October 2, 2009

RE: Federal Transportation Funding Update

Dear Mayor:

As mentioned in our letter of September 16 (www.njslom.org/ml091609_road.html) the current Federal Transportation funding program, SAFETEA-LU, was set to expire on September 30th. (See our letter of August 6 for details on the difference between the House and Senate approaches to transportation policy. www.njslom.org/ml080609-ftf.html.) 

Late Wednesday evening, the Senate passed (62 – 38) a budget resolution that included a one-month extension of existing highway programs.

The resolution was an agreement between House and Senate appropriators that allows those federal departments whose FY 2010 budgets have yet to receive Congressional approval to continue operating.

Some Senators objected to a proposal to extend surface transportation programs for three months and repeal the rescission of previously enacted budget authority, set to take effect Thursday. A sticking point in repealing the $8.7 billion rescission written into the 2005 SAFETEA law was the need to find offsets under pay-as-you-go budget rules. Several states already had plans to spend their share of the $8.7 billion budget rescission, anticipating that it would be repealed, and may have to cancel or delay the projects.

Senate Environment and Public Works Chairwoman Barbara Boxer worked out a deal with ranking Republican Senator James M. Inhofe to offset the extra highway spending by tapping the Troubled Asset Relief Fund (TARP). Nebraska Senator Mike Johanns objected on behalf of Louisiana Senator David Vitter, who opposed the idea of using TARP money to fund State transportation priorities.

Even if the Senate passed its bill, there was virtually no way that the House, which had already finished voting for the day, could have taken it up Wednesday night. The House already passed a three-month extension that left the rescission in place.

The Senate and the House will now have one month to determine how long to extend surface transportation law, and how to fund that extension.

For more information, contact Jon Moran at 609-695-3481, ext. 121.

Very truly yours,

William G. Dressel, Jr.
Executive Director