PB Transportation Update

January 25, 2012 Interim Update

PREPARED BY CATHY CONNOR - MANAGER OF GOVERNMENT AFFAIRS

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Now that both houses of Congress are back in session, things are moving quickly on a number of fronts.

Yesterday, the House approved another short-term extension of the FAA authorization bill through February 17. It is a clean extension with no policy changes. The bill now goes to the Senate which is expected to approve it this week before the January 31 expiration of the current extension. The additional extension will give Congress some breathing room in order to finalize the multi-year bill. The major sticking point on the longer term bill was resolved last week and now, after 23 extensions, Congress hopes to finally be able to quickly pass a multi-year bill.

Things are moving quickly in both the House and Senate on a multi-year surface transportation bill. The latest schedule for action on the House version of the reauthorization bill, now called the "American Energy and Infrastructure Jobs Act", HR 7 is as follows:

- Thursday Jan 26: Briefing of House T&I Committee members

- Friday Jan 27: Bill text released

- Thursday Feb 2: House T&I full Committee mark-up

- Week of Tuesday Feb 14 - Friday Feb 17: House floor action

The bill also includes authorization of an expansion of domestic energy production. Attached to this email is a brief overview of the bill issued by the T&I Committee. There is not much new in this summary that wasn't previously released by Chairman Mica earlier in July under the title "A New Direction". It is expected to be a five-year bill funded at about $52B per year, which is essentially current-level funding for highway and transit programs. The only mention of new revenue is the statement, "Revenues from additional oil and gas production will help fund programs". This revenue source is highly controversial and CBO estimates indicate it will not raise nearly enough revenue to fund the entire bill.

In the Senate, EPW Chairman Barbara Boxer (D-CA) announced yesterday that both the Senate Finance Committee (funding) and the Banking Committee (transit) will mark-up their titles of a two-year reauthorization bill next week. Boxer said that the Finance Committee has identified the $12B in offsets (and perhaps even more) needed to fill the funding gap, although no details about the source of the revenue have been provided.

Last night, President Obama gave his third State of the Union address. As in previous years, he mentioned infrastructure and transportation, however, he did not mention high-speed rail, a major Administration priority.

The President's remarks concerning infrastructure consisted of, "Building this new energy future should be just one part of a broader agenda to repair America's infrastructure. So much of America needs to be rebuilt. We've got crumbling roads and bridges; a power grid that wastes too much energy; an incomplete high-speed broadband network that prevents a small business owner in rural America from selling her products all over the world. During the Great Depression, America built the Hoover Dam and the Golden Gate Bridge. After World War II, we connected our states with a system of highways. Democratic and Republican administrations invested in great projects that benefited everybody, from the workers who built them to the businesses that still use them today. In the next few weeks, I will sign an executive order clearing away the red tape that slows down too many construction projects. But you need to fund these projects. Take the money we're no longer spending at war, use half of it to pay down our debt, and use the rest to do some nation-building right here at home".

The FTA NPRM on Major Capital Investment Projects/New Starts-Small Starts Guidance which was previously distributed as part of the January 20 Update, was officially published in the Federal Register today. Here is a link. Comments are due by March 26. PB is currently working on a summary and analysis of the draft regulations and policy guidance.

January 20, 2012 Update

Next week both the House and Senate will be back in session together for the first time in 2012. Congress has a full plate of issues to address this year, a number of which need to be dealt with very quickly. However, the congressional schedule is truncated this year because of numerous breaks for the various primaries, the two party conventions and an earlier than usual adjournment in the beginning of October in advance of the November 6 elections. Most observers assume there will have to be a Lame Duck session following the elections. All 435 House members and one-third of the Senate will be up for election, in addition to the presidency. Here is a link to a list of both presidential (page 1) and congressional (page 3) 2012 primary dates, listed by state and by date (page 5).

Other important upcoming dates to note are the State of the Union address on Tuesday, January 24 and the release of the Administration's FY'13 budget recommendations on February 6. Indiana Governor Mitch Daniels is scheduled to give the Republican response to the President's address. Key legislative dates include the expiration of the 22^nd short-term FAA authorization bill on January 31, the expiration of the current short-term highway and transit authorization on March 31 and the expiration of the two-month extension of the payroll tax cut and unemployment benefits on February 29.

FAA Authorization

As mentioned above, the current short-term FAA extension expires very shortly on January 31. Given the limited number of days Congress will be in session between now and then, it is very likely that an additional extension, the 23^rd, will be needed, even if it is only for a few days or weeks, if they are close to an agreement. Otherwise, a longer extension, possibly through the end of the year could be enacted. There is only one major issue holding up final passage of the bill relating to a controversial labor provision. It has now been elevated up to House Speaker John Boehner and Senate Majority Leader Harry Reid to resolve. They have said this is a priority bill, but so far there is no deal in sight.

