American Association of State Highway and Transportation Officials

Obama Administration Releases Principles for 18-Month Transportation Authorization

By LUCAS WALL
AASHTO Journal
July 2, 2009

The U.S. Department of Transportation yesterday sent to congressional committees a two-page memorandum outlining the administration’s proposal for a temporary 1½-year authorization of federal surface transportation programs, which would last from Oct. 1 of this year to March 2011.

Ray LaHood, U.S. transportation secretary, last month asked Congress to delay a full six-year authorization bill until late 2010 or early 2011. (The current legislation, known as “SAFETEA-LU,” expires Sept. 30.) Instead, LaHood has told congressional committees at hearings and in private meetings with key representatives and senators that the administration wants to couple an 18-month authorization measure with interim funding to shore up the Highway Trust fund, which is expected to experience a cashflow shortage as early as next month, according to the Federal Highway Administration.

The memo released yesterday includes some more information about the secretary’s proposal, though falls short of answering key questions such as where the administration will pay for the $20 billion in interim Highway Trust Fund revenue. An increase in the federal gasoline and diesel taxes, which brings in the vast majority of trust fund money, has been ruled out by the administration during the current economic recession.

Regarding funding, the memo calls for the Highway Trust Fund infusion to be offset by other tax collections over a 10-year period. It notes only that “international tax enforcement” efforts could procure the revenue, but stops short of specifically requesting that funding source. U.S. DOT has requested that Congress provide the trust fund $20 billion to continue project reimbursements to state transportation departments and transit authorities at currently authorized levels through the second quarter of federal Fiscal Year 2011.

“Legislation to address the HTF shortfall should pass before the August recess to avoid disruptions to state cash management for further strain on state budgets,” according to the administration’s memo to Congress. “Although an extension of the HTF is urgent, the administration believes that this opportunity can used to put in place a limited set of carefully thought-out reforms that can form the basis for further reforms in a full six-year reauthorization.”

LaHood has previously called for some “minor reforms” to be included in any legislation providing interim funding for the Highway Trust Fund. For the first time, yesterday’s memo outlines what those reforms would be:

  1. Establish performance goals and base project selections on merit criteria that increases returns to transportation investment.
  2. Spend $300 million to improve state and metropolitan planning organization project evaluation capacity (a voluntary program).
  3. Spend $10 million for U.S. DOT to develop performance goals and establish guidelines for states and localities on project evaluation.
  4. Increase transparency in state and local project reporting.
  5. Support efforts to improve regional access and mobility and enhance the livability of communities. Livability guidelines should include reductions in travel times, smart growth, preservation of open space, and more-integrated responses to land use and transportation needs.

A conference call reportedly was held between the administration and some state officials yesterday to review the memo sent to Congress. Roy Kienitz, U.S. Department of Transportation undersecretary for policy, led the briefing.

The administration’s two-page memo is available at tinyurl.com/AJ070209-Memo1.

Lucas Wall can be reached at lwall@aashto.org or 202-624-3626