Obama Signs Trust Fund Rescue into Law
President Barack Obama on Aug. 8 signed into law a $10.8 billion bill that keeps a federal highway account funded through May 2015.
The law relies largely on an accounting technique called pension smoothing to raise revenue. Several senior Democrats were opposed to the pension provision, which allows companies to lower legally required payments into their employee retirement programs temporarily, boosting a company’s taxable income.
The Highway Trust Fund is used by the Department of Transportation to reimburse states for certain costs related to large-scale infrastructure projects. Without the short-term funding boost, DOT officials said they would have scaled back reimbursements for active transportation projects. Those big-ticket highway projects include the trucking industry and related industries.
The 10-month legislation may have cleared Congress with bipartisan support, but the Obama administration continues to push ahead with legislation that would keep the trust fund solvent for multiple years.
“While we at DOT are glad to avoid those painful cuts, we — along with thousands of commuters, construction workers, freight shippers and manufacturers — know that it’s still not the long-term solution that America’s transportation system really needs,” Transportation Secretary Anthony Foxx wrote on his blog last week.