Surface Transportation Authorization

This week House T&I Committee Chairman John Mica said that the House surface transportation authorization bill is close to being ready to introduce and he has been given floor time with the goal being to get it through the House by the Presidents' Day recess which begins on February 17. He has scheduled an invitation-only stakeholder's briefing for this Thursday. However, it is unclear how large the bill will be and how it will be funded. Before the holiday recess, Speaker Boehner indicated he planned to pay for a multi-year transportation bill by combining it with an energy bill and using the revenue from fees and royalties from expanded oil and gas exploration. However, this proposal is very controversial and CBO estimates that it would not raise nearly enough money.

The Senate is also struggling to find the funds to pay for its two-year authorization bill. Recent reports suggest that the amount needed to close the funding gap has increased from $12B to over $13B. In the meantime, both bodies must find enough revenue to pay for a full-year extension of the politically popular payroll tax cut and unemployment benefits which have only temporarily been extended through the end of February. It is likely this effort could use up most, if not all, viable revenues sources.

Most industry sources believe that even if sufficient funding is identified and the House and Senate bills move quickly through the legislative process, it is logistically impossible to pass a final bill by the March 31 deadline. At that point, if sufficient progress is being made, they could opt to pass a very short extension, perhaps only several weeks long, or they could decide to pass an extension through June, September or even through 2012 with the hope that the political environment will be more conducive after the November elections. However, at some point, possibly as early as this Fall, the highway account of the Highway Trust Fund will start to run out of money requiring another General Fund bailout simply to fund any additional extensions. However, there is no assurance that such a bailout would be acceptable in the current budget and political environment.

In an effort to pressure Congress to act, the US Chamber of Commerce, in conjunction with the Americans for Transportation Mobility (ATM) coalition will be sending a letter to Congress urging timely passage of a reauthorization bill. Their goal is to get as many industry groups, companies, state chapters, etc. to sign the letter. Parsons Brinckerhoff has signed on.

Other News

The lobbying effort to include an extension of the transit commuter tax benefit continues. The parity that the transit employee benefit had with the parking benefit of $230 per month expired at the end of 2011. Although there appears to be strong support in Congress for extending the transit benefit, the issue is caught up in the larger controversy over how to pay for the payroll tax cut and unemployment benefits extensions and other expired tax provisions.

Both FHWA and FTA have released partial-year FY'12 funding. Although a full-year DOT FY'12 appropriations bill has been signed into law, those DOT programs funded with Highway Trust Fund dollars are only authorized through March 31. Therefore only six months of apportionments/obligations can be made for those programs, which include most highway programs and the transit formula programs.

The FTA FY'12 apportionments and allocations notice was published in the Federal Register on January 11 and can be accessed here. Formula programs received six-month allocations while New Start/Small Start projects, which are funded by the General Fund, received full-year allocations. The FHWA FY'12 notice of contract authority is available here. The FHWA apportionments include the first six months of the total $1.96B cut in highway funding for FY'12.

US DOT announced $40.8M for 58 projects to improve access to national parks, forests and wildlife refuges. A complete list of projects is available here. The funds are authorized by the Paul Sarbanes Transit in Parks Program and administered by FTA in coordination with the Department of Interior and the US Forest Service.

US DOT also announced $77M in grants to 22 University Transportation Centers (UTCs). A list of grant recipients is available here. In the past, most federal funding for UTCs was earmarked by Congress. This is the first time that many of the UTCs were required to compete for funding by submitting applications to US DOT and the centers were selected by the Department. This resulted in some major changes with several new universities designated and a number of others no longer designated as consortium leads.

At this week's US Conference of Mayors meeting, US DOT Secretary Ray LaHood announced that the long-awaited NPRM of FTA's New Starts/Small Starts Guidance will be published in the Federal Register next week. The draft Guidance is expected to focus on getting transit projects through the approval process faster and more efficiently. The comment period may be as short as 60 days because FTA is anxious to issue a final rule before the end of 2012 while this Administration is still guaranteed to be in office and in a position to make decisions using the new rules.

LaHood also indicated that he expects the Notice of Funding Availability (NOFA) for the FY'12 TIGER IV discretionary grant program to be published in the Federal Register by the end of January. The FY'12 DOT appropriations bill includes $500M for the 4^th installment of the TIGER program. The goal is to announce the grants by early Fall.

December 20, 2011

Despite their best efforts to adjourn last Friday or over the weekend, Congress remains in session with only one issue left to resolve - a tax extenders bill to extend the payroll tax cut, unemployment insurance and the Medicaid "Dr. Fix".

