Obama Proposes 48% Increase in Road Spending Over 6 Years

This story appears in the Feb. 21 print edition of Transport Topics.

President Barack Obama’s transportation reauthorization proposal would increase spending on roads and bridges over the next six years to $336 billion, a 48% increase over the $227 billion in the previous federal reauthorization package.

The proposal, however, does not specify how the higher level of spending would be funded.

In all, the administration is seeking $556 billion in legislation reauthorizing transportation spending, with substantial increases for urban mass transit and high-speed passenger rail projects.

The proposal is nearly twice the $286.5 billion authorized by the previous transportation law, known as SAFETEA-LU, which expired in 2009.

Obama unveiled his transportation plan Feb. 14, with the fiscal year 2012 budget released the same day. The federal fiscal year starts Oct. 1.

The proposal calls for transportation spending next year of $129 billion, a level the American Road and Transportation Builders Association said made it “one of the boldest budgets in memory.” Transportation spending in 2010 was $74 billion.

The $129 billion proposal includes $50 billion to improve road, rail, transit and airports systems.

Obama did not propose a new funding mechanism to pay for the higher spending total, saying only that the administration “is committed to working with the Congress on a bipartisan basis to ensure” the plan is funded.

Increasing the gasoline tax is not an option, U.S. Transportation Secretary Ray LaHood said at a press briefing after the reauthorization plan and 2012 budget were released.

“This administration has said time and time again that we are not in favor of raising the gas tax when we have a lousy economy,” LaHood said.Obama’s plan contains no change in the 18.4-cent-a-gallon federal gasoline tax nor in the 24.4-cent-a-gallon diesel tax.

However, under congressional “pay-go” rules, a funding source is required, the secretary said.

Others were critical of the lack of a funding source.

“While the administration is correct that we need massive long-term investments in transportation, these proposals beg the question of who is going to pay for it and what are they paying for,” American Trucking Associations President Bill Graves said in a statement.

ATA and the U.S. Chamber of Commerce support increased fuel taxes to pay for transportation infrastructure.

Gregory Cohen, president of the American Highway Users Alliance, said the absence of revenue sources made the reauthorization plan a “mirage.”

The administration is proposing new user fees, so far unspecified, on railroads, airline passengers and hazardous materials permits for trucks.

“User fees are simply a code word for new taxes,” Richard Moskowitz, ATA’s vice president and regulatory affairs counsel, told Transport Topics after the plan was released.

The plan’s emphasis on transit and high-speed rail drew strong criticism from highway advocates.

The proposal gives “very substantial increases in funding” to high-speed passenger rail and transit but “short shrift to our nation’s highways,” which most Americans use daily, Graves said.

Obama proposed $53 billion over six years for a new high-speed rail initiative and $119 billion for public transit, a 128% increase over SAFETEA-LU transit funding.

LaHood said high-speed rail is DOT’s “signature issue,” and transit investments are “huge.”

“Look, we’re making huge investments in roads, and we know that people will always drive their cars, but many people, certainly many people that live in cities . . . do not have an automobile because of the terrific alternatives that are offered,” LaHood said.

Under the president’s plan, spending for the Federal Motor Carrier Safety Administration would increase over six years to $4.9 billion from SAFETEA-LU’s $2.9 billion, partly for implementing and enforcing the new Compliance, Safety, Accountability program.

Under the reauthorization plan, 55 highway programs in the Federal Highway Administration, such as Scenic Byways and the Highway Bridge Program, would be folded into five “core” highway programs.

Obama’s plan also calls for “expanding” the Highway Trust Fund into a new Transportation Trust Fund with four separate accounts — for highways, transit, high-speed passenger rail and a National Infrastructure Bank.

Fuel-tax revenue would remain dedicated to the highway account. But that account, as well as the other three, still would need new funding sources with which to carry out the president’s plan.

The reauthorization plan does not contain a national freight policy, as some in trucking have advocated.

But Roy Kienitz, DOT undersecretary for policy, said at the briefing that the National Infrastructure Bank, which would get $30 billion over six years, is designed to fund big projects of national interest.

The bank could “do more on freight movement and ports and things like that. Those are really the areas that have gotten lesser attention in prior years,” Kienitz said.

The highway program is always going to be DOT’s biggest program, he added, but the agency is beginning to recognize that little federal money has been spent on other freight-related projects.

Graves said an infrastructure bank could “potentially shift funds away from critically needed highway and bridge projects.”

Congress was about to begin work on reauthorization in 2009 when Obama asked that it delay until the administration could write its own plan.

But last year, the Republican Party won control of the House and Rep. John Mica (R-Fla.), the new chairman of the Transportation and Infrastructure Committee, has said he wants to take a different approach.

Mica spokesman Justin Harclerode said it was “unclear” when Mica might comment on Obama’s plan.

Despite the lack of a funding source, LaHood said he was optimistic a reauthorization bill would pass this year.

“I believe transportation is about the most bipartisan subject you can talk about in Washington,” he added.

“It has been in the past. I believe it will be this year because every member of Congress has somebody in their district out of work, who could be working building a road or bridge,” the secretary said.