House to Consider $8 Billion Highway Trust Fund Shortfall Remedy and Update on House Passes Bill

The House of Representatives is reportedly prepared to consider legislation Wednesday to transfer $8.017 billion to the Highway Trust Fund to offset a projected shortfall in Fiscal Year 2009.

Sources indicate that the House leadership plans to expedite the bill, introduced last Thursday, to a floor vote using a procedure known as suspension of the rules. Under such a maneuver, the bill can bypass a committee hearing and gain House passage if at least two-thirds of representatives vote "yes." The procedure is commonly used in the House to pass noncontroversial legislation.

The bill, HR 6532, was introduced by House Ways & Means Committee Chairman Charles Rangel, D-N.Y. Its cosponsors include House Transportation & Infrastructure Committee Chairman James Oberstar, D-Minn., and John Mica, R-Fla., the T&I Committee's ranking minority member.

"We appreciate the strong support being shown by members of both the House and Senate to solve this critical problem, and keep America's transportation projects moving forward," said AASHTO Executive Director John Horsley. Several organizations have sent letters to members of the House today urging approval of the measure.

"The nation's highway system has significant capital, operating, and maintenance needs, and state departments of transportation and metropolitan planning organizations have developed long-term transportation investment plans based on anticipated guaranteed funding levels," wrote R. Bruce Josten, executive vice president for government affairs at the U.S. Chamber of Commerce. "A reduction in guaranteed spending in 2009 would disrupt projects already underway and further delay necessary maintenance, upgrades, and expansion of our nation's infrastructure."

The National Association of Manufacturers told representatives an infusion of cash to the Highway Trust Fund is important to prevent a deficit that would adversely affect everyone in the nation who supplies materials for highway construction.

The House's planned vote Wednesday follows efforts earlier this month by Senate transportation appropriations leaders Patty Murray, D-Wash., and Kit Bond, R-Mo., to also provide an injection of $8.017 billion to the trust fund. The Senate Appropriations Committee included the provision two weeks ago in reporting out the FY 2009 transportation spending bill. Senators Max Baucus and Charles Grassley, leaders of the Senate Finance Committee, have also led efforts for action to restore solvency to the Highway Trust Fund.

The president's budget proposal in February projected that the trust fund would show a deficit of at least $3.3 billion in FY 2009 because expenditures have exceeded the trust fund balance. A new forecast is due from the U.S. Treasury Department in late July.

A transfer of $8.017 billion to the Highway Trust Fund would match the exact amount transferred out of the fund into general revenue in 1998 as part of an agreement negotiated to win passage of such provisions as funding guarantees and budget firewalls for the trust fund programs.

AASHTO and other organizations have warned Congress and the states that the $3.3 billion cash shortfall forecast in the trust fund's Highway Account for FY 2009 would result in a cut of $14 billion in federal highway funding because of the way federal highway funds are disbursed over several years.

"With the impending deficit in the HTF, many states are making plans to drastically scale back state road programs," wrote Jennifer Wilson, president and CEO of the National Stone, Sand, & Gravel Association. "Industry experts calculate the funding cuts will result in job losses nationwide totaling 380,000."

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UPDATE - House Passes Highway Funding Bill, Brushing Aside Veto Threat

From Congressional Quarterly, By Colby Itkowitz, CQ Staff

Ignoring a White House veto threat, the House on Wednesday overwhelmingly passed legislation designed to shore up the federal Highway Trust Fund with $8 billion in general revenue.

Despite the president’s threat and opposition from some Republicans, the House passed the bill by 387-37. That was substantially more than the two-thirds majority required under the expedited procedure used for consideration of the bill.

“I wish as one of the strongest conservatives in the House to have some other alternative to bring you today, but I do not have that,” John L. Mica, R-Fla., the ranking Republican on the House Transportation and Infrastructure Committee, said.

The Highway Trust Fund earlier was expected to have a $3 billion shortfall in 2009, but new estimates scheduled to be released next week show that figure could increase to $6 billion as Americans drive less in response to $4 per gallon gasoline prices. The trust fund is financed through an 18.4-cents-per- gallon excise tax on gasoline.

Unless more revenue becomes available, hundreds of projects authorized in the 2005 highway law could not start and ones already in progress could have to be stretched out.

But the White House said in a statement of administration policy that Congress needs to come up with a better way to shore up the trust fund.

“This bill is both a gimmick and a dangerous precedent that shifts costs from users to taxpayers at large,” the White House said. “Moreover, the measure would unnecessarily increase the deficit and would place any hope of future, responsible constraints on highway spending in jeopardy.”

The Bush administration had suggested borrowing $3.2 billion from the federal mass transit account to cover the highway shortfall, but that was quickly rejected by most lawmakers.

Republicans on the House Budget Committee opposed the measure, as did their counterparts on the Appropriations Committee.

But most members of both parties were more concerned about keeping highway dollars flowing.

Rep. James L. Oberstar, D-Minn, chairman of the Transportation and Infrastructure Committee, promised that his committee will come up with creative financing when it tackles a rewrite of the surface transportation law next year. But he said that they were racing the clock to avoid a disruptive shortfall in the meantime.