Last week the House passed a year-end tax extender bill with only 10 Democrats voting in support. However, the House bill also includes a highly controversial provision to expedite approval of the Keystone XL pipeline. Over the weekend, the Senate approved its version of a tax extenders bill, but it only extends the tax provisions for two months to allow Congress to come back next year and revisit the issue. The House voted this morning to disagree with the Senate bill, insisting on a full year extension. It is unclear how this will all play out over the next few days. Right now, neither the House nor Senate-passed bills include an extension of the transit commuter tax benefit.

Congress has not been able to resolve the final issue holding up passage of a multi-year FAA Authorization bill related to union mediation. Despite a number of last minute efforts, it appears Congress will adjourn for the year without passing a final bill. The current short-term FAA extension expires on January 31, 2012, which leaves little time to complete a bill given the very limited number of days Congress will be in session in January. Earlier this fall, House T&I Committee Chairman John Mica said he would not support another short-term FAA bill after Congress passed the 22^st extension, although he has recently said that any extension will have to come with an unspecified price.

Upcoming dates to note include: The State of the Union address will be held on January 24. The House returns to session on January 17 and the Senate on January 23. However, the two bodies will only be in session at the same time for four days in all of January.

Senate Commerce Committee Surface Transportation Authorization Package

The Senate Commerce Committee approved four bills on December 14 which will eventually be folded into the Senate surface transportation authorization bill (MAP-21) when it comes to the floor. The bills include S.1449, which reauthorizes NHTSA for two years; S.1953, which does the same for the Research and Innovative Technology Administration (RITA); S.1952, which reauthorizes the Office of Hazardous Materials Safety and S. 1950, the Commercial Motor Vehicle Safety Enhancement Act of 2011.

The only bill which encountered any debate or controversy was S. 1950. Senator Kay Bailey Hutchison (R-TX), the Ranking Republican on the Committee, offered an amendment to strike Title XII of the bill, Senator Lautenberg's (D-NJ) "Surface Transportation and Freight Policy Act of 2011". The amendment was defeated by a partisan vote of 11 to 13 and the bill was then passed by a similar partisan vote of 13 to 11.

The approved S. 1950 now includes the following elements from Lautenberg's original FREIGHT Act:

Development of a National Freight Transportation Policy
Creation of a National Freight Infrastructure Investment Grant Program
Establishment of an Office of Freight Planning and Development in US DOT

Senator Hutchison or other Republican Senators may place a hold on the Senate Commerce Committee package preventing floor consideration. Although Hutchison has some serious concerns about the legislative process under which the amendment was offered, she is primarily upset about the bill's creation of a new unfunded discretionary program for National Freight Infrastructure Investment Grants that might use Highway Trust Fund dollars, possibly even to support private sector freight rail projects. She and others are also concerned that the requirement for a National Freight Policy is an extra layer of planning on top of the existing planning process at a time when Congress is trying to streamline the planning process. The American Trucking Associations (ATA) and Highway Users Alliance(HUA) have come out strongly against the FREIGHT ACT while other industry groups strongly support the bill's focus on intermodal corridors, goods movement, and the nation's freight network.

A separate rail title, potentially including amendments to the Passenger Rail (PRIIA) and Amtrak legislation, that the Commerce Committee had at one time hoped to mark up before the end of the year was pulled after the freight railroads raised numerous objections. The Rail title will be revisited early next year.

The Banking Committee had scheduled a markup on the transit title of the surface transportation bill for December 16; however, the markup ended up being postponed until early next year. The Committee has not yet released a staff draft of the bill for stakeholder review.

Senate Finance Chair Max Baucus has indicated he will not act on the finance title of the surface transportation bill until the tax extenders bill has been completed which means not until sometime in 2012.

FY'12 Appropriations

Last week Congress passed a nine-bill, $900B+ "megabus" FY'12 appropriations bill, HR 3671, to fund most federal agencies through the remainder of the fiscal year. Passage did not impact funding for US DOT programs since the FY'12 DOT Appropriations bill was previously passed in November as part of a three-bill "minibus" package. The new bill does include funding for DHS/FEMA, the Corps of Engineers, DOE and DOD, and other infrastructure related programs.

H.R. 3671 provides a total of $5B for the Corps of Engineers in FY'12, which is higher than both the House and Senate proposed levels and exceeds even the Administration's request of $4.57B.

TIGER III Grants

On December 15, US DOT made the formal announcement of the third round of TIGER Grants. Here is a link to the US DOT press release and a link to the full list of selected projects.

Secretary Ray LaHood announced that 46 projects across the country will receive a total of $511M. The projects were selected from a total of 848 applications, with funding requests totaling more than $14B. According to U.S. DOT, roughly 48% of the funding will go to road and bridge projects including over $64 million for Complete Streets projects benefitting motorists, bicyclists and pedestrians; 29% of the funding will support transit projects; 12% will go to port projects; and 10% will support freight rail projects.

