Update from Washington, D.C. 11/18/2011
Time is running short for the supercommittee to produce a plan
that would reduce the deficit by at least $1.2 trillion over the
next decade. With just days until their November 23 deadline,
Democrats and Republicans remain deeply divided over the proper
balance of tax increases and spending cuts. While a deal has
proven elusive thus far, lawmakers are eager to avoid
across-the-board spending cuts that would automatically go into
effect in 2013 if the committee is unable to fulfill its
mandate.
The latest GOP proposal would overhaul the tax code and raise
$250 billion in individual taxes, $50 billion in corporate taxes,
and an additional $40 billion from changes to the consumer price
index. It would also extend the Bush tax cuts that are set to
expire at the end of 2012.
For their part, Democrats on the panel are mulling a two-step tax
overhaul that would produce between $600 billion and $800 billion
in new revenue. The first step of the process would include an
immediate tax increase as a “down payment.” This would be
followed by instructions to the House and Senate tax-writing
committees to overhaul the tax code by a later date.
On the appropriations front, the House and Senate cleared the
conference report for the first minibus spending package (HR
2112), which contains the fiscal year 2012 appropriations for
Agriculture, Commerce-Justice-Science (S 1572), and
Transportation-Housing and Urban Development (S 1596).
Appropriators had considered expanding the package to include two
other measures, namely the Legislative Branch (HR 2551) and
Homeland Security (HR 2017) bills, but in the end opted not to do
so.
In total, the spending bill provides $128.1 billion in
discretionary funding which is subject to the $1.043 trillion cap
established by the debt limit law and an additional $2.3 billion
for emergency relief activities not subject to the cap.
From that pot, $52.7 billion is set aside for the
Commerce-Justice-Science section of the minibus. This is $583
million lower than the fiscal year 2011 level. With regard to
funding for the State Criminal Alien Assistance Program (SCAAP)
and Community Oriented Policing Services (COPS) programs, the
conference report provides for $240 million and $198.5 million,
respectively. This is a significant improvement from the original
House proposal, which did not include funding for either
program.
The Transportation-HUD section of the package totals $55.6
billion in discretionary spending. Notably, the report eliminates
funding dedicated to high-speed passenger rail. Senate Democrats
fought to retain $100 million in high-speed rail funds they
secured in the Senate-passed bill, but were unsuccessful. They
were, however, able to secure $500 million for the TIGER grant
program, which House appropriators had zeroed out.
For HUD, the Community Development Block Grant program will be
funded at $3.3 billion, which is $192.9 million less than in
fiscal year 2011.
The Agriculture agencies and programs will receive a total of
$19.8 billion in discretionary funding, which is a reduction of
$350 million from last year’s level. The compromise provides
$80.4 billion in mandatory funding for the Supplemental Nutrition
Assistance Program, formerly known as food stamps. The measure
also provides $6.6 billion for the Women, Infants and Children
nutrition program, which is $570 million above the House-passed
level and $33 million above the Senate’s version.
A continuing resolution was also included in the final agreement.
This stopgap funding provision will keep the government running
through December 16. Congressional leaders are hoping that this
will be the last continuing resolution needed this year, but it
remains to be seen whether lawmakers will be able to complete the
remaining nine spending bills in less than a month.
In related news, Senate Majority Leader Harry Reid (D-NV)
attempted to package three additional appropriations bills –
Energy-Water (HR 2354), State-Foreign Operations (S 1601), and
Financial Services (S 1573) – into a second minibus. This measure
has proven more difficult than the first, and as such, the
prospects are not as bright.
One of the main obstacles has been the sheer volume of amendments
prepared. One amendment – sponsored by Senators John Barrasso
(R-WY) and Dean Heller (R-NV) – to the Energy-Water portion of
the bill would bar the U.S. Army Corps of Engineers from
implementing a controversial guidance that drastically expands
the scope of the federal Clean Water Act. CSAC, in partnership
with the Regional Council of Rural Counties (RCRC), sent a letter
to Senators Dianne Feinstein and