By Tanner Horton-Jones

On Friday, March 30th, 2012, President Obama signed the Surface Transportation Extension Act of 2012 (H.R. 4281), a 90-day extension of existing transportation funding legislation. What makes this extraordinary is that this is the ninth extension of SAFETEA-LU, the transportation authorization bill passed in 2005 and originally set to expire in 2009. Historically, Congress is expected to develop and pass comprehensive multiyear transportation program authorization plans every four to six years. Since 2009, however, Congress as a whole has been unable to agree on a new long-term plan. Instead, Congress has been passing short-term extensions like H.R. 4281 to keep existing programs alive, without providing new long term direction or updating transportation programs to reflect economic and demographic changes since 2005. As the most recent extension neared its expiration date of March 31, 2012, each chamber developed its own approach to a new long-term authorization; the Senate passed its 2-year bill on March 14, while the House debated but could not pass its own 5-year version. As the March 31 deadline loomed, rather than considering the Senate’s bill, the House voted to buy itself another 90 days by passing H.R. 4281 and essentially forcing the Senate and White House to consent to the extension or face a shutdown of transportation programs. This leaves the nation with its ninth extension of a seven year-old policy and the prospect of another budget showdown when the new extension expires on June 30, 2012.

Such a showdown would bring renewed uncertainty to an industry in want of reassurance: if the extension lapses without new legislation—whether long-term or short-term—then federally funded construction projects will halt and associated jobs may be threatened. Furthermore, the Highway Trust Fund—a key source of financing for federally-backed state and local transportation projects, that is dependent on the 18.4 cent-per-gallon gas tax authorized by SAFETEA-LU and its extensions—will be threatened; the Congressional Budget Office has estimated that without change, the fund will be insolvent by 2014. But even though an extension avoids a shutdown, existing problems with the aging SAFETEA-LU remain unaddressed. Transportation stakeholders will be watching closely in the coming months to see whether Congress, particularly the House, can devise a long-term bill that garners the necessary votes to bring a few years of certainty to the nation’s transportation industry.

The Senate’s effort at a new longer-term bill, S. 1813—passed through that chamber March 14th but never advanced in the House—would authorize $109 billion for transportation programs over two years. The bill was introduced by Senators Barbara Boxer (D-CA) and Jim Inhofe (R-OK), and passed with the bipartisan support of 50 Democrats, 22 Republicans, and both independents. The bill, entitled Moving Ahead for Progress in the 21st Century (“MAP-21”), would maintain current funding levels for highway, transit, and safety programs, while utilizing offsets (reallocations of portions of other trust funds or revenue programs) to preserve the Highway Trust Fund. The bill’s proponents argue that it would bring efficiency to federal highway and transit programs through consolidating programs, cutting down duplicative steps in the federal approval process, establishing better safety programs, and eliminating earmarks. By avoiding increases over existing funding levels while advancing modest improvements in the way federal transportation contracts are awarded, the bill was able to garner bipartisan support in the Senate, even if not in the House.

The unsuccessful House bill, H.R. 7, would have authorized $260 billion over five years. H.R. 7, introduced by Representatives John Mica (R-FL) and John Duncan, Jr. (R-TN), was entitled the American Energy and Infrastructure Jobs Act. The key difference between this bill and the Senate version is that the House bill would have promoted the use of tolls and public-private partnerships to fund local projects. The bill failed to attract a majority of Republicans who worried that the authorization would result in more spending than the revenues it would generate. One commentator suggested that this lack of support was really due to the ban on earmarks—none of the proposed bills are permitted to contain these designations for specific projects benefiting individual legislators’ districts. By comparison, the 2005 legislation had more than 6,300 earmarks. Without earmarks to sweeten the pot for today’s spending-averse representatives, it seems even a transportation bill touted for shrinking government bureaucracy will be hard pressed to win support.

Meanwhile, in lieu of either chamber’s long-term plan, the newly-enacted Surface Transportation Extension Act of 2012, like other extensions before it, continues the same programs and funding levels authorized nearly seven years ago in the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (“SAFETEA-LU”). The Extension Act achieves its end largely by replacing budget and timeline language with proportionally higher figures; for example, a $1 million authorization over six months would become a $1.5 million authorization over nine months. While this temporary approach is preferable to a shutdown of federal transportation programs, it falls short of substantive revision of SAFETEA-LU that would address that act’s acknowledged shortcomings. Revenues from the gas tax SAFETEA-LU authorized fall short of what is needed to keep the Highway Trust Fund solvent. More than 50 percent of the nation’s roads are in disrepair, according to MAP-21’s proponents in the Senate, and more than 70,000 bridges are structurally deficient. Authorization bills of this sort are designed to be replaced by updated legislation. The transportation needs of America in 2012 are significantly different from those of 2009 and have evolved in ways that the 2005 legislation was not designed to provide for.

House Speaker John Boehner (R-OH) has stated that the House will take up a long-term transportation bill after the recess, but commentators point out that if existing partisan impasses persist, there will be little hope of moving the necessary legislation through committee and floor votes before the standing extension sunsets on June 30. With H.R. 7, the American Energy and Infrastructure Jobs Act, seemingly a lost cause, the House will have to consider the Senate bill or come up with something new if it wants to avoid another extension showdown. The Senate bill itself arguably falls short of a comprehensive long-term transportation plan, since it essentially will require new legislation a mere two years from now. It also lacks the aggressive spending reductions that conservative representatives demand. But if the House cannot agree to the Senate bill and another extension is enacted, it seems likely this issue will be added to the agenda for the lame duck session after the November elections. The chances of a long-term transportation bill making it out of that session are uncertain. In the meantime, watch out for potholes.



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