Infrastructure funding in Congressional spotlight

| 6/10/2008

A handful of bills currently under consideration in Congress aim to put billions of dollars toward fixing the nation’s transportation and infrastructure crisis, elected and private-sector officials said Tuesday, June 10.

The House Transportation and Infrastructure Committee conducted a public hearing about financing infrastructure investments as part of an ongoing process to determine funding mechanisms leading up to the scheduled transportation reauthorization legislation due in Congress in 2009.

In January of this year, a federal commission known as the National Surface Transportation Policy and Revenue Study Commission announced that the U.S. needs to invest at least $225 billion per year to add capacity and maintain infrastructure over the next 50 years. The current rate of federal spending is less than $85 billion per year, according to the commission, including water systems along with highways and bridges.

“We are in the midst of an infrastructure crisis,” said Rep. Earl Blumenauer, D-OR, who was invited by the committee to explain the National Infrastructure Bank Act of 2007, filed in August 2007 as S1926 by Sens. Chris Dodd, D-CT and Chuck Hagel, R-NE.

“It is not just more money. It is how we spend the money and what we spend it on.”

A national infrastructure bank would loan state and local governments funding to construct infrastructure projects of national significance costing more than $75 million.

Rep. James Oberstar, D-MN, chairman of the House T&I Committee, asked each of eight panelists – including four lawmakers on Capitol Hill – about their ideas and proposals for financing infrastructure.

“This will be a continuing conversation. … My goal is that we have a surface transportation bill – at least the outlines of it – before the next administration takes office,” Oberstar said.

The legislation, HR3896, introduced in October 2007 by Rep. Rosa DeLauro, D-CT, calls for the creation of the National Infrastructure Development Corporation and an accompanying insurance corporation that could potentially leverage $9 billion in federal funds against state and local funds to create $58 billion in project investment.

Rep. Ken Calvert, R-CA, introduced the On Time Act of 2007, also known as HR5102, in January of this year. It would direct the U.S. transportation secretary to assess a fee of 0.075 percent of the value of an imported article – or a maximum of $500 – on all imported cargo arriving in a gateway port by multimodal container. The fee would be assessed only once upon entry into the U.S.

Calvert projects revenue at $63 billion over 10 years. Revenue would be put toward congestion relief including truck-only lanes and assist multimodal freight movement within the specific gateway city or port where it is collected.

Rep. Keith Ellison, D-MN, introduced HR3401 in September 2007. The bill is similar in purpose to the national infrastructure bank that the Dodd-Hagel bill in the Senate would create.

A second panel testifying Tuesday consisted of Everett Ehrlich, president of ESC Company; Mark Florian, managing director for Goldman, Sachs & Co.; Rudolph Penner, senior fellow with The Urban Institute; and Bernard Schwartz, chairman and CEO of BLS Investments.

Following is a recap of ideas discussed during testimony by both panels:

  • Grants and loans including TIFIA – the Transportation Infrastructure Finance and Innovation Act and Railroad Rehabilitation and Improvement Financing
  • State infrastructure banks
  • Tax exempt bonds; tax credit bonds; Grant Anticipation Revenue Vehicle Bonds; Build America Bonds
  • Federal infrastructure bank or banks
  • National Infrastructure Development Corporation
  • Railroad Infrastructure Development and Expansion Act for the 21st Century
  • Congressional appropriations
  • Leasing
  • Capital budgeting


Discussions about fuel taxes and whether to raise them and by how much weaved throughout the testimony. With fuel prices averaging above $4 per gallon for gasoline and nearly $5 for diesel, increases in fuel taxes remains a touchy political issue on The Hill.

Few lawmakers are disputing the need for more revenue, but the battle continues on how to collect it and spend it.

“If we want to get more out of federal resources, we need to evaluate not how we pay, but how we select,” Ehrlich said during his testimony.

Read Land Line Magazine and listen to “Land Line Now” on XM Satellite Radio Channel 171 Open Road for updates to the ongoing discussions of transportation funding.

– By David Tanner, staff writer