The FY'12 DOT Appropriations bill included $500M for another round of TIGER discretionary grants. US DOT is expected to issue of Notice of Funding Availability for a fourth round of TIGER funds in early 2012.

December 9, 2011 Update

Congress is expected to adjourn for the year as early as next Friday, December 16, but possibly as late as December 23. Either date leaves very little time to wrap up a considerable amount of business, including passing legislation to fund the vast majority of the federal government through the end of FY'12 and to extend many critical expiring tax provisions. Although the FY'12 annual appropriations bill for US DOT programs (as well as Agriculture and Commerce/State/Justice) has been signed by the President, the remaining nine funding bills, including the Department of Defense, still must be passed. The current short-term Continuing Resolution (CR) expires on December 16.

The goal is to include the remaining nine bills in a so-called "megabus" bill which will provide new appropriations for the remainder of FY'12. However, unresolved issues may force as many as three of the funding bills (Labor/HHS/Education, Interior/Environment and Financial Services) to be dropped from the larger bill and be funded under a Continuing Resolution (CR) which, for most programs, simply extends existing funding levels for another year.

The year-end tax extenders bill may well be the last bill to pass before the holidays and therefore, as usual, there is a clamor to add numerous extraneous provisions. The primary tax breaks proposed for extension are the payroll tax cut and unemployment benefits. PB is actively working to support inclusion of an extension of the expiring transit commuter tax benefit. The current transit tax benefit of $230 per month - on par with the parking tax benefit - is due to roll back to only $125 a month in 2012 unless extended by Congress, even as the parking benefit is bumped up to $240 as an inflation adjustment. Unlike some other tax extenders, the commuter benefit cannot be fixed retroactively next year.

Unfortunately, one bill that will not be debated before the end of the year is a House surface transportation authorization bill. Last week, House Speaker John Boehner announced that there is not enough time to bring a House authorization bill to the floor and House T&I Committee Chair John Mica (R-FL) said that therefore the Committee would not introduce or mark-up a bill until early next year.

Surface Transportation Authorization

On November 17, House Speaker John Boehner announced that he and House T&I Committee Chairman John Mica planned to introduce and quickly pass, HR 7, the "American Energy & Infrastructure Jobs Act", which would authorize surface transportation programs for five years and be funded in part by revenues from fees and royalties from expanded oil and gas exploration and drilling.

Before the bill was ever introduced, however, the Speaker and Chairman Mica announced last week that there is not sufficient time to mark-up or debate a bill this year. Some observers speculate that the postponement is due more to the controversy surrounding the proposed revenue source and the preliminary estimates that suggest the proposed oil and gas revenues would not produce nearly enough revenue.

There also seems to be some differences between Chairman Mica and the Republican leadership regarding the length of an authorization bill. Mica has been adamant about the need for a six-year bill, while his leadership seems to be exploring a shorter term measure that could be characterized as a jobs bill funded with whatever revenues can be found.

The delay is a serious concern given how little time there is until the current short-term authorization expires on March 31, 2012. Congress is only in session approximately six days in January and will be on recess at least one week in February.

In the Senate, despite the EPW Committee passing a bi-partisan highway authorization title, MAP-21, by a unanimous vote, the Banking Committee still needs to act on the transit title of the Senate two-year bill and the Commerce Committee must act on safety and rail titles. The Banking Committee is tentatively scheduled to mark-up the transit title on Thursday, December 15. The Commerce Committee may proceed to mark-up the highway safety, hazmat and research provisions next week, but will not act on a rail title before the recess. More importantly, the Senate Finance Committee must still identify the approximately $12B in additional revenue needed to pay for the bill. Although Finance Committee Chairman Max Baucus (D-MT) continues to say he will find the necessary offsets, he has not yet identified any specific source.

The issue of the Highway Trust Fund funding gap has been further confused by the recent release of OMB estimates that suggest a need for less than $12B to pay for a two-year highway program, but also notes a need for up to $2.4B in additional revenues to support the transit program through FY'13.

This week, seven of the 11 Republican members of the Senate Finance Committee wrote a letter to Chairman Max Baucus recommending a variety of options to pay for the funding gap. Their recommendations include rescission of funds provided for DOE's embattled Advanced Technology Manufacturing Loan Program (approximately $3.5B), transfer of funds from the Leaking Underground Storage Tank Trust Fund (approx $3B), reclamation of Highway Trust Funds transferred to the Land & Water Conservation Fund and redirection of Outer Continental Shelf receipts (approx $250M a year), expanded oil and gas exploration in Alaska and the Outer Continental Shelf (approx. $5.2B over 10 years), and rescission of various unspent federal funds. They do not support a gas tax increase.

