The Senate is set to take up legislation to keep federal highway money flowing to states, with just three days left before the government plans to start slowing down payments.
The House passed a $10.8 billion bill last week that would pay for highway and transit aid through the end of May 2015 if transportation spending is maintained at current levels. Under a schedule outlined by Majority Leader Harry Reid, D-Nev., the Senate would take up that bill Tuesday.
But senators who say the House bill uses budgetary gimmicks to pay for roads and bridges or who want to force Congress to act before the end of the year on a long-term plan to pay for transportation programs are expected to offer amendments. If any amendment passes, it would alter the underlying House bill and set up an 11th-hour showdown between the House and Senate on how to resolve the differences between their bills.
The Transportation Department says that by Aug. 1 the federal Highway Trust Fund will no longer have enough money to cover promised aid to states, and the government will begin to stretch out payments. Congress has kept the trust fund teetering on the edge of bankruptcy since 2008 through a series of temporary fixes because lawmakers have been unable to find a politically acceptable, long-term funding plan. States have been warned to expect an average reduction of 28 percent in aid payments.
Without action from Congress, the balance in the fund is expected to drop to zero by late August or early September. Some states already have cut back on construction projects because of the uncertainty over federal funding. President Barack Obama and other state and local officials have complained that the uncertainty over funding is costing jobs.
Dave Bauer, a lobbyist for the American Road and Transportation Builders Association, said federal aid pays for about 52 percent of the cost of road and bridge capital projects undertaken every year.
"So if you have 52 percent of your market that on an almost annual or every-other-year basis is subject to Congress not shutting everything down when there isn't a great track record on doing that, would you be making long-term investments and hiring people?" Bauer said.
An amendment sponsored by Democrats Sens. Tom Carper of Delaware and Barbara Boxer of California and GOP Sen. Bob Corker of Tennessee would provide only $8 billion, just enough to keep highway programs going through the end of this year. They say their aim is to set up another deadline in order to force Congress to come up with a long-term solution on how to pay for transportation programs when lawmakers return to Washington after the November elections and partisan fervor supposedly will have cooled.
The trust fund is in its current straits because the federal 18.4-cent-a-gallon gas tax and the 24.4-cent-a-gallon diesel tax haven't been raised in more than 20 years, while the cost of maintaining and expanding the nation's aging infrastructure has gone up. Cars and trucks are also more fuel-efficient than they once were and people are driving less per capita.
The most obvious solution would be to raise fuel taxes, but lawmakers are reluctant to raise taxes in an election year -- especially Republicans for whom a vote in favor of any tax increase could trigger a backlash from their party's base.
"I haven't heard of a single person that doesn't realize this issue has got to be dealt with, and the way we've been dealing with it is totally irresponsible," Corker said. "There is tremendous sympathy (in the Senate) for coming up with a long-term solution."
But under an agreement worked out between Reid and Senate Minority Leader Mitch McConnell, R-Ky., any amendments will require 60 votes for passage -- a high hurdle.
Another amendment would replace the House bill with a nearly identical bill approved by the Senate Finance Committee.