Pending budget cuts from last week’s deal to avert a government shutdown will take a deeper bite out of transportation funds, but industry and government sources say the ones that could most affect freight-related projects won’t disrupt current programs.
Out of that accord, the House Appropriations Committee’s continuing resolution to fund federal agencies through the end of September eliminates all new 2011 funding for the Department of Transportation’s High Speed and Intercity Passenger Rail program, and reaches back into past-year approvals to rescind $400 million not already spent.
On paper that cuts a total of $2.9 billion from a grant pool used to invest in track and signal improvements that mostly upgrade freight rail corridors to handle new or added Amtrak passenger service. Program administrators say freight operations benefit as well from the added capacity and reductions in road crossings over train tracks.
However, the cuts will come from money the DOT was accruing but had not used. So far, the department has still been administering grants from the 2009 stimulus and the 2010 budget, but had not yet tapped into 2011 funds.
Last weekend, another $1.5 billion was cut in extra funds building up at the 2010 budget level, when Congress okayed $2.5 billion for new intercity passenger rail grants. President Obama had only requested $1 billion for 2011, but the extra buildup came because Congress had so far allowed that account to keep growing at last year’s pace.
The cuts do not pull back any of the money already committed by the DOT to specific rail projects, but it slices $400 from the $2.43 billion the DOT made available for other applicants after Florida rejected a grant-funded project to build a bullet train service. Requests totaling $10 billion worth of projects came in by the April 4 deadline..
The deal, which is subject to congressional votes this week, would also cut $630 million from old earmarks tailored to specific highway or bridge projects that never went forward, plus another $2.6 billion in highway program contract authority. From that, “there is no effect on spending” for road programs paid for out of the Highway Trust Fund, said a Federal Highway Administration source, since the cuts are in extra spending authority “but not funds in hand.”
Additional cuts are targeted in transit accounts and in a discretionary grant pool the DOT has used for freight projects. That “TIGER” grant account was also building up this year at the same $600 million pace as in 2010, but the DOT had not begun to offer any of that 2011 grant money to project applications as it awaited final decisions on this year’s budget.
While the budget agreement removes some funds the DOT might have used this year, the department’s focus has already shifted more toward the next multi-year surface transportation bill that House and Senate committees are starting to develop.
The administration is asking for the bill to make a sustained commitment to the intercity passenger rail program, and create a large infrastructure bank that could issue grants or loans to a broad range of transportation projects.