House panel says status quo would hurt economy

| 7/16/2009

A House panel believes a six-year transportation reform bill will generate more economic recovery than the White House’s proposed 18-month extension of the current program.

The debate over highway funding continued Thursday, July 16, with a hearing by the House Transportation and Infrastructure Committee’s Subcommittee on Highways and Transit.

Chairman Peter DeFazio, D-OR, said extending the status quo by 18 months will leave states in economic uncertainty and delay long-term transportation projects. DeFazio said a six-year authorization bill, if passed soon, would do more than a short-term extension.

“It is a proven fact that infrastructure spending, particularly transportation infrastructure spending, creates jobs and significant economic activity,” DeFazio stated in opening remarks. “Every $1 billion invested in transportation infrastructure creates or sustains over 34,000 jobs and results in $6.2 billion in economic activity.”

The Senate, on the other hand, believes an 18-month extension of current programs would buy the necessary time for lawmakers to hammer out details such as how a long-term authorization bill would be funded.

Earlier this week, the Senate Environment and Public Works Committee reported a bill to the Senate floor to move the extension forward, in step with U.S. Transportation Secretary Ray LaHood and White House officials.

House lawmakers still believe Congress can pass a six-year bill this summer.

The current program known as SAFETEA-LU is set to expire Sept. 30, but of even greater significance is the shortfall experienced by the Highway Trust Fund. The trust is slated to be broke sometime in August as transportation needs continue to outpace revenue.

Funding scenarios range from possible tax increases including fuel taxes to tolling to a tax on vehicle miles traveled. Other congressional committees have the task of sorting out the funding.

DeFazio has offered a plan that would replenish the Highway Trust Fund by taxing oil speculators. Taxing speculators by one-tenth of 1 percent would yield $40 million per year, DeFazio said.

“Let’s be flexible,” DeFazio said. “Maybe we need to borrow the money. Maybe we need to bond.”

Some lawmakers and White House officials have mentioned the possibility of a second economic stimulus package to follow up the American Recovery and Reinvestment Act.

Rep. James Oberstar, D-MN, chairman of the full House T&I Committee, and other House lawmakers said they would oppose a second stimulus unless it only involved transportation.

“If there is going to be a second stimulus, it’s going to be highways or nothing else,” Oberstar said.

Ranking Republicans on the T&I Committee, Rep. John Mica of Florida and Rep. John J. Duncan of Tennessee, aided Oberstar and DeFazio in drafting the six-year, $450 billion authorization bill. The bill cleared the Highways and Transit Subcommittee on its way to the full committee in late June.

Mica and Duncan stated that the White House proposal for 18 months of “status quo” falls short of what America needs to get out of its economic slump.

– By David Tanner, staff writer