States won a limited reprieve in December in their struggle to preserve the amount of federal funds they can authorize for transportation projects, and they could add $12 billion if the Senate acts quickly on a new jobs bill, according to the American Association of State Highway and Transportation Officials.
Janet Oakley, AASHTO director of policy and government relations, said that the Defense Department appropriations bill that President Obama signed on Dec. 19 will allow states to obligate federal highway money at an annual level of $30 billion through the end of February.
If the Senate approves the “Jobs for Main Street” bill in the next two months, Oakley said states’ authority will return to the $42 billion level originally provided in the SAFETEA-LU transportation program through the end of fiscal 2010. The House passed the jobs bill by a slim margin on Dec. 16.
SAFETEA-LU authorized states to obligate federal money for infrastructure projects up to a total of $42 billion per year, but the bill had a provision that rescinded some $12 billion in funds not yet obligated at the end of fiscal 2009.
Oakley said that if the Senate doesn’t approve the jobs bill before March 1, the Congressional Budget Office will fix states’ allotment at $30 billion. To get the additional $12 billion, Congress will have to find an equal amount in budget offsets.
The ideal solution to the states’ dilemma is for Congress to replace SAFETEA-LU with a new six-year transportation spending plan, Oakley said. The House has a plan in the works, and the Senate is expected to propose a bill early this year. The principal impediment is finding the money to pay the $500 billion price.
“We all want there to be a long-term, multi-year bill for stability and continuity in the program,” Oakley said. “The big question is how you pay for it.”
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