Senate Panel Approves 6-year, $278 Billion Highway Bill

the bipartisan committee vote on the DRIVE Act signals that lawmakers see political value in spending on transportation infrastructure.

the bipartisan committee vote on the DRIVE Act signals that lawmakers see political value in spending on transportation infrastructure.

A Senate committee unanimously advanced a 6-year, $278 billion highway bill amid lingering doubts the measure can actually be funded, let alone by July 31 when current highway spending authorization expires. A more likely next step is an extension until December.

If nothing else, the bipartisan committee vote on the DRIVE Act signals that lawmakers see political value in spending on transportation infrastructure. Whether the institutional obstacles can be surmounted to pass a bill and fund it, remains a big question. Chances are the eventual bill that passes will have a shorter timeframe.

Here is a recipe for how we get something other than a simple extension this year  – The 6-year DRIVE Act would need about $100 billion in additional funds to remain solvent through September 30, 2021. Even in DC, $100 billion is a lot of money. It's more likely the tax writing committees would come up with a smaller amount, something closer to $35 billion.

If that happens, the EPW authors will be forced to downsize the bill. The result would be a mini-DRIVE Act that funds transportation for two fiscal years and keeps the policy changes from the DRIVE Act intact. This two-year timeline is similar to MAP-21, the previous transportation bill that passed in 2012. 

If these pieces come together quickly, there is a slight chance the mini-DRIVE Act could pass by July 31. If they can't pull all the pieces together by then, but still show good progress, it's possible a very short-term extension will give leaders some breathing room and we could see a 2-year bill pass in the fall.

A simple extension through December would cost somewhere between $8 and $11 billion, so it seems plausible the tax writing committees could find another $20 billion or so to fund a 2-year bill, satisfy some transportation stakeholders and prove the Congress can actually govern. If they can't find more money, a simple extension of current law through December is the most likely scenario. 

The DRIVE Act

Components of the bill include the following: 

Fully-funds highway programs for 6 years

The bill reauthorizes the Federal-aid highway program at an increased funding level for six years, from FY 2016 through FY 2021. Funds are increased by 3% each year over the six years. Transit programs aren't included in this draft as FTA is under the jurisdiction of the Senate Banking Committee.

Increases support for core formula programs and more local control

The existing consolidated core highway program structure from MAP-21 is maintained, including: the National Highway Performance Program; the Highway Safety Improvement Program; the Surface Transportation Program; and the Congestion Mitigation and Air Quality Improvement Program.

The local MPOs share of Surface Transportation Program (STP) dollars are increased from 50% to 55%, with the state DOTs share reduced from 50% to 45. 

Also funding for the Transportation Alternative Program is increased from $800 million to $850 million and state DOT's are required to distribute funds to MPOs based on the proportionate share from FY2009 - Pre-MAP21 levels. This should provide significantly more money to local governments through TAP.

Funds major projects - A Return to Congressionally Directed Spending

Funding for Projects of National Significance starts at $300 million in FY16 and grows to $450 million in FY2021. Grant requests in urban areas must be at least $50 million to be eligible. 
This section is sure to get the most play in the press. The legislation tasks the Administration with compiling a list of eligible projects. However, the Administration is then directed to send a list of projects to Congress which includes "at least 2 times, but not to exceed 4 times, the authorization level for each fiscal year." This wish list will be sent to the Senate EPW Committee and House T&I Committee, where they will select the final awards. I guess it was only a matter of time. Basically, the Administration will send a big list of possible projects that are eligible and scored well and Members of the Committee will whittle it down and make the final selections. 

The program includes a set-aside for rural areas (20%) and ensures an equitable geographic distribution of funds.

Prioritizes bridges and large, nationally-important facilities 

The bill increases the funding that must be spent on projects to maintain and repair bridges off of the National Highway System, as these bridges often struggle to find a reliable funding stream. These city and county owned bridges were neglected under MAP-21. The bill requires that states allocate at least 110% of the funds they allocated to bridges in FY 2014. This will ensure more funds go to local bridge projects.

The bill also shifts additional revenue towards the Interstate System and the National Highway System to address the significant maintenance backlog on those facilities.

Provides substantial new funding to focus on freight and goods movement

The bill establishes a formula-based freight program, which will provide funds to all states to improve goods movement, reducing costs and improving performance for business. Funds for the freight program start at $2 billion in FY16 and increase to $2.5 billion in FY2021. 

It expands flexibility for both rural and urban areas to designate key freight corridors that match regional goods movement on roads beyond the Primary Highway Freight System.
The legislation improves efforts to identify projects with a high return on investment through state freight plans and advisory committees established under MAP-21.

Other important program funding levels

The bill funds the Federal Lands Access Program at $255 million in FY16 up to $280 million in FY21.

University Transportation Centers are funded at $72.5 million each year of the bill. 
TIFIA is funded at $675 million/year from FY16-FY21.

Accelerates project delivery and increases flexibility

Building on the reforms in MAP-21, the bill continues to accelerate the project delivery process. 
New reforms would improve collaboration between the lead agency and the participating agencies, allow for greater reliance on documents prepared during the planning process, and reduce duplication between agencies involved in the federal environmental review and permitting process.