Congress Passes Last-Minute Extension of Highway Bill

Two-year transportation bill expected to be passed in House in mid-to late-Spring.

Within a three-hour span, both the House and the Senate passed a stopgap bill Thursday that will continue federal highway and transit funding for the next 90 days. Prior to the bill’s passage, Democrats in the House and Senate expressed opposition to doing another extension, pushing instead for the House to vote on the two-year bill passed by the Senate that would have required additional general revenues to fill some of the unfunded $12 billion gap between gas tax revenues and spending in the bill.

The Senate passed the surface transportation bill March 14 by a 74-22 majority - a significant margin given how divisive Washington, D.C. has become.

The House Transportation & Infrastructure (T&I) Committee reported a five-year reauthorization bill out of committee in February, but has been unable to secure sufficient support to pass the full House. The Senate-passed bill and the House T&I Committee bill both contain extensions of the agricultural industry supported hours-of-service exemption for agriculture and a maritime provision expressing a "sense of Congress" that all funds collected for harbor maintenance be fully appropriated for that purpose.

Mike Steenhoek, executive director of the Soybean Transportation Council, said, “The ball is in the House’s court. I would be very surprised if the House doesn’t pass the Senate version or something very similar to it,” adding the House is unlikely to see this bill as one worthy of obstructionism or a battle the House members want to fight. The President has signaled that he would sign the Senate version if it reaches his desk.

Steenhoek noted that the House likely will pass the legislation sooner, rather than later. “By mid- to late-spring, the election will suck the remaining oxygen out of the room. I could see a real strong movement during the month of April on the House side to get something passed,” he said.

Bill has flaws

U.S. Congress is supposed to reauthorize legislation every six years that determines the volume of spending, the recipients of that spending, and the revenue sources of that spending for the nation’s surface transportation system. The current surface transportation plan, the “Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users” (SAFETEA-LU), had an expiration date of September 30, 2009. Since Congress was unable to reach consensus on a new six year authorization, the current legislation has been extended.  The most recent extension expires on March 31, 2012. 

Steenhoek said the fact that transportation stakeholders are pleased with a 2-year bill highlights “how far we’ve fallen” on adequately addressing transportation manners in this country.

“When it comes to transportation infrastructure, predictability of funding is just as important as the amount of funding. While it would be more beneficial to have a 6-year transportation measure, the Senate's two year bill does provide more certainty to state departments of transportation to commence and continue the transportation projects our country needs,” he said.

The Soybean Transportation Coalition said there is still no resolution on how to provide increased revenue for the transportation system. Currently, infrastructure projects are primarily financed by an 18.4 cent tax per gallon of gasoline purchased and a 24.4 cent tax per gallon of diesel fuel.

“This arrangement has proven to be unsustainable in adequately funding our nation’s surface transportation needs. As a result, new funding mechanisms for the next surface transportation bill are being explored and debated, but anything approaching an agreement is not on the horizon. As a result, the funding gap between what our infrastructure needs and how much the Highway Trust Fund can provide continues to widen,” Steenhoek said.

Agriculture groups were also disappointed that the bill to increase semi weight limits, provided the semi had a sixth axle, was not included. Soybean checkoff funded research had shown that doing so would not impact the road or create a safety hazard for others on the road. “If our system is stagnant, it is prudent to responsibly get more out of what we do have available,” he said.

The Senate bill did include a "sense of the Senate" clause that will recommend that the government use all revenue paid into the Harbor Maintenance Trust Fund for dredging harbors and channels. The Harbor Maintenance Trust Fund (HMTF) was created by Congress in 1986 to provide funding for harbor and channel dredging. Funds generated by the Harbor Maintenance Tax (a 0.125% ad valorem tax on imports) are deposited into the HMTF. Annually, only half of the funds deposited into the HMTF are actually utilized for harbor and channel dredging. The rest is appropriated by Congress for other, unrelated expenditures.

This has become a hot button issue as last year’s flooding created the need for increased dredging. Planned expansion plans for the Panama Canal also require greater water depth for ports and inland waterways to accommodate larger vessels.

Steenhoek said although the sense of the Senate doesn’t make it law, it could be included in the House version or added in during conference discussions.

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