Congress gridlocked on transportation funding

If you needed another reason to be frustrated by congressional inaction, look at the traffic on Windy Hill Road, I-85 North and I-285.

Improvements that could immediately relieve congestion on those roads are among about 100 transportation projects totaling $447 million that are on hold in Georgia this year because of federal funding uncertainty.

Currently 55 percent of the state’s transportation budget comes from the federal government. But Congress is traveling the same rocky road that state lawmakers tread earlier this year as it seeks long-term funding for transportation. And it must act fast, by May 31, to keep federal transportation dollars flowing to the states.

Georgia lawmakers are trying to reduce the state’s reliance on federal funds. They voted at the end of March to nearly double the amount the state spends on transportation by adding a higher tax on motor fuel, nixing tax credits for jet fuel and electric vehicles, and imposing new fees on heavy trucks, electric vehicles and hotel stays.

After the new legislation takes effect July 1, the additional revenue will diminish to one-third the amount of the state’s transportation budget coming from Uncle Sam.

But the federal transportation program is still key, and that program is going broke. As a result, scores of roads, bridges and bicycle/pedestrian projects have been halted out of fear that Georgia won’t be reimbursed for the costs.

“We’ve been in a posture of putting projects on hold,” said Joshua Waller, director of government relations for the Georgia Department of Transportation. “We’ve been in and out of this posture for a little while now, because of the short-term extensions.”

Going in circles

Thirty-two times over the past six years. That’s how many times Congress has used short-term appropriations to bail out a federal transportation program that teeters on the verge of insolvency.

The latest extension ends on May 31. And while there has been some progress toward a compromise, a big deal on a long-term transportation bill is not imminent.

The problem is the highway trust fund. It bankrolls most of the road and bridge projects nationwide and is derived primarily from gasoline taxes.

The fund is dwindling because Americans are driving more fuel-efficient vehicles.

The 18.4-cent-per-gallon federal gasoline tax hasn’t been raised in more than 20 years. It is not indexed to inflation. And politicians are squeamish about raising the tax.

In fact, Republicans in both chambers agree that it’s not going to happen. House Majority Leader Kevin McCarthy, R-Calif., called it “politically impossible,” according to The Hill newspaper.

The White House proposed a six-year, $478 billion highway bill funded in part by a tax on corporate profits held overseas. However, it has not moved at all on Capitol Hill.

Another short-term fix likely

One proposal floated by Sens. Rand Paul, R-Ky., who is running for president, and Barbara Boxer, D-Calif., would extend the highway trust fund for two years and pay for it with a tax on companies bringing back overseas corporate profits at a new lower rate.

Georgia Republican U.S. Sen. Johnny Isakson said that in internal Republican meetings, this idea has been met with resistance by Senate Finance Committee Chairman Orrin Hatch, R-Utah, because it would undercut chances for a deal on corporate tax reform.

And even the repatriation tax plan would require some sort of short-term extension before it could get done.

After years of atrophy, the Senate has moved on serious legislation, Isakson said. He praised Majority Leader Mitch McConnell, R-Ky., for convening a series of high-level meetings to get a transportation bill done.

“It’s only a matter of time that that highway trust fund debate comes to the floor of the Senate,” Isakson said. “It may be the fall, or it may be pressing up on the end of the year, but it’s going to come.”

Timing is everything

GDOT would prefer an extension that lasts at least through the end of the calendar year. That would ensure less disruption in getting road projects done through the critical summer months when weather is best.

Isakson said the length of the extension is still being debated.

“Well, GDOT wants it now and I don’t blame ’em,” Isakson said.

“And I understand that and I represent all of Georgia, the constituents who ride on the bumpy roads and the people who pave it and don’t have the money to pave it right now because the trust fund’s broke. And I want to get it done as fast as possible. But I want to fix it right, not wrong.”

McCarthy recently told reporters that his chamber would consider a short-term highway bill this month.

It remains unclear how a short-term deal would be paid for.

MARTA funding also in doubt

MARTA is also anxiously awaiting a solution.

The transit agency relies on federal funds for maintenance and equipment costs. Last year, MARTA got about $124 million in formula grants via the highway trust fund. Without that money, MARTA would have to borrow from other sources or defer purchases and maintenance.

Jeff Boothe, a lobbyist for MARTA, has worked on every authorization bill since 1982. He said so far Congress has considered and rejected ideas to return all the gas tax money back to states, to privatize the federal transportation program, and to reclaim foreign profits from overseas.

Meanwhile, they are running out of programs to cut in order to keep offsetting bailouts for transportation.

“All the low-hanging fruit is gone,” Boothe said. “It is politically tougher. I think some of that pressure will be the impetus to finally come up with a sustainable funding source.”

Boothe is hopeful that a long-term bill will be passed before 2016 electoral politics make the issue even more of a political hot potato.

“We have to act, because surface transportation is important to the economy and our infrastructure system,” Boothe said. “The biggest challenge … is what is the funding source that will sustain the program?”