The House this week approved an omnibus appropriation bill to fund government programs through the remainder of FY 2009. The 110th Congress was unable to complete action last year on most of the FY 2009 appropriations bills and instead passed a stopgap continuing resolution funding programs at 2008 levels through March 6, 2009. The omnibus bill funds the highway program at $40.7 billion the SAFETEA-LU authorized level. This is slightly less than FY 2008 because there was an additional $1 billion provided last year to address emergency bridge repairs. The transit program is increased to $10 billion, the authorized funding level, which is a 7 percent increase over 2008. The Airport Improvement grants remain at $3.515 billion, the same as 2008. 

President Obama has released his proposed federal budget "framework" for fiscal years 2010 and beyond.  The document is not a detailed line item budget proposal but rather, in many areas, presents aggregate funding levels and some policy initiatives and priorities. The detailed budget is expected to be released in April.The overall US DOT funding level requested is $72.5 billion about $1.8 billion more than the $70.7 billion appropriated in FY 2009, an increase of 2.5 percent. Highway and transit funding levels are not specified. The document points out that the current framework for financing and allocating surface transportation investments is not financially sustainable and pledges to work to correct this situation and will emphasize the use of economic analysis and performance measurement in transportation planning. A key point of concern, however, is a proposal to change the budget treatment of the Highway Trust Fund that would change project funding from a multi-year authorization to an annual appropriation. This would be very disruptive to the program and a policy change that will be opposed by the transportation community.The budget also highlights high speed rail as a top Administration transportation priority. The document proposes a five-year $5 billion high speed rail state grant program. This is in addition to the $8 billion included in the recently enacted economic stimulus legislation.

The Highway and Utilities Contractors Issues Meeting took place Feb 6 and 7. Over 120 contractors came to La Quinta, Calif., for discussion of the issues that affect their particular markets and to hear presentations from some of the leading experts in the field.Topics included materials prices and availability for asphalt and steel, the national implications of the California Air Resources Board's Off-Road Diesel Emissions limits and the political outlook for the economic stimulus package, SAFETEA-LU reauthorization and the Water Trust Fund. Scott Williams and Don Weaver, chair and vice-chair respectively of the Highway & Transportation Division, presided over the first day of activities, which included sessions on worker visibility standards and public works financing troubles. Brad Barringer and Art Daniels, Municipal & Utilities Division Chair and Vice Chair, presided over the second day, which included sessions on ethics and compliance programs, Florida's success with dispute resolutions boards, and OSHA's crane operator standard.For more information, contact Scott Berry at (703) 837-5368 or berrys@agc.org.

Congress is poised to complete action on economic stimulus legislation, HR 1, The American Recovery and Reinvestment Act of 2009. The House passed the bill 246-183 earlier today and the Senate is scheduled to vote tonight. All three GOP Senators who voted for the Senate version of the bill (Specter, Snowe and Collins) have pledged to vote for final passage.The Act includes a total of $787.2 billion in spending and tax cuts.The bill includes $47.8 billion in transportation funding as follows:$27.5 billion for high & bridge formula funding$1.5 billion for discretionary competitive grant program for surface transportation$8.4 billion public transportation$850 million Amtrak capital grants$450 million Amtrak security upgrades$8 billion for construction of high speed and intercity rail projects$1.1 billion Airport Improvement GrantsThe House Transportation and Infrastructure Committee provided the attached chart which shows a state by state and metropolitan area breakdown of the highway, transit and clean water state revolving funds included in the bill.There are numerous tax provisions to encourage development, capital investment, and increasing certain bonding opportunities on public buildings, schools and other public works.  The attached chart provides an overview of the specific tax provisions that AGC has worked to have included in this bill.  A top AGC objective has been full repeal of the 3% withholding on contractor payments by public agencies. AGC was successful in having a one year delay included in this bill and will continue to work for total repeal.AGC was also successful in having a House bill requirement removed from the final bill that would have only allowed companies that use E-verify to be eligible to compete for projects funded under the bill.

