Obama Administration Releases Transportation Bill
On April 29, 2014, the U.S. Department of Transportation (U.S. DOT) released legislative language for the Generating Renewal, Opportunity, and Work with Accelerated Mobility, Efficiency, and Rebuilding of Infrastructure and Communities throughout America Act (GROW AMERICA Act). The bill would provide $302 billion over four years for the federal government's surface transportation program, including highway, transit, rail, and safety programs. This release follows the Obama Administration's February 2014 announcement of the broad framework for a transportation reauthorization bill, which was subsequently included in its FY 2015 budget proposal. Moving Ahead for Progress in the 21st Century (MAP-21), the current transportation authorization law, is set to expire on September 30, 2014.
The act includes a number of important themes:
- Funding: The GROW AMERICA Act provides increased investment levels across the board, but it particularly increases funding for non-highway modes, renaming the "Highway Trust Fund" as the "Transportation Trust Fund" and folding various new programs into it. GROW AMERICA relies on a one-time infusion of $150 billion in general revenues to both cover the anticipated shortfall in the Transportation Trust Fund and increase total funding by roughly $90 billion over four years. Although the proposal offers few details, these transfers will be offset by new revenues raised from corporate tax reform.
- "Fix-It First": The act emphasizes maintenance of the existing transportation system and includes a new Critical Immediate Investments program to improve pavement conditions on both the National Highway System and the Interstate system's structurally deficient bridges. The act also expands state-of-good-repair programs for transit.
- Competitive programs: The act continues the recent interest in competitive programs. It expands and provides dedicated funding to the Transportation Investments Generating Economic Recovery (TIGER) grant program and also establishes a new Fixing and Accelerating Surface Transportation (FAST) grant program. FAST would encourage state and local governments to adopt innovative strategies to coordinate transportation, land use, and economic development policies.
- Freight: For the first time, the act provides dedicated funding for freight improvements, split equally between competitive grants and incentive grants. The incentive grants would be awarded to states that have established freight advisory councils and completed freight plans; additional incentives would be offered to states that coordinate their plans with neighboring states.
- Metropolitan planning: The act supports "high-performance" metropolitan planning organizations (MPOs) by increasing the share of Surface Transportation Program (STP) and Transportation Alternatives Program (TAP) funds that they program. It defines "high-performing" MPOs as those that the Secretary of Transportation determines to have equitable, performance-based decision-making, and to have coordinated planning activities with any other MPOs in its metropolitan statistical area. The act also directs funding to high-performance MPOs through a new Metropolitan Mobility Program housed within the FAST grant program. The act expands upon MAP-21's performance measurement requirements to move toward performance-based funding and further expands planning requirements to include new topic areas (e.g., reducing the risk from extreme weather events).
- Tolling: The act removes the current restriction barring states from tolling existing Interstate highways and allows states to apply to U.S. DOT for permission to toll after reconstructing an Interstate facility. The act also allows congestion pricing on existing highways, bridges, and tunnels for traffic management purposes. It permits the use of toll revenues for transit improvements in priced corridors, along with other strategies to mitigate the adverse impacts of tolling. The act also requires future toll roads to use electronic toll collection.
- "Ladders of Opportunity": The act provides $245 million in workforce development grants to support job training opportunities related to the transportation and construction industries. It also establishes a pilot program to support MPOs in better connecting transportation planning with education and job opportunities.
- Innovative financing: GROW AMERICA maintains the MAP-21 emphasis on encouraging private investment in transportation. The act continues to fund the Transportation Infrastructure Finance and Innovation Act (TIFIA) Program at $1 billion annually, expands the Railroad Rehabilitation and Improvement (RRIF) Program to be more accessible to smaller railroads, and increases the Private Activity Bond (PAB) cap to $19 billion from the current $15 billion.
- Accelerated project delivery: The act continues MAP-21's emphasis on streamlining project delivery by promoting the concurrent review of transportation projects by federal agencies, increasing collaboration across agencies, and eliminating duplicative requirements. It also provides additional flexibility in the use of federal funds to support environmental reviews and increases the public transparency of the review process by requiring materials to be posted online.
The GROW AMERICA Act totals $302 billion between FY 2015-18, or about $75.5 billion each year. This average annual total is a 37 percent increase over the enacted funding levels for FY 2014. The proposal includes relatively modest increases in funding for highway and safety programs, along with substantial increases in funding for transit and rail programs. The following table summarizes the broad funding levels to be allocated from the Transportation Trust Fund.
|FY 2015-18 Total||FY 2015-18 Annual Average|| |
Annual Average Increase over FY 2014 levels
|TIGER||$5.0 billion||$1.3 billion||108%|
|Federal Highway Administration (FHWA)||$199.2 billion||$49.8 billion||21%|
|Federal Transit Administration (FTA)||$72.3 billion||$18.1 billion||69%|
|Federal Motor Carrier Safety Administration (FMCSA)||$3.0 billion||$0.75 billion||32%|
|National Highway Traffic Safety Administration||$3.7 billion||$0.92 billion||12%|
|Federal Railroad Administration (FRA)||$19.1 billion||$4.8 billion||243%|
|Total||$302.3 billion||$75.6 billion||37%|
GROW AMERICA appears to provide only inflationary increases in funding for the core highway funding programs and stable funding for the TIFIA credit assistance program. Rather, much of the 21 percent average annual increase in funding to FHWA programs is driven by a new Critical Immediate Investments Program at $3.4 billion annually, along with a new multimodal freight investment program at $2.5 billion annually. The new freight program includes a total of $5 billion in discretionary grants over the four-year life of GROW AMERICA, along with a total of $5 billion for incentive grants earned by states.