February 18, 2011
Administration Proposes $556 Billion for <br>Surface Transportation Over 6 Years
President Barack Obama released his Fiscal Year 2012 budget request to Congress on Monday, calling for investing $556 billion in highway, transit, and rail projects over the next six years. The administration's proposal, more than two years after it took office and nearly 17 months since the last surface transportation authorization law known as "SAFETEA-LU" expired, is even larger than a $500 billion package proposed by the House Highways and Transit Subcommittee in July 2009.
"If we want businesses to open shop and hire our families, friends, and neighbors, we have to invest in our roadways, railways, and runways," U.S. Transportation Secretary Ray LaHood wrote on his blog. "We have to invest in 21st century buses, streetcars, and transit systems. We have to invest in NextGen for our skies -- and in sidewalks and bike paths that make our streets safer for everyone who uses them."
The American Association of State Highway and Transportation Officials has urged Congress and the administration to act quickly on enacting a robust multiyear surface transportation reauthorization measure.
"We are pleased that the president's budget recognizes the need for significant investment levels for surface transportation," said AASHTO Executive Director John Horsley. "AASHTO is ready to work with members of Congress and the administration to approve necessary reforms and to set sensible funding levels."
Obama's budget reiterates the president's previous call to frontload a six-year reauthorization measure with $50 billion of extra transportation investment during the first year. Obama first proposed the $50 billion jumpstart during a Labor Day speech in Milwaukee. (see Sept. 10 AASHTO Journal story) In total, the administration is seeking $129 billion for surface transportation in Fiscal Year 2012.
The administration's proposal would authorize two-thirds more surface transportation funding over the next six years than SAFETEA-LU provided through 2009. It would require an additional $231 billion during the six-year period compared to existing estimated revenue, however the budget proposal does not identify where that money should come from. Since taking office in January 2009, Obama's team has consistently expressed opposition to increasing the federal gasoline and diesel taxes due to tough economic times even though those taxes have not been increased or adjusted for inflation since 1993.
"These estimates are a placeholder and do not assume an increase in gas taxes or any specific proposal to offset surface transportation spending," the budget document states. "Rather, they are intended to initiate a discussion about how the administration and Congress could work together on a bipartisan basis to pass a surface transportation reauthorization that is both financially sustainable and meets critical national needs."
The Highway Trust Fund would become the "Transportation Trust Fund" under Obama's budget blueprint. It would add separate accounts for high-speed rail and a national infrastructure bank. Currently the Highway Trust Fund contains only two accounts: one for highway infrastructure and the other for transit infrastructure.
Top Democrats on the House and Senate committees that will write the six-year surface transportation reauthorization measure issued statements endorsing Obama's budget.
"I strongly support the president's plan to invest $556 billion in America's future to create jobs in the U.S., build a transportation system for the 21st century, and keep our economy on the road to recovery," said Rep. Nick Rahall, D-West Virginia and ranking minority member of the House Transportation and Infrastructure Committee. "By infusing an additional $50 billion upfront, we can jumpstart the creation of hundreds of thousands of good-paying American jobs right away while making long-term transportation investments that are critical for enabling private-sector growth."
Rahall hosted a House T&I Committee field hearing in Beckley, West Virginia, on Monday regarding future transportation needs. A listening session also occurred Monday in Charleston, West Virginia. (see related story)
A joint House/Senate transportation field hearing is scheduled for Wednesday, Feb. 23, in Los Angeles.
"I commend the president for his investment in transportation, which will create and save millions of jobs and ensure that our country can compete," said Senate Environment and Public Works Committee Chairwoman Barbara Boxer, D-California. "I've already begun reaching across the aisle to build support for a robust surface transportation bill that will accelerate our economic recovery and build the foundation for long-term prosperity."
Republicans have not embraced the president's vision for increased investment in areas such as infrastructure, however. The House of Representatives has been debating this week an appropriations measure to fund the federal government from March 4 to Sept 30. The bill proposes spending $100 billion less across all government agencies for Fiscal Year 2011 than Obama had requested in the budget submission he made a year ago. (see related story)
Administration Seeks to Consolidate Programs, Boost Rail Funding
The White House's budget seeks to consolidate 55 U.S. Department of Transportation programs into five and to create a new livability grant program that would receive $28 billion over six years.
Obama's request includes $30 billion over six years to create a national infrastructure bank and $53 billion for high-speed rail. (House Republicans are seeking to cut high-speed rail funding for the rest of this fiscal year.)
Reaction from transportation stakeholders has been mixed. While many applauded the large investment level the president proposed, some interest groups have expressed concern at provisions of the reauthorization plan.
Stephen Sandherr, CEO of the Associated General Contractors of America, expressed opposition to restructuring the Highway Trust Fund and disappointment that the administration avoided identifying specific revenue raisers to cover the full cost of the $556 billion six-year reauthorization request.
"It is hard to take this proposal seriously when the administration has yet to identify how it will pay for the other programs it wants to add to the trust fund," Sandherr said in a statement issued Monday. "This portion of the proposal appears more like an effort to obscure overall spending levels than to actually create a viable new role for the trust fund."
Obama's budget includes $336 billion over six years for the Federal Highway Administration. That would be 43% greater than current highway funding levels. The Federal Transit Administration would receive $119 billion over six years -- a 127% increase over the current authorization level, reflecting the administration's strong support for mass transit.
The administration seeks to create a $32 billion Transportation Leadership Awards grant program over six years, which would offer competitive grants for transportation improvements similar to the existing Transportation Investment Generating Economic Recovery initiative.
Available from the White House are a six-page summary of the USDOT FY 2012 budget proposal at bit.ly/USDOTFY12 and the full 94-page detail of USDOT's budget request at bit.ly/USDOTFY12full. USDOT has made available a 52-page documenting highlighting its proposal at bit.ly/USDOTFY12highlights.
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