House and Senate conferees last night agreed to a $789 billion economic stimulus bill that includes funding for transportation infrastructure programs. The House will vote on the compromise tomorrow and the Senate soon after. While the actual legislative language is not yet available summaries of the agreement have been released. AGC's CEO Steve Sandherr participated in a conference call this morning with Transportation Secretary Ray LaHood who gave the following details concerning transportation funding. $27.5 billion for high & bridge formula funding (below the $30 billion House)$1.5 billion for discretionary competitive grant program for surface transportation (Senate proposed $5.5 billion)$8.4 billion public transportation (below $12 billion in the House)$850 Amtrak capital grants (USDOT), $450 million Amtrak security upgrades (DHS)$8 billion for construction of high speed rail projects (increase from $2 billion in Senate bill)$1.1 billion Airport Improvement Grants (less than $3 billion in House)The "use or lose" deadline for states to obligate the first 50 percent of their apportionment was set at 120 days, a compromise between the 90 day House limit and 180 day Senate limit. Unobligated funds from the first 50 percent will be redistributed to states that have used their funds. All of the funds must be obligated one year after enactment, as was proposed in the Senate. It is unclear what happens to the unused second portion of the funds. The House bill redistributed these funds to the states, the Senate bill puts these unobligated funds in the new discretionary grants program.Secretary LaHood pointed out that the big increase in funding for high speed rail reflects President Obama's desire to build a national high speed rail network.Secretary LaHood also reported that he and White House Chief of Staff Rahm Emanuel met yesterday with state DOT heads from around the country to emphasize the need to put this funding to work immediately. LaHood also reported that he has established a high level team within US DOT to monitor the use of these funds and to work with states to eliminate any road blocks to contract awards.Secretary LaHood also indicated that he views this funding as only a first step in addressing transportation infrastructure needs and that reauthorization of SAFETEA-LU before September 30, 2009 is a priority. He said he has already met with House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-MN) who committed to meeting that deadline.

By a 61-37 vote, the Senate today passed its $838 billion economic stimulus bill after adopting the compromise amendment offered by Sens. Susan Collins, (R-Maine) and Ben Nelson (D-Neb). Sens. Olympia Snowe of Maine and Arlen Specter of Pennsylvania joined Collins as the only Republicans to vote for the bill. The bill will now go to a conference committee to work out the differences between the House and Senate versions. While the goal of the Democratic leadership is to have a final bill by the end of this week, the significant differences in the two measures will make that timeline difficult to meet. While there were numerous amendments in the Senate related to increasing highway, bridge, transit and other transportation funding, in the end, the amounts for these programs were left unchanged from the figures included by the Appropriations Committee. A comparison of the House and Senate passed versions of the bill is as follow:Senate                             Federal-aid Highway      $27 B                                      Discretionary Grants      $5.5 B                                    Transit Formula Grants  $8.4 B                                     TRANSIT New Starts      0                                                Airport Improvement       $1.1 B                                      HouseFederal-aid Highway       $30 B                                      Discretionary Grants        0                                      Transit Formula Grants   $9.5 BTRANSIT New Starts       $2.5 B                                    Airport Improvement         $ 3 B                                The Federal-aid highway funds will be distributed according to SAFETEA-LU formulas but the bills use two different formulas. The Senate formula will result in approximately 55 percent of each states' apportionment going to the State DOT, 45 percent to metropolitan areas and 5 percent to the Congestion Mitigation and Air Quality Improvement program (CMAQ). The House formula gives approximately 70 percent of each states' apportionment directly to the DOT, 25 percent to metropolitan areas and 5 percent will be used for enhancement projects.In addition to traditional highway and bridge projects, the Senate bill makes storm water runoff, passenger and freight rail, and port projects eligible for these formula funds. The Senate bill also establishes a new Discretionary Grant Program for Surface Transportation Projects funded at $5.5 billion. States would have to apply for these grant funds which could be used for highway, transit, freight and passenger rail, port and intermodal connection projects valued between $20 million and $500 million. Priority would be given to projects that could be completed within 3 years. Grants would be awarded on a competitive basis based on criteria to be established by DOT.Both the House and Senate bills include "use or lose" requirements. In the House bill, states are required to obligate 50 percent of their apportionment within 90 days. States would lose 50 percent of the funds not obligated in the first 90 days. These lost funds would be redistributed to states that had obligated their funds (50 percent of their apportionment) within the 90 day window. States would be further required to obligate the second 50 percent of their apportionment by August 1, 2010. Funds not obligated by that date would be redistributed to states that had fully obligated their state apportionment. These redistributed funds would have to be obligated by September 30, 2010 or they would be lost.In the Senate, States would have to obligate fifty percent of their formula funds within 180 days, at which time unobligated funds would be redistributed to states that used their funds. The second 50 percent of the formula funds would have to be obligated one year after enactment. Funds not obligated within one year would go into the new discretionary grant program, rather than be redistributed to other states as in the House bill. The Discretionary grants would be available until September 30, 2011.

