A Senate vote is possible as early as next Wednesday on final passage of a nine-month extension of federal highway and transit authorization, according to the American Association of State Highway and Transportation Officials (AASHTO).
The Senate took no action this week on the bill (HR 2847). It would extend surface transportation authorization until the end of this calendar year and deposit $19.5 billion of general revenue in the Highway Trust Fund. The package also includes restoration for this fiscal year of $12 billion in highway funding to the states that has been rescinded in recent years.
Last week, the House of Representatives amended the bill and returned it to the Senate. Senate leaders did not call up the bill this week, choosing instead to complete work on a package of tax-break and unemployment-benefits extensions.
Prior to the Senate's adjournment for the week Thursday evening, Senate Majority Whip Dick Durbin, D-IL, announced a cloture vote will take place at 5:30 p.m. EDT Monday on the latest House version of HR 2847. Durbin filed five amendments; however, it's unclear if he truly intends to further modify the measure or was simply using a procedural tactic known as "filling the amendment tree" to block Republicans from offering any amendments.
If the 60 votes needed to proceed to a final vote are obtained Monday evening, the Senate could take that vote as early as Wednesday and send the bill to President Barack Obama.
"We hope final action can now be taken on the surface transportation authorization bill," said AASHTO Executive Director John Horsley. "It is critical that state transportation departments receive certainty regarding their federal funding for the rest of the year so they can adequately make use of the upcoming summer construction season to put more Americans to work. Some states are already delaying issuance of construction contracts, so it is urgent for the Senate to clear HR 2847 and send it to the president rapidly."
The Highway Trust Fund shut down for two days March 1-2 after a prior authorization extension for its expenditures lapsed. Project reimbursements for state DOTs were suspended and 1,922 U.S. Department of Transportation employees were furloughed. Congress then enacted the current four-week extension that will expire March 28 if no further action is taken.
Senators approved a different version of HR 2847 on Feb. 24. Representatives amended several provisions last week including an increase in federal support for Build America Bonds that is meeting with some opposition in the Senate. The bill is known as the "Hiring Incentives to Restore Employment Act."
The House nearly doubled additional federal subsidies for Build America Bonds from $2.5 billion to $4.6 billion. That has attracted opposition from Republicans such as Sen. Chuck Grassley of Iowa, who contends the extra subsidies will go to Wall Street firms that underwrite the bonds for states and municipalities. Build America Bonds were created as part of last year's American Recovery and Reinvestment Act. They can be used for all sorts of public infrastructure projects. They are attractive to state and local governments because the federal government subsidizes 35 percent of the bonds' interest costs.
Since Build America Bonds were created in April 2009, $78 billion have been sold. Bankers estimate that by the end of this year, as much as $150 billion more of the bonds will be sold.
The Wall Street Journal reported Wednesday that investment firms have received fees exceeding $1 billion in less than a year selling Build America Bonds and that these firms are often charging states and localities higher costs than for traditional bond deals. Bank officials say the higher fees are justified because they are working harder to sell the bonds to investors who wouldn't traditionally buy municipal debt such as pension funds, insurance companies, and foreign investors.
On average, underwriting fees for Build America Bonds are $8.20 per $1,000 of debt issued, according to Thomson Reuters. By comparison, the standard fee for traditional tax-exempt bond issues is $5 to $6 per $1,000 of debt.
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