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White House backs House road funding bill; conservative groups decry ‘budget gimmicks,’ ‘fee increases’

Transportation advocates called the proposals to do away with federal infrastructure funding "unserious and irresponsible" on Monday.

The Trucker News Services

7/15/2014

The White House on Monday backed a $10 billion bill in the Republican House that would extend federal transportation funding through next spring.

The surprise endorsement of the bill, which is scheduled to come up for a vote in the House on Tuesday, clears the way for a deal with Democrats in the Senate.

For most of the year, President Obama has pushed lawmakers to approve a transportation funding package that would last four years and include $302 billion in road and transit spending.

But with transportation funding expected to run out next month, the White House said Monday that Obama would accept the House's temporary measure, which would only extend transportation funding until May 2015.

“With surface transportation funding running out and hundreds of thousands of jobs at risk later this summer, the administration supports House passage of H.R. 5021,” the White House said in a statement, The Hill reported. “This legislation would provide for continuity of funding for the Highway Trust Fund during the height of the summer construction season and keep Americans at work repairing the Nation's crumbling roads, bridges, and transit systems.”

The White House lamented that lawmakers have largely ignored Obama’s transportation proposal, which relies mostly on using $150 billion from closing corporate tax loopholes to close a shortfall in federal infrastructure funding that is predicted to be $16 billion per year.

“Congress should work to pass a long-term authorization bill well before the expiration date set forth in H.R. 5021,” the White House said before referencing Obama’s proposal.

Meanwhile, a pair of influential conservative groups have begun mobilizing against a $10 billion bill to extend federal transportation funding that is scheduled to come up for a vote in the House on Tuesday.

The Heritage Action and Club for Growth groups said Monday that would both be scoring lawmakers' votes on the transportation bill, which was introduced last week.

“The bill would offset the additional spending over the next decade through a series of revenue raisers, budget gimmicks and budget transfers,” Heritage Action wrote in a blog post.

"Excessive spending levels set by highway bills enacted in recent years, and many spending diversions to non-road, non-bridge activities, have put the [Highway Trust Fund] on an unsustainable path," Heritage Action continued. "The aforementioned bailouts — which violated the user pays, user benefits principle that has long defined the federal highway program — were predictable and promise to be more frequent in the future."

The Club for Growth issued a similar warning on Monday in action alert to its members of its own.

“This bill uses budget gimmicks and fee increases to bail out a wasteful and inefficient program that shouldn't even exist,” the Club for Growth said in an action alert to its members.

The traditional source for transportation funding has been revenue that is collected from the 18.4 cents per gallon federal gas tax. The tax has been stagnant since 1993, however, and has struggled to keep pace with infrastructure expenses as cars have become more fuel efficient.

The federal government’s current transportation funding level is about $50 billion per year, but the gas tax only brings in approximately $34 billion annually.

Transportation advocates called the proposals to do away with federal infrastructure funding "unserious and irresponsible" on Monday.

"Proposals by Heritage Action and its acolytes at the Club for Growth to 'devolve' federal highway spending without offering a viable alternative are unserious and irresponsible," Association of Equipment Manufacturers spokesman Michael O'Brien said in a statement.

"It's essential that Congress prevent a shortfall in the Highway Trust Fund next month, but lawmakers should also act to fix the trust fund before the end of this year," O'Brien continued.

Lawmakers are considering using revenue from other areas of the federal budget like pension changes and custom fees to pay for a temporary extension of the current transportation funding level.

The White House said that Obama’s proposal, which would increase the annual funding level to about $75 billion per year, is “fully paid for through existing revenues and by reforming business taxes to help create jobs and spur investment while eliminating loopholes that reward companies for moving profits overseas.”

But those tax reforms have not even come up for a vote yet, and so close to elections many pundits think few politicians on either side of the aisle will go near tax reforms.

The Department of Transportation has warned that its Highway Trust Fund will run out of money in August, a full month before the current transportation funding legislation had been scheduled to expire.

The agency has said that it would begin cutting back payments to state and local governments on Aug. 1 if Congress does not reach a deal to extend the road and transit funding.

Heritage Action has disputed the Transportation Department's analysis, and the group said Monday that "there is no economic danger in rejecting the proposed bailout.

"Because Washington funds about a quarter of road and transit spending, a 28 percent cut to the federal share is a 7 percent reduction to spending over all," the group wrote. "Additionally, the bill offsets its ten months of spending over a 10-year period, increasing spending in the near-term with no certainty the funds will ever be fully recouped."

Heritage Action and the Club for Growth have supported efforts to eliminate the gas tax and transfer authority over federal highways and transit programs to states and replace current congressional appropriations with block grants.

The gas tax, which is currently priced at 18.4 cents per gallon, has been the source of transportation funding in Congress since the Department of Transportation’s Highway Trust Fund was created.

The tax has been stagnant since 1993, however, and has struggled to keep pace with infrastructure expenses as cars have become more fuel efficient in recent years.

Heritage Action said Monday that each temporary transportation funding patch makes the gas system less sustainable.

The Trucker staff can be reached to comment on this article at editor@thetrucker.com.

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JB Hunt