professionals have fully confronted why many in Congress, or even the general public, might be reluctant to fund our work.

It's not just time to raise the gas taxit's time to increase transparency in transportation planning, truly listen to the public's priorities about transportation, and earn the trust required to justify dedicated revenues. I'll talk more about that in an upcoming post.

Politics


Will Cantor's loss push congressional Republicans to balk on transportation compromise?

Last night, US House majority leader Eric Cantor lost the Republican primary to a tea party challenger who painted Cantor as too willing to compromise with Democrats. Cantor's loss makes this summer's looming congressional fight over transportation funding all the more unpredictable.


US Highway Trust Fund balance. If Congress doesn't act soon, money will run out. Image from USDOT.

MAP-21, the federal transportation funding bill, expires in October. But the US Department of Transportation (USDOT) will begin running out of money in August. Without a bipartisan bill to add new money, federal transportation funding will trickle to a halt.

Transportation wasn't a major issue in Cantor's election, but immigration reform was. Cantor mostly opposed immigration reform, but he briefly contemplated compromise, giving his more conservative opponent David Brat an opening to attack.

Some pundits fear that will push every other House Republican away from compromise in general, and grind whatever progress Congress was making on anything to a halt.

From an immigration perspective that probably makes little difference; House Republicans were not going to compromise anyway. But it could make a huge difference for transportation.

Transportation funding was a non-partisan issue in the 20th Century. Every six years Congress would pass a transportation bill with broad support from both parties. But in recent years, amid declining gas tax revenue and increasing need for supplemental funding, transportation has become a partisan spark.

Congress seemed primed to act, but now it's an open question

Up until Cantor's defeat, the general assumption in the transportation world has been that Congress would do something this summer. "Something" might mean a long term solution like a new bill and new taxes. Or it might mean a band-aid, like an extension of MAP-21 with an infusion of federal general fund dollars. Either way, Congress appeared to be making some progress.

But now? House Republicans might very well cease all legislative activity, and hope to ride out the rest of election season without upsetting their conservative base.

Polls show that raising money for transportation is popular, and voters rarely punish officials for doing so. But that may not matter to Republicans concerned about attacks from the extreme right.

While in Congress, Cantor fought against progressive transportation funding. But in this case his personal vote, and even his leadership on the specifics, might be less important than the simple fact that he was probably willing to advance a bill.

On the other hand, maybe the Republican establishment will take this as a call to arms, and moderate legislators will become more powerful. But that seems unlikely the day after the biggest tea party victory of the season.

Cross-posted at BeyondDC.

Roads


Federal transportation bill clings to the status quo

Congress passed a major transportation bill last week, authorizing more than $100 billion in spending for highways, transit, and other modes over the next 2 years. The bill changes a number of rules and shifts the ways in which money is distributed, in an effort to preserve highway funding.


Photo by Talk Radio News Service on Flickr.

The bill generally maintains the status quo of federal trans­por­tation spending, but attempts to stretch the amount of money available for highways. Transit gets the same amount of money as before, which is not nearly enough for the projects states want to build.

Bicycle and pedestrian programs got consolidated into a single, smaller program, half of which state governments control directly. States uninterested in building sidewalks and bike trails can spend the money on more roads instead.

The bill makes $54.6 billion available per year for the next 2 years. About 80% of funding will go to highways, and about 20% will go to transit. Both the overall funding level and the 80/20 split are comparable to existing allocations.

The gas tax will remain at 18.3¢ per gallon, as it has since 1993 when gas was $1.07. Since this won't produce enough revenue to maintain current spending, almost $20 billion in federal general fund money will be infused into the transportation fund.

Highways

As in every previous federal transportation authorization, the bulk of spending authority goes to highways. Most of the money will be automatically distributed to state Departments of Transportation, which will have the authority to determine spending on roads within their borders.

Little about this system will change, except that a little bit more money is available for highways due to cuts to other modes.

One thing that may change is the make-up of the fleet of cars and trucks using the highways. This bill eliminates the so-called "gas guzzler tax," which raised a small amount of money but provided a disincentive to buying the least efficient cars and SUVs.

Another change is that more funding, up to $1 billion per year, is being directed to the TIFIA program, which offers loans to states and localities for major capital projects, instead of direct grants. TIFIA loan details are more favorable than private market deals, so this is a good option for large projects that don't get grants. Meanwhile, by expanding a program that requires participants to pay it back, the feds stretch limited dollars further.

Transit

At one stage of negotiations, Republicans in Congress sought to eliminate transit funding altogether. That would have been a disaster. Thankfully, it didn't happen.

Much of the transit money flows to transit providers through automatic formulas, similarly to how highway money flows to state DOTs. The largest pot of non-automatic money is in the New Starts program, which is the major federal source for money to build new rapid transit routes.

New Starts is funded at $1.9 billion per year, which is $50 million per year less than the existing allocation.

For that money, the list of project types that are eligible to receive New Starts grants has been broadened, to include more BRT projects, as well as projects that expand the core capacity of existing transit lines. Also, a special category has been established for "demonstration projects" that are primarily funded with local or private money, and only need a little federal funding.

New Starts is extremely important. Virginia received $900 million from it to help build the Silver Line, and Maryland is counting on it to help fund the Purple Line, Corridor Cities Transitway, and Baltimore Red Line. Expanding the list of eligible uses is good, but it further spreads out an already-diminished pot of money.

