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News Briefs

Date Posted: August 1 2014

Road funding headed for lame duck?

With state lawmakers timid about initiating any sort of tax increase during an election year – even to repair Michigan’s crumbling roads – the state Legislature could be leaning toward waiting until after the Nov. 4 general election to vote on raising more money for road construction.

Many controversial pieces of legislation, like the state’s right-to-work law in 2012, were adopted during the “lame duck session,” the month-or-so period at the end of the year after the election but before the end of the legislative term.

“There is a very high likelihood” that road funding will be taken up in the lame duck session, House Minority Leader Tim Greimel (D-Auburn Hills) told the Off the Record television show in mid-July.

The Michigan Department of Transportation has been calling for at least $1.7 billion per year in new money, whether it’s through a gas tax increase or other means, to repair the state’s roads and bridges. The Republican-led state Legislature whiffed on an opportunity to raise that money, but did manage to come up with about $300 million more this year.

 

In Congress, still no long-term road funding plan

WASHINGTON (PAI)–Leaving virtually everything until the last minute, the Senate plans to open debate July 28 on a short-term cash infusion to the almost-empty trust fund that helps pay for road repairs, bridge replacement and bus and subway systems nationwide.

The debate will begin after Senate leaders agreed to votes on specific Republican amendments, all of which are expected to fail in the Democratic-run body.
The measure is important because the Highway Trust Fund, fueled by revenues from the federal gas tax, is about to run out of cash. That has led the federal Transportation Department to warn states not to count on checks after this month. Some states have already cut back or postponed projects, at the height of construction season.

“The reality is simply that we cannot have big-league economic growth with little league infrastructure,” new Senate Finance Committee Chairman Ron Wyden, D-Ore., told his colleagues on July 21, in explaining the bipartisan compromise his panel assembled.

“Unfortunately, all over our country, we have potholes and sinkholes, and one of the reasons we are not seeing them filled is because there is no long-term plan” to pay for repairs.

Transportation and construction unions have been lobbying lawmakers to approve a long-term highway-mass transit bill, funded by gradually raising the gas tax, now 18.4 cents per gallon. The tax hasn’t gone up since 1993.

“Without a long-term sustainable investment through re-authorization of a multi-year highway bill, our nation’s infrastructure will continue to decline, jeopardizing our safety, good jobs and our economic competitiveness,” said Laborers President Terry O’Sullivan – an outspoken supporter of a 12-cents-a-gallon 2-year gas tax hike – on July 17. Other union leaders agree, but they’re lobbying for the short-term bill, too.

Wyden agrees, but says Congress must approve the short-term fix first, and not with a gas tax hike. The short-term bill funds highways through diverting future money from firms that pay for federal pension guarantees and adds money from customs user fees. It also calls for getting money by cracking down on tax cheats. “As the transportation shutdown approaches with tens of thousands of jobs on the line,” the Senate panel crafted its plan, Wyden explained.

Democratic President Barack Obama is willing to sign the short-term fix, but he also wants a longer-term highway-mass transit bill. Otherwise, his Transportation Secretary warns, 700,000 construction jobs would be lost. But Obama’s 4-year $300 billion plan does not include a gas tax hike. Obama wants to fund highways by closing tax loopholes and taxing offshore corporate profits.

While waiting for Congress to act, Obama plans to establish public-private partnerships to invest in infrastructure projects. O’Sullivan said that’s a good idea, but cautioned the fund could legally cover only 20 percent of the nation’s road and bridge construction needs.

The Senate Republicans dislike the legislation. One GOP amendment would get the feds out of the highway-mass transit business altogether, turning all roads and other systems over the states, while abolishing the federal gas tax. Another would shorten the stop-gap bill to December or January, rather than May.