No gridlock: Highway deal nears

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House and Senate committees both approved measures on Thursday to fund highway projects into next year, raising hopes that Congress could soon reach a deal to prevent sidelining construction projects this summer.
 
The two measures rely on similar provisions to provide roughly the same amount of money — just under $10 billion — for highway projects.
 

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In agreeing to that approach, Senate Democrats also bowed to pressure from the House GOP, which has been pushing to extend funding through next May.

Democrats had sought a shorter-term deal that would have only extended funding until shortly after November’s election, a time frame they thought would give Congress the best chance to hash out a long-term transportation agreement.

But even though the two chambers appear to have the contours of a deal, both Senate Finance Chairman Ron Wyden (D-Ore.) and House Ways and Means Chairman Dave Camp (R-Mich.) sought the political high ground on Thursday ahead of final negotiations.

With just three working weeks left before they break for August, lawmakers are racing to find a temporary solution to keep the federal Highway Trust Fund from going bankrupt.

Without action by Congress, the Transportation Department has warned it would have to begin cutting payments to state and local governments for road repairs on Aug. 1, potentially halting transportation projects across the country.

At a morning mark-up of his measure, Camp derided the Senate approach for trying to wring more revenue out of tax compliance, saying the House GOP wouldn’t approve new taxes to pay for more spending, or give an IRS dogged by controversy more power.

His plan, Camp said, contains “the only policies that will pass both the House and Senate in time to fund the trust fund after the end of this month.” 

“So I see no reason why we cannot work to get this done right away,” Camp said.

Both the Senate and the House measure rely on so-called “pension smoothing” — a proposal that budget experts across the ideological spectrum have dubbed a gimmick — and boosting customs user fees to extend highway funding.

But the Senate proposal squeezes less money out of both those policies, and adds a variety of other measures, such as requiring more information about home mortgage interest, that would raise revenues by increasing tax compliance.

Those compliance measures allowed both Wyden and the Finance panel’s top Republican, Sen. Orrin Hatch (Utah), to claim victory, given that new tax revenues often frowned upon by the GOP.

Wyden said after the Senate’s afternoon mark-up that conservative groups like Grover Norquist’s Americans for Tax Reform had no issue with the compliance measures, which make up about 40 percent of the Senate’s offsets.

The Oregon Democrat also said that, unlike the House, he had cobbled together a bipartisan bill with Hatch, despite the fact that Camp’s measure passed Ways and Means by voice vote.

“I think it’s pretty clear that what was voted on today was not some big push to raise people’s taxes,” Wyden said.

The Finance Committee also passed its highway measure by voice vote, though Sen. Tom Carper (D-Del.) was an audible no vote.

Before that, the committee narrowly defeated — by a 14 to 10 vote — Carper’s effort to only approve enough funds to get the trust fund to the lame-duck session.

Carper and Sen. Chuck Schumer (N.Y.), a member of Democratic leadership, commiserated about their proposal falling short after the mark-up. Wyden said after the Finance mark-up that he couldn’t predict for how long his bill would extend highway funds, even though the measure offers about the same amount of funding as the House.

“We’ve greatly reduced the likelihood that we’ll summon the courage to do what all know needs to be done,” said Carper, who backs raising the gas tax.

Sen. Barbara Boxer (D-Calif.), the chairwoman of the Environment and Public Works Committee, said she would still work to enact a December deadline for highway funding, despite the deal worked out by Wyden and Hatch.

Camp and Speaker John Boehner (R-Ohio) have both said they’d oppose any efforts to increase the gas tax after the election to help pay for a broader transportation deal.

The House Rules Committee announced Thursday that it would consider the highway proposal on Monday, fulfilling Boehner’s pledge to put a bill on the floor next week.

The Highway Trust Fund is used to make repairs to the nation’s roads and bridges, and is infused with cash by the federal gas tax, which is 18.4 cents per gallon. The tax hasn’t been raised in 21 years, and is not bringing in enough money to pay for necessary fixes around the country. The shortfall has become worse in recent years as cars have become more fuel-efficient.

The result has been a shortfall in federal transportation spending that budget analysts estimate runs to about $16 billion per year.

The gas tax typically brings in about $34 billion per year, compared with $50 billion in annual road and transit spending.

Transportation advocates have said the current funding level is the bare minimum Congress can spend on infrastructure projects to maintain the nation’s road and transit systems, and they have pushed for the first gas tax increase in two decades to close the funding gap.
 
Obama administration officials have said a bankruptcy in the Highway Trust Fund would result in a 28 percent cut in transportation funding to states and cost the U.S. 700,000 jobs.

But conservative groups such as the Heritage Action foundation have argued that the Obama administration is overstating the impact of federal transportation funding on state and local projects.

Either way, lawmakers from both parties said Thursday that they thought a deal was in reach.

“I think the bills are really quite similar,” Hatch said after the hearing, before adding that he understood why House Republicans were skeptical of the Senate’s tax compliance proposals. 

Sen. Ben Cardin (D-Md.) added that “we’re pretty close, and I think we should be able to work out the differences.”

“If you put our bill on the floor of the House of Representatives, I think it would pass overwhelmingly,” Cardin said.

— This story was updated at 6:52 p.m.