| April 2008 -- In late March, top executives of
the Associated General Contractors met with with U.S. Transportation
Deputy Secretary Thomas Barrett, and learned the Bush adminstration may
release a draft surface transportation legislation reauthorization
proposal by mid-April. The administration proposal would follow early ventures at framing reauthorization by industry stakeholders like the American Road & Transportation Builders Association, the Associated General Contractors, the American Association of State Highway & Transportation Officials, the National Asphalt Pavement Association, and the National Surface Transportation Policy and Revenue Commission. It also comes ahead of an industry fly-in in May. To maintain a steady flow of user fee-derived federal funding, reauthorization of the program is needed by Sept. 30, 2009, when the existing SAFETEA-LU act expires. Barrett acknowledged that a new administration would be in place when highway reauthorization legislation is debated next year. Nevertheless the administration has ideas for the future of the highway and transit programs that it wants in the debate. For example, the administration is interested in reforming the programs to reduce the 100-plus funding categories, instead creating only three to six national priorities, as articulated by the U.S. DOT following the report in January of the national commission, which suggested major expansion of the federal role. AGC reported that Barrett also said the administration wants to reduce traffic congestion, reform the environmental review process, and develop performance measures to direct where future investments should be made. He said the administration wants to change the debate on funding sources by bringing more private capital and other innovative revenue sources into the mix. AGC notes the 111th Congress, which begins in January 2009, will only have a nine-month window in which to reinstate the programs before SAFETEA-LU expires. Given that the current status of Highway Trust Fund revenue makes short term extensions very difficult, AGC expressed concern that failure to pass a reauthorization bill on time could be very disruptive to the highway construction market. AGC suggested that all available revenue sources will be necessary to fund the growing transportation infrastructure deficit and that AGC will continue to push to make it easier to utilize these various funding options. AGC pointed out, however, that for the near future, the motor fuels tax still is the most viable source of transportation funding because of its fairness, ease of collection, and revenue generating ability, and that this method should not be discarded in the short term. AGC recommended the creation of a Highway User Rate Commission to depoliticize the setting of a user rate on a regular basis. The rate would be based on the amount of revenue necessary to address the transportation funding shortfall as determined by the Federal Highway Administration using the biannual conditions and performance report. The fee would be set using a formula that includes consideration of the annual Consumer Price Index (CPI) and the Producer Price Index for construction materials. The rate determined by the commission would go into effect 60 days after being determined unless a majority of 60 or more votes in the Senate or 261 or more votes in the House overturn the decision. |
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