Builders Support Highway Reauthorization Bill

June 17, 2009
Focus on the solvency of the highway trust fund and infrastructure say highway builders.

“Congress has painted itself into a corner in terms of no longer being able to kick the funding debate down the road. Elected officials very rarely make difficult decisions without a crisis, and we have definitely reached that level,” said ARTBA Chairman Charles Potts, president and chief executive officer of Indianapolis-based Heritage Construction & Materials. “Collectively, it’s our job to tell Congress to complete action as soon as possible on a robust reauthorization bill that contains new revenues for long-term transportation improvements and helps ensure we maintain the momentum that will carry the US to economic recovery.”

Addressing the long-term solvency of the federal Highway Trust Fund (HTF) and sustaining the gains of the stimulus law should be motivating factors for Congress and President Obama to complete action this year on the multi-year highway and transit reauthorization bill, says Potts. Transportation design and construction professionals must also generate the grassroots muscle necessary to keep the heat on elected leaders to get the job done right, the group continues.

Potts and ARTBA President Pete Ruane are taking it to the street in a series of speeches highlighting the need for grassroots effort to keep lawmakers focused on infrastructure issues.

Potts noted the projected revenues flowing into the HTF are approximately $90 billion below the level necessary over the next six years simply to maintain highway and public transportation investment levels that are in the current law—SAFETEA-LU. Last year, Congress provided an $8 billion infusion to the HTF to allow the Federal Highway Administration to meet its obligations, Potts points out. The US Department of Transportation says a similar scenario will occur later this summer.

“While some claim the root of this problem is the price of gasoline or improved automobile fuel economy, the truth of the matter is Congress knowingly created this crisis by dodging the revenue debate in the last bill,” Potts said. “They increased surface transportation investment over five years largely by liquidating the $12 billion balance in the Highway Trust Fund.”

Without reserves to further draw down, the programs will be entirely reliant on incoming revenues that are based on tax rates that have not been adjusted for 16 years. As a result, Potts says, Congress will have tough choices to make: cut investment levels, deficit spend, or raise new revenues.

While the HTF’s solvency is one of the key obstacles facing reauthorization, Potts says the stimulus clearly established transportation infrastructure investment as an agent of economic recovery. The $48 billion in transportation investments from that measure will serve as an example of the type of economic boost and job creation that can come from a robust, long-term federal commitment to transportation improvements, he said.

Failing to address the HTF shortfall would more than eclipse any gains from the economic stimulus package, according to Potts. In fact, forcing the programs to rely on existing revenues would cause the loss of 500,000 jobs through 2015. “This type of economic hit in one sector is clearly not the goal of the economic recovery package and not something Congress and the President are likely to let happen,” Potts said. Potts also addressed the reauthorization timeline. House Transportation & Infrastructure Committee Chairman Jim Oberstar (D-MN) is aiming to move his committee’s version of the reauthorization bill as early as July. In a recent speech to the Transportation Construction Coalition, Oberstar said his proposals would dramatically reform the federal highway and transit programs, address national needs like goods movement, and establish performance standards to regain the trust of the American people in the value of federal transportation investments. The Senate transportation committees are also making progress on their version of the reauthorization legislation.

One of the positive developments on the current bill, Potts noted, is a broad consensus among stakeholders in the transportation construction, general business, and public sector communities about the need to increase the federal motor fuels tax and other HTF revenues. These views are supported by two congressionally-chartered, independent commissions formed in the last reauthorization bill to make recommendations about how to meet the nation’s transportation needs, he said.

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