The competition for New Starts grants will be fierce, and the supply definitely won't meet the demand.

Tax-exempt benefits for transit riders will continue to be capped at $125/month, while drivers can still get corresponding parking benefits of up to $240/month. This is a blatant subsidy for driving over transit use, and is extremely unfortunate.

Some positive news is that there are two new transit programs established in the bill.

The first is a safety program that will institute nationwide safety standards for railcars, and require large transit agencies to establish safety plans. This is a direct outgrowth of WMATA's problems in recent years, especially the June 2009 Metrorail crash.

The second new program will offer planning grants to help communities plan and build Transit Oriented Developments around transit stations, which is a nice win for smart growth.

Bike/ped

Bicycle and pedestrian funding was a major target for attack, and a major point of contention. Many rural and conservative congresspeople don't understand the importance of these modes to urban transportation, and view them as unnecessary luxuries.

At several points throughout the negotiation process, it looked like dedicated bike/ped funding might be eliminated entirely. With the final adopted bill, it was reduced from about $1 billion annually to about $700 million annually. That's too bad, but the fact that any survived at all is good news.

Of that $700 million, half will be distributed via automatic formula to Metropolitan Planning Organizations (MPOs) for use on bike/ped projects. Previously all of this money had been distributed to states, so sending it to metropolitan areas is an interesting change, and could be seen as an experiment in funneling money directly to metropolitan areas instead of through states.

Unfortunately, the other half of the $700 million in bike/ped money will go to state DOTs, who will have the option of either using it for bike/ped projects, or flipping it into their highway funds and using it for road projects. If all the states do this, it will decrease the total amount of federal bike/ped funding to just $350 million.

Although it is not strictly a dedicated bike/ped fund, another pot of money that is often used for bike/ped projects is the Congestion Mitigation and Air Quality program (CMAQ). Capital Bikeshare has largely been funded via CMAQ, so it is a significant program.

The good news is that CMAQ funding levels appear to be level. The bad news is that the list of eligible project types that can use CMAQ funds has been broadened to include a larger variety of road projects.

Environmental issues

Republicans in Congress had wanted to include in the bill funding for the Keystone Pipeline, which would have transported crude oil from Canada to refineries in the US. Democrats opposed it, and the fight was one of the most widely-reported sticking points in the negotiations.

Funding for the pipeline was not included, which was the major Republican concession agreed upon, in response to Democrat concessions regarding bike/ped and transit funding.

However, another aspect of the bill may have even more important and widespread effects.

A rarely-reported provision aimed at streamlining project delivery will eliminate the requirement for federal environmental review for a wide range of projects, including those within existing right-of-way, those that are below certain cost thresholds, and those that replace damaged infrastructure.

Excluding those projects will undoubtedly save millions of dollars, and months or even years of project planning. But it will also eliminate a key step in project review, and reduce the ability of localities to object to undesirable projects imposed on them by states. It is definitely a mixed blessing.

Summary

Just about everyone in the transportation policy world agrees that the current federal funding system isn't working. Costs keep rising, and with the gas tax flat, spending power keeps dropping. Unfortunately, not everyone agrees about what to do.

Some want to find more sustainable revenue sources, and use them to build multimodal 21st century infrastructure. Others want to eliminate multimodal programs and focus on spending limited money on what they see as the most important priority, highways.

This bill is a compromise. It puts off the larger questions of our country's long term needs, and takes a slight regressive lean, in order to continue for 2 more years the overall status quo of an 18.3¢ tax going to an 80/20 highway/transit split.

Cross-posted at BeyondDC.

Government


House GOP would wipe out local control over bike/ped funds

The House GOP couldn't pass a transportation bill of their own, so now they want to undo one of the major bi-partisan achievements in the Senate transportation bill.


Image from Elvert Barnes via the Ped-Bike Information Center.

As part of its counter-offer to the Senate in conference committee negotiations over the transportation bill, the House appears to be proposing the elimination of the Cardin-Cochran amendment, which would allow local jurisdictions to control funds for bike/ped projects.

The House proposal, sent to the Senate yesterday, would would effectively block access to bike/ped funding for many towns, cities, and regions located in states where the department of transportation places a low priority on street safety.

Politico Pro reported that House conferees confirmed that the first part of its counter to the Senate offer would "retain the Transportation Enhancements program's overall structure but would let states opt out." Transportation Enhancements is one of the principal funding mechanisms for bike/ped projects. Neither Politico nor Streetsblog has seen a copy of the couter-offer, so it's unclear exactly how the proposal is framed.

Initially, under the Senate's MAP-21 bill, TE was subsumed under a subset of the Congestion Mitigation and Air Quality Program called "Additional Activities," which states could opt out of entirely. But thanks to a bi-partisan amendment crafted by Mississippi Republican Thad Cochran and Maryland Democrat Ben Cardin, decision-making authority for those funds was devolved from states to local governments, which tend to place a higher priority on active transportation programs.

The House proposal appears to erase that progress.

"By allowing states to opt out of Additional Activities funding, the House counter-offer would prevent local governments from accessing funds for small-scale, local transportation projects," said Mary Lauran Hall, communications coordinator for America Bikes. "It pits state control against local control. We've heard from mayors and local elected officials across the country that they want funding for these projects. It doesn't make sense to take away the tiny portion of transportation dollars that trickle to local governments."

The House is expected to complete its counter-offer over the next few days.

Cross-posted at Streetsblog Capitol Hill.

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