The Senate approved legislation Friday that extends current highway funding levels until Feb. 29. The bill extends the provisions of the six-year Transportation Equity Act for the 21st Century, which expires Tuesday.
The House of Representatives approved an identical extension Thursday, and the bill will go to the White House where President Bush is expected to sign it before the end of the day Tuesday. Once enacted, the extension will provide approximately $14.8 billion for highways and $3.1 billion for mass transit projects.
Rep. Don Young, R-Alaska, and chairman of the Transportation and Infrastructure Committee introduced a five-month and six-month extension of the highway and transit programs last week. The House and Senate were forced to consider an extension to TEA-21 after the two houses couldn’t come to an agreement on a permanent reauthorization.
“Although this extension will provide funding for five months, on March 1 Congress will be faced with the same situation we face now,” Young said in a statement Wednesday.
In order to get the extension quickly approved by both the House and Senate, two provisions in the original extension proposal were dropped. One provision was the ethanol transfer, which would have increased the tax on ethanol-blended fuels by 5.2 cents per gallon. The extra funds from the fuel tax increase were expected to add $2 billion annually to the Highway Trust Fund. The second item dropped was the “dimmer switch” provision, which would have prevented a hard cutoff of funds if no reauthorization is enacted by March 1. Legislators said they dropped the measure because a long-term reauthorization would be more likely to be approved by March 1 without the precautionary provision.
“While we are disappointed that an extension is necessary, it is a first step to exacting a fully funded highway and transit program for one of the most vital infrastructure systems to the nation,” said Stephen Sandherr, chief executive of the Associated General Contractors.
Although the extension will provide funds for the near future, the lack of a permanent funding system puts added stress on state departments of transportation and might negatively affect state budgets. According to a recent nation-wide survey by the American Association of State Highway and Transportation Officials, the absence of a six-year reauthorization bill could result in $2.1 billion in delayed projects and the loss of 90,000 jobs.
“Major infrastructure takes years to build, and states must know the revenue is in the pipeline before they get started,” AASHTO executive director John Horsley said. “States will not start up a project that has no specific funding allocated a few years down the line.”