The Republican Senators also recommend ways that highway funds could be spent more efficiently such as by repealing or relaxing Davis-Bacon requirements They also note that a two-year bill is not sufficient to meet the needs of the program and they urge the start of a discussion of a longer term plan. No word yet on Chairman Baucus' response. EPW Chair Barbara Boxer (D-CA) said she is very encouraged that these key Senators are engaged and weighing in even though many of the recommendations are very controversial. Boxer suggested there is a slight possibility that the $12B funding fix could be included in the year-end tax extenders bill.

FAA Authorization

As of yesterday, it appears that all the remaining issues holding up passage of a multi-year FAA authorization bill have been resolved except for one - a very controversial union mediation issue which has now been passed up to House Speaker Boehner and Senate Majority Leader Harry Reid to resolve. There is still hope that the bill could be finalized before Congress adjourns for the year, but that may not be possible. The current short-term FAA extension expires on January 31, 2012, which leaves very little time to complete a bill. Earlier this fall, Chairman Mica said he would not support another short-term FAA bill after Congress passed the 22nd extension. In other aviation news, FAA Administrator Randy Babbitt resigned this week following a DUI arrest. No word yet if the Administration will nominate a replacement for the fixed five-year term, which requires Senate confirmation, before the election.

High Speed Rail

Earlier this week, House T&I Committee Chairman John Mica held an oversight hearing on high-speed rail, entitled "The FRA's High-Speed Intercity Passenger Rail Program: Mistakes and Lessons Learned". Here is a link to a committee background memo on the issue, a video of the hearing and the witness testimony. Secretary Ray LaHood testified on behalf of the Administration and provided a vigorous defense of the program. In general, Republican members of the Committee severely criticized the Administration's HSIPR program, in particular for spreading funds around to numerous projects instead of funneling the bulk of the money to the Northeast Corridor which has proven ridership.

The Committee will hold another hearing next week on December 15 specifically on the California high-speed rail project.

TIGER Grants

US DOT Secretary Ray LaHood announced that once again the demand for TIGER discretionary grants has been overwhelming. DOT received over $14B in requests for the $527M available for the TIGER III program representing 828 applications from all fifty states. DOT has announced that they plan to expedite award of the TIGER grants and name the recipients before the end of 2011.

FHWA FY'12 Discretionary Program Grants

As previously reported, FHWA has announced the solicitation for its FY'12 discretionary programs. Applications are due by January 6. These are funds which had traditionally been earmarked by Congress in the annual appropriations bills but are now subject to a competitive selection process. Each of the 12 programs has its own eligibility and selection criteria. Here are links to each program along with the approximate nationwide amount available:

Interstate Maintenance, $47.3 million
Transportation, Community, and System Preservation, $29 million
Ferry Boats and Terminals, $22.2 million
Rail Highway Crossing Hazard Elimination in High Speed Rail Corridors, $7.1 million
Truck Parking Facilities, $2.9 million
Public Lands Highways, $45 million
National Scenic Byways, $20.6 million
Highways for LIFE, $9.5 million
Innovative Bridge Research and Deployment, $4.2 million
National Historic Covered Bridge Preservation, $4.7 million
Value Pricing Pilot Program, $6.9 million
Delta Region Transportation Development, $4.7 million

November 18, 2011 Update

Once again, this has been a very busy week for infrastructure/transportation news. Congress passed and the President signed the FY'12 appropriations "minibus" bill which includes annual funding for US DOT programs; House Speaker John Boehner announced the introduction of HR 7, the "American Energy & Infrastructure Jobs Act", which would authorize surface transportation programs for five years; and House and Senate committee leaders met to continue, and hopefully quickly complete, negotiations on the multi-year FAA authorization bill that expires on December 31. The House and Senate will be on recess next week for the Thanksgiving holiday, but SuperCommittee members will continue to work in advance of the November 23 deadline to issue their deficit reduction recommendations.

Surface Transportation Reauthorization

Yesterday morning, House Speaker John Boehner (R-OH), accompanied by House T&I Committee Chairman John Mica (R-FL), made a major announcement regarding moving a surface transportation bill before the end of 2011. The bill, HR 7, the "American Energy & Infrastructure Jobs Act", would authorize surface transportation programs for five years and be funded in part by revenues from fees and royalties from expanded oil and gas exploration and drilling. While the Speaker's announcement is good news for potential quick passage of a multi-year authorization bill, the proposed revenue source to cover the shortfall in Highway Trust Fund revenues is a non-starter for many Members, including Senate EPW Chair Barbara Boxer (D-CA) and House T&I Committee Ranking Member, Rep. Nick Rahall (D-WV).

