CONNstruction - Spring 2015 - (Page 20)

feature Federal Surface Transportation ©iStockphoto.com|pichet_w FundIng Outlook in 2015 By Dean Franks, Vice President, Congressional Relations along with the American Road and Transportation Builders Association Staff The challenges to the transportation construction industry in Hartford, Washington, D.C., and across the country are similar: growing needs and scarce resources. And with Connecticut, since 2001, on average, relying on federal funds for 71 percent of its yearly highway and bridge capital improvements, the importance of a long-term surface transportation bill to your state should be clear. Unfortunately, a multi-year highway and public transportation investment bill cannot move forward until the Highway Trust Fund (HTF) revenue foundation is stabilized. When Congress and President Obama acted last July to temporarily patch the trust fund to prevent a shutdown of new federal surface transportation investment, they also started the clock on the next trust fund crisis as projections show the $10.8 billion transferred to the fund will be depleted sometime this summer. And while revenues into the HTF continue to grow modestly, that growth is not sufficient to keep pace with the current federal highway/transit funding levels. Consequently, the HTF needs roughly $15 billion per year to maintain current investment. The cost of annual trust fund fixes and the increasing difficulty of finding budget gimmicks as offsets, combined with a desire by members of Congress to get beyond this dysfunctional cycle, has led many in both parties to begin 2015 by pushing for a long-term trust fund solution and reauthorization bill. Adversaries of federal surface 20 / CONNstruction / SPRING 2015 transportation investment have seized on these comments to elevate their opposition efforts. As such, the overdue national discussion on funding federal highway/transit investment is underway. 2015 HTF options Scenarios currently being discussed by Congress to stabilize the HTF include: * budget Gimmicks-The 2012 and 2014 trust fund patches relied on savings to the U.S. Treasury derived from changes to federal pension requirements. While it appears there is little money to be saved from further relaxing pension obligations, it should not surprise anyone if Congress finds other creative ways to generate resources. * Tax Increase-A gas tax increase or some other tax related to system use (barrel tax, refinery tax, sales tax on fuel) is being discussed by numerous members of Congress. These user taxes generate reliable, recurring streams of revenue and require little overhead costs. The primary impediment to such an increase is a political concern related to raising taxes (which could be mitigated if part of a larger tax/ budget package). * Repatriation of Overseas Corporate Profits-Some representatives and the Obama Administration are advocating "repatriation" to pay for infrastructure investment. One way this could be accomplished is by imposing a federal transition tax on foreign held profits not taxed in the U.S. This mechanism would generate a one-time revenue pool that could support a five- or six-year surface transportation bill (i.e., $126 billion). There are two immediate downsides to the repatriation approach, however. First, at the end of those five or six years, the HTF would again be in a crisis situation. Second, the chairmen of the tax committees have generally indicated their desire to use repatriation to help "grease" an overall corporate tax reform bill-an event which could be a year or two away. HTF end game At this point, the House Ways and Means Committee-which has jurisdiction over the HTF-has divulged little about its plans for a trust fund solution. By comparison, members of the Senate committee of jurisdiction, the Finance Committee, have repeatedly stated all options are being considered to reach an HTF solution. The Finance Committee developed the two-year, bipartisan trust fund plan that enabled Congress to pass the MAP-21 reauthorization bill in 2012. Despite Republican successes last November, both parties continue to have significant influence in Washington. No laws will be enacted without support from the Republican-driven House or President Obama. This makes the Senate the testing ground for any bills that could potentially garner bipartisan support. Senate Republicans need six democratic votes to

Table of Contents for the Digital Edition of CONNstruction - Spring 2015

On the Right Track
Is it Time to Re-Think How We Fund Our Transportation Program?
More Work to Do
Improvement Program Enhances Mobility and Safety While Encouraging Economic Growth
Roads and Bridges: Key to Connecticut’s Economic Life
2014 CCIA Annual Report
Federal Surface Transportation Funding Outlook in 2015
Connecticut Road Builders Association Fall Meeting
ConnDOT 2014 Arthur W. Gruhn Excellence in Construction Awards
Connecticut Environmental and Utilities Contractors Association 2014 Annual Fall Program
The North East Regional ConcreteWorks
CCIA Annual Membership Meeting & Holiday Reception
Index to Advertisers/Advertiser.com

CONNstruction - Spring 2015