The House passed the American Recovery and Reinvestment Act of 2009, better known as the Economic Stimulus Package, on Wednesday by a vote of 244 to 188. Highway and transportation infrastructure funding in the bill totaled over $46 billion, including: $30 billion for bridge and highway funding, to be distributed to states using existing formulas, with a portion of the funds within each state being sub-allocated to local areas; $12 billion for transit funding, with new construction being distributed on a discretionary basis, and upgrades, repair, and other assistance being distributed according to existing formula; and $3 billion for Airport Improvement Grants, distributed on a discretionary basis. The bill was amended on the floor to increase the transit funding by $3 billion to increase the total to $12 billion. A second amendment was adopted cutting the time for the first 50 percent of the highway funds to be obligated from 180 days to 90 days. The Senate is expected to take up its version of the stimulus bill next week. Funding totals in the senate bill differ and are as follows: $27 billion for bridge and highway funding, to be distributed to states using existing formulas, with a portion of the funds within each state being sub-allocated to local areas; $5.5 billion to fund a newly created grant program for mega projects including highways, bridges, transit, ports, and rail; $$8.4 billion for transit funding for upgrades, repair, and other assistance being distributed according to existing formula; and $1.1 billion for Airport Improvement Grants, distributed on a discretionary basis.  Amendments to increase a variety of infrastructure categories are expected and supported by AGC. Senators Barbara Boxer (D-CA), Jim Inhofe (R-OK), Max Baucus (D-MT) and George Voinovich (R-OH) have sent a letter pointing out that the funding for highways and bridges is inadequate. They intend to propose an amendment to increase highway funding by $40 Billion. AGC urges you to contact your Senators and request that they support infrastructure as part of the economic stimulus package and that they support the Boxer/Inhofe/Baucus/Voinovich amendment to increase highway funding in the bill.You can send an email through AGC's Legislative Action Center urging your Senators to support this amendment. Please send your email today, debate begins on Monday.

The Senate has approved the nomination of former Rep. Ray LaHood an Illinois Republican, to serve as Secretary of Transportation. During his confirmation hearing Secretary LaHood said his priorities will focus on the economy, safety, mitigation of global warming and promotion of sustainable communities. In response to questions concerning the health of the Highway Trust Fund, LaHood said he recognized the need to develop new revenue sources but said use of the gas tax for this purpose is a "dinosaur". He endorsed the use of public-private partnerships and tolling for new capacity projects, but questioned the use of tolling of existing roads or bridges.

AGC presented testimony to the House T&I Committee in support of the infrastructure investment included in the economic stimulus legislation under consideration. Presenting AGC's testimony was George Mason University economist Stephen Fuller who made the arguments that the current stimulus plan's proposed infrastructure investments would create or support more than 1.85 million new jobs between now and the end of 2010.  He said that would include over 620,000 construction jobs, 300,000 jobs in supplying industries and 930,000 jobs throughout the broader economy. Fuller noted, for example, that the construction industry has plenty of capacity to handle the range of infrastructure projects being considered in the stimulus legislation.  He added that the planned infrastructure funding would account for approximately 9 percent of current construction funding nationwide at a time when construction output is down 14 percent and employment in the constructions sector.  This is the third time in recent weeks that AGC has been asked to presented testimony to Congressional committees concerning the status of the construction market and the impact of stimulus funding on the construction economy.

The nonpartisan Congressional Budget Office earlier this week released a report giving its assessment of the proposed economic stimulus legislation and projected that less than half of the funds are likely to be used before the end of fiscal 2010. The CBO said the balance would likely be spent over the next several years, after the recession is projected to end. The report specifically questions how quickly the infrastructure funds will make their way into the economy. Republican leaders said the analysis shows that the package wouldn't create the promised jobs. AGC and our coalition partners the Transportation Construction Coalition, Americans for Transportation Mobility and AASHTO responded to the report with a letter to Congress pointing out that CBO's analysis of the infrastructure spending is based on historical data which does not really apply to current situation. The letter says "This is not business as usual!"  State DOTs, the construction industry, materials suppliers and labor are geared to move "ready to go" projects quickly to contract and construction and thus create thousands of jobs in this fiscal year. House Speaker Nancy Pelosi (D-CA) and the leadership of the House Transportation and Infrastructure (T&I) Committee also responded pointing out that CBO did not have the full data when they made that report. T&I Committee Chairman Jim Oberstar (D-MN) met with CBO director yesterday who admitted that they did not have the full data on which to base their projection.