Congress Fails to Extend SAFETEA-LU before CR Expires

Kerry Clines

November 4, 2009

Efforts in the Senate to consider a six-month extension of the surface transportation law by unanimous consent stalled last week when several senators objected. According to the National Stone, Sand & Gravel Association’s eDigest & Washington Watch newsletter, the failure of the Senate to act made a compromise with the House on an extension impossible. Instead, an extension of the highway program until Dec. 18 was piggybacked on a continuing funding resolution which became necessary because Congress has not yet passed all the FY ’10 spending bill. 

There is a possibility that the Senate could act on a six-month extension this week if it disposes of legislation extending unemployment compensation and if the health care reform bill is not yet ready for consideration. Senate Majority Leader Harry Reid (D-Nev.) could choose to move the Senate bill through the cloture process. This could involve as many as three cloture votes to overcome objections to the extension. The 60 votes do not seem to be the problem, time constraints appear to be the controlling issue. If the process takes too long, it could get bumped by health care reform.

The Senate extension differs from the House three-month extension in several ways:
• The House bill provides one-fourth of FY ’09 contract authority levels for Highway Trust Fund programs through Dec. 31; the Senate amendment would provide 7/12ths of the FY ’09 contract authority levels through April 30.
• The Senate amendment would address the SAFETEA-LU rescission by adding an extra $8.7 billion in contract authority for FY ’10 only to restore amounts rescinded on Sept.30. The House bill includes no such provision.
• The House bill would restore prorated amounts of FY ’09 funding level by state in the major earmarked SAFETEA-LU accounts as formula money for those states, except for the Projects of National and Regional Significance  and Corridor programs, which the House bill would turn into discretionary programs. The Senate proposal treats all of the earmarked accounts equally, as formula money. 
• The Senate amendment would extend the budget firewalls by a pro-rated amount based on the duration of the bill, like the House. 

According to the NSSGA, for Congress to act before the end of the year on a multi-year authorization is possible, but very unlikely, therefore, the association and its coalition partners support the Senate six-month extension proposal. 

There is increasing talk on the Hill of “front- loading” a six-year bill, the newsletter reports. Sen. Richard Durbin (D-Ill.) talked about the importance of acting on a surface transportation reauthorization last week and mentioned front-loading the first two years of a six-year bill.  This implies funding two years  out of general funds and the last four years from the Highway Trust Fund, deferring decisions on how to pay for it until later.

Rep. Earl Blumenauer (D-Ore.) floated a similar idea in a meeting with stakeholders last week.  His idea is to create a Federal Infrastructure Financing Bank under the purview of the U.S. Department of Treasury. The Treasury would capitalize the bank by acquiring a sufficient amount of bank stock, the proceeds of which would finance two years of the transportation authorization. The idea has no immediate funding source, but it would require that, no later than July 1, 2011, the president submit to Congress legislation to provide permanent financing for transportation and other infrastructure projects sufficient to repay the Treasury. The initial funding would come from the General Fund, which means the budget firewalls would go away.

Even House Transportation & Infrastructure Chairman Jim Oberstar (D-Minn.) is talking about front-loading a bill with the intent to create as many jobs as possible between now and the 2010 elections and at the same time getting as many policy changes as possible enacted in his six-year bill, delaying the tough financing decisions until after the elections. Initial funding could come from general fund appropriations or general fund bailouts of the Highway Trust Fund. 

According to the NSSGA, what seems most likely is that the Senate and House, hopefully sooner rather than later, will agree to a six-month extension and then discuss the idea of a front-loaded six year bill after the first of next year.

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