Foxx hints at highway patch veto

Anne Wernikoff

Transportation Secretary Anthony FoxxAnthony FoxxFeds funnel nearly M toward DC Metro safety efforts Railroads slow to adopt technology that prevents accidents Smarter transportation Is just what the doctor ordered MORE hinted Wednesday that President Obama might veto a temporary highway funding extension if Congress passes one this month. 

Lawmakers are scrambling to beat a July 31 deadline for the expiration of federal transportation funding, and they have been unable to come up with a way to pay for a long-term extension of the infrastructure spending. 

Foxx said Wednesday that Obama is going to wait to see what Congress produces, but he said the president is running out of patience with temporary transportation funding extensions that have been the norm for the last decade. 

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"I think we're quickly getting to the point where the value of another extension may be less than the value of breaking the cycle," he told reporters.

"The president speaks for the president," he continued. "I think if you look at the Statement of Administration Principles that was put out around the last extension, you can see that I think the patience level is running low."    

Foxx said he is going to "withhold a final judgment" until he sees what Congress produces later this month, but he said the temporary road funding patches that have been passed by lawmakers in recent years are preventing states from completing badly-need construction projects.

"The system is falling apart," he said. "I will tell you that at current funding levels and with the spate of short-term extensions we've had, we're damaging the system." 

Obama has complained about previous temporary highway extensions, but he has ultimately signed them to prevent an interruption in the nation's spending on road and transit projects.

Foxx said Wednesday that Obama might take a different tack later this month if Congress presents him with another patch.

"I'm telling you that we've got to break to cycle," he reiterated when he was asked if he would recommend that President Obama veto a short-term highway funding extension this month. 

"What we're doing right now is not fair to future generations and frankly, it's not fair to people who are on the roads now," Foxx continued. 

Congress has been grappling since 2005 with a transportation funding shortfall that is estimated to be about $16 billion per year, and lawmakers have not passed a transportation bill that lasts longer than two years in that span. 

The 18.4 cents per gallon federal gas tax has been the main source of transportation funding for decades, but it has not been increased since 1993, and more fuel-efficient cars have sapped its buying power.

The federal government typically spends about $50 billion per year on transportation projects, but the gas tax only brings in approximately $34 billion annually. 

Lawmakers have turned to other areas of the federal budget to close the transportation funding gap in recent years, resulting in temporary fixes Foxx is now criticizing.  

The Obama administration has proposed a measure that calls for spending $478 billion over the next six years on the nation's roads and bridges, but lawmakers have largely ignored the suggestion. 

The Obama plan would supplement gas tax revenue with a process that is known as "repatriation," which would tax corporate profits being held overseas at a 14 percent rate.

Republicans have said they are open to the president's repatriation idea, but they have said the taxes should be collected at a lower rate and on a voluntary basis in the form of a "tax holiday" for companies that return profits to domestic banks. 

Other transportation advocates are pushing for a gas tax increase to pay for a long-term transportation bill, but Republican lawmakers have ruled out a tax hike

The non-partisan Congressional Budget Office has estimated it will take about $100 billion, in addition to the gas tax revenue, to pay for a six-year transportation funding bill.

Foxx said Wednesday that lawmakers should summon the political will to find the money. 

"Unfortunately transportation has gotten tied up in this anti-spending culture," he said. "But you can't have a strong transportation system without spending." 

Foxx said his department is preparing to warn states that they will have to cut back on payments for construction projects at the end of the month unless Congress reaches an agreement on an extension. 

"We're undertaking steps now to begin notifying states," he said of the so-called "cash management procedures" that are implementing when the highway fund dips below $4 billion. 

"I think within days, we'll send the letter out," Foxx said.