The Speaker did not release the text of HR 7 or many details about the bill. He primarily reiterated the points Chairman Mica has previously made about his proposal - speeding up the project delivery process by consolidating the permitting process, eliminating needless programs, leveraging private sector dollars, and banning earmarks. No mention was made of specific funding levels although the press release says that "the measure provides responsible infrastructure funding". In the past, the Congressional Budget Office (CBO) has scored the potential new revenue from such energy sources at only about $1B a year, far short of what would be needed to fund even current levels of highway and transit funding. It remains to be seen whether this latest plan will support more generous revenue estimates, as well as how these revenues would flow into the Trust Fund.

Here is a link to Chairman Mica's press statement, a link to Speaker Boehner's statement and a link to House T&I Ranking Member Rahall's statement.

FY'12 Appropriations

Congress has passed the FY'12 DOT Appropriations bill as part of a three-bill "minibus" and the President signed the bill late this afternoon. The bill also includes an extension of the current Continuing Resolution (CR) which will fund all remaining federal agencies through December 16. The current CR expires at midnight tonight. Since the US DOT bill, along with the Agriculture and Commerce/State/Justice bills, have been completed, they will no longer be part of the CR. This "minibus" is the first and only FY'12 appropriations bill to be completed by Congress.

The final version of the FY'12 DOT appropriations bill, HR 2112, is much closer to the higher funding levels included in the Senate version of the bill than to the House bill which included severe cuts of as much as 34% for highway and transit programs. Passage of these higher levels signals that House Republicans have abandoned their plan for significant funding reductions as proposed by the earlier FY'12 House Budget Resolution.

Program	FY'11 Enacted Level	House FY'12 Level	Senate FY'12 Level	Final Conference Level
FHWA Obligation Limitation	$41.1B	$27.0B	$41.1B	$39.14B
Transit - Total	$10.0B	$7.0B	$10.6B	$10.5B
Transit - New Starts/Small Starts	$1.6B	$1.55B	$1.95B	$1.95B
Transit - Formula and Bus	$8.3B	$5.2B	$8.3B	$8.36B
Amtrak - Capital/Debt Service	$922M	$899M	$937M	$952M
Amtrak - Operating	$562M	$227M	$544M	$466M
High Speed Rail	$0	$0	$100M	$0
Airport Improvement Program	$3.51B	$3.33B	$3.5B	$3.35B
TIGER Grants	$528M	$0	$550M	$500M
National Infrastructure Bank	$0	$0	$0	$0

Highlights of the FY'12 DOT Appropriations bill include:

A highway obligation ceiling of $39.14B, down from the FY'11 level of $41.1B, but in line with the authorized level included in the current SAFTEA-LU extension. The House bill had proposed a severe cut down to $27B. The appropriators did note that the higher level agreed to cannot be sustained in future years without new revenue.
Inclusion of language restricting FTA from signing New Start FFGAs for projects with over a 60% federal share. This is less than the authorized level of 80%, but higher than the 50% maximum federal share included in the House bill. The 60% limit is the same that has been applied in previous appropriations bills.
Retention of Senate bill language to fund $188M of Small Starts BRT projects from the FTA Bus and Bus Facilities program rather than from the New Starts program, thus crowding out other potential discretionary bus grants by the Administration. This effectively amounts to funding the New Starts/Small Starts program at $2.18B.
No FTA TIGGER greenhouse gas or energy reduction funding.
No High-Speed Rail funding- not even the very modest $100M included in the Senate bill.
Over $1.36B in specific project allocations for 13 FTA New Start projects with FFGAs and $510M in unallocated funds for five light rail projects with pending or recommended FFGAs. Most of the FFGA projects were cut below the requested level, but FTA's requested amounts per project were particularly large for FY'12.
Other than the New Start FFGA and BRT allocations, no highway or transit project earmarks.

The legislative text of the FY'12 DOT Appropriations bill (Division C) can be accessed here. beginning on page 225 of the document. The explanatory text of the joint statement of managers can be accessed here beginning on page 179 of the document.

SuperCommittee

The congressional SuperCommittee, which has been tasked with cutting the federal deficit by at least $1.2 trillion over ten years, has until next Wednesday, November 23 to finalize and approve its recommendations. Seven of the 12 bi-partisan members must approve the recommendations. If approved, the recommendations would then go to the full Congress where both the House and Senate must vote to approve the report before December 23. The recommendations cannot be amended or filibustered. If the Supercommittee or the full Congress fails to approve the recommendations, there will be an across-the-board cut or "sequestration" starting on January 1, 2013 on all federal programs, including defense programs.

The Supercommittee has revealed few details of its deliberations. Despite encouragement from some sources to "go big" and some movement by key Republicans to put tax reform on the table, the outlook does not currently look too promising for an agreement to be reached by the deadline.

Other News

In personnel news, Karen Hedlund has been named to be the FRA Deputy Administrator to replace Karen Rae who has joined NY Governor Cuomo's administration. Karen Hedlund was previously the FRA Chief Counsel and before that the FHWA Chief Counsel. US DOT Undersecretary Roy Kienitz has announced that he will be leaving DOT in early December to start his own consulting firm.

House T&I Committee Chairman John Mica recently announced that he is dropping his effort to privatize Amtrak, particularly the Northeast Corridor (NEC) in the face of strong opposition from Amtrak, elected officials in the region and labor. In addition, he indicated he will work to transfer any unspent federal high-speed rail funds to the NEC.

FHWA has announced a solicitation for FY'12 funding for 12 discretionary highway programs. FHWA will allocate funding for the first six-months of FY'12 (through March 31, 2012) as authorized by the current short-term SAFETEA-LU extension. Programs include Interstate Maintenance, TCSP, Value Pricing, National Scenic Byways, and Rail Highway Grade Crossing Elimination. Applications are due by January 6, 2012. Here is a link to the FHWA announcement.

In the November 3 Federal Register, US DOT announced a new fixed-date solicitation process to be used to evaluate and select projects to receive loans and lines of credit through the TIFIA financing program. Rather than the previous rolling application process, applicants must now apply for the $110M in FY'12 TIFIA credit assistance by December 30, 2011. Previous year's letters of interest must be resubmitted if applying for FY'12 funding. Here is a link to the Federal Register notice.

November 7, 2011 Interim Update

Late in the day on Friday, November 4 the Senate Environment & Public Works Committee (EPW) released its bi-partisan, two-year highway reauthorization bill, MAP-21. The bill is scheduled to be acted on by the EPW Committee on Wednesday, November 9 at 10:00AM.

Here is a link to an EPW summary of the bill - 4 pages.

Here is a link to the full text of the bill - 600 pages.

The Senate bill funds highway programs for two years - FY'12 (which began on October 1, 2011) and FY'13 at essentially current FY'11 funding levels with a modest inflation factor. Before the bill can go to the Senate floor, the Finance Committee must act to identify approximately $12B in offsets to pay for the cost of the bill over and above what Highway Trust Fund revenues are estimated to cover. The Finance Committee has yet to identify what the potential offsets may be. Transit, rail and safety issues will be dealt with by the Banking and Commerce Committees in the near future and then combined with the EPW highway title on the Senate floor.

The Senate EPW bill would:

Consolidate federal highway programs from about 90 currently to less than 30 programs.
Eliminate all project earmarks.
Create a new program called "America Fast Forward" which would, among other things, greatly increase the size of the TIFIA loan financing program to $1B per year.
Create five core highway programs - National Highway Performance Program (consolidates the Interstate Maintenance, NHS and Bridge programs), Transportation Mobility Program (replaces the STP program), National Freight Network Program, CMAQ (incorporates the Transportation Enhancement program), and Highway Safety Improvement Program.
Establish several additional programs including an expanded TIFIA program, an expanded Projects of National and Regional Significance Program, Emergency Relief Program, and a Federal Lands and Tribal Highways Program.
Accelerate project delivery including streamlining the NEPA process.
Make no changes to the current tolling provisions.

November 4, 2011 Update

This has been a busy week for transportation news in Washington, DC, only some of it positive. The House will once again be on recess next week. The deficit reduction SuperCommitee continues to meet in an effort to find a way to cut at least $1.2 trillion from the federal deficit over ten years. Their deadline is November 23. There appears to be some movement to put revenue increases on the table, in addition to entitlement reform and program cuts, despite previous strong opposition by Republicans. There is also growing pressure on the committee to think big, be bold and produce a true game changing proposal. Some optimists even think it might be possible that such an overarching plan could include a robust, multi-year surface transportation bill and the necessary revenues to fund it.

FY'12 Appropriations

Earlier this week the full Senate passed the FY'12 appropriations "minibus" bill which includes the annual FY'12 funding for US DOT programs. House and Senate conferees held an initial, formal meeting to resolve the differences in the two bills last night. This is despite the fact that the House THUD (DOT) appropriations bill has never been passed by the full House or even the full Appropriations Committee. However, the legislative vehicle for the "minibus" is the FY'12 Agriculture bill which has passed the full House. The bill is moving quickly because Congress wants to use the "minibus" as the vehicle for another Continuing Resolution (CR). The current FY'12 CR runs out on November 18. With the House on recess next week, Congress is running out of time to pass another government-wide funding bill to avoid a government shutdown. The new CR is expected to extend until mid-December or into mid to late January.

The House and Senate versions of the FY'12 DOT appropriations bill differ greatly with the Senate bill funding most DOT programs at significantly higher levels than the House bill.

Program	FY'11 Funding	FY'12 House Subcommittee	FY'12 Senate Full committee
FHWA Ob Limit	$41.1B	$27B	$41.1B
FHWA ER	$0	$0	$1.5B
FTA Formula/Bus	$8.3B	$5.2B	$8.3B
FTA New Starts	$1.59B	$1.55B	$1.95B
TIGER	$527M	$0	$550M
Nat'l Infrast Bank	$0	$0	$0
High Speed Rail	$0	$0	$100M
Amtrak Operating	$562M	$227M	$544M
Amtrak Capital/Debt	$922M	$899M	$937M
Airport Improvement Program	$3.5B	$3.3B	$3.5B

The Senate plans to start debate on a second "minibus" appropriations bill which would combine the Energy & Water (funding for the Corps of Engineers), Financial Services, and State-Foreign Operations bills.

Surface Transportation Authorization

Yesterday, the full Senate defeated two transportation bills, but neither had been expected to pass. Both bills required 60 votes to pass and there were problems with the offsets to pay for both bills. The first bill was the $60B transportation piece of the President's American Jobs Act (AJA). It was defeated 51 to 49. The offset to pay for the bill was a surtax on millionaires which Republicans strongly oppose. Last week the Senate defeated AJA funding for teachers and first responders for the same reason. The second bill was a Republican response to the AJA, a hastily introduced bill by Senator Orin Hatch (R-UT), which was defeated 47 to 53. The bill included an unusual mix of issues with the centerpiece being an extension of the existing short-term SAFETEA-LU bill (which expires on March 31, 2012) until September 30, 2013 - essentially a "two-year" reauthorization at current funding levels without any program reforms. However, the bill also included the EPA Regulatory Relief Act, the Cement Regulatory Relief Act and a Senator Rand Paul (R-KY) regulatory relief bill which would require Congress to affirmatively approve all proposed Administration regulations. The Republican bill also included $40B in offsets by delegating power to OMB to rescind that amount from any domestic discretionary programs across the federal government.

The Senate EPW Committee is scheduled to mark-up the committee's two-year highway authorization bill next week on November 9. A copy of the bill is expected to be made public shortly. There is still no word from the Finance Committee on offsets to pay for the $12B gap in funding and the bill is reportedly drafted with a fallback provision allowing for program cuts if needed to stay within existing resources. The EPW bill is expected to include substantial program reforms. Assuming EPW proceeds with the mark-up next week, it is expected that the Banking (transit) and Commerce (safety and rail) Committees will act soon after on their titles of the authorization bill.

Yesterday, House Speaker John Boehner (R-OH) made a statement that he plans to introduce a transportation/energy authorization bill which he expects the House to pass before the end of 2011. He proposes to fund a "current level" (as yet undefined), multi-year surface transportation authorization bill by closing the gap in Trust Fund revenue with revenue from new domestic oil and gas exploration. This is a highly controversial issue which many Democrats and the environmental community strongly oppose. Senator Boxer has already spoken out against this idea. Also, such a proposal would move Trust Fund financing even further away from the traditional user fee concept. In addition, much of the potential new revenue would not flow immediately which might require the federal government to have to bond against future revenue.

President Obama Transportation Directive

President Obama held a press conference on Wednesday in DC on the subject of transportation. It took place at Key Bridge in Georgetown. At the event he announced that:

1) US DOT will award $527M in competitive TIGER grants by the end of 2011 - months ahead of schedule.

2) US DOT will shorten the application process for the 2012 round of TIFIA innovative financing. The annual funding level of $110M in TIFIA funds is estimated to support projects totaling up to $3B in construction.

3) US DOT will establish a Transportation Rapid Response Team to expedite reviews of surface transportation projects. Co-chaired by the Council on Environmental Quality and US DOT, the team will identify and implement best practices to improve the transparency, efficiency and effectiveness of environmental review and permit decisions for transportation projects, protect public health and put Americans back to work.

The White House also released a 20 page report titled "Recent Examples of the Economic Benefits from Investing in Infrastructure," which includes the Woodrow Wilson Bridge in Maryland, Virginia, and D.C.; the O'Callaghan-Tillman Memorial Bridge and Hoover Dam Bypass in Arizona and Nevada; the I-10 Twin Span Bridge replacement in New Orleans, La.; the Ocean City Causeway in New Jersey; the Manchester Airport Access Road in New Hampshire; the "Fort to Port" corridor in Indiana and Ohio; the J.F.K. Airport Runway Reconstruction in New York; the Big I project in Jacksonville, FL.; U.S. Route 17 in South Carolina; the Green Line light rail extension in Portland, OR.; the Mid-Jordan Transit Corridor Light Rail Project in Salt Lake City, Utah; the light rail extension in Dallas, TX; I-77 rehabilitation in North Carolina; runway rehabilitation in Nashville, TN; the Heartland Corridor Clearance Project; the CREATE program in Chicago, IL; and light rail projects in Seattle, WA. To read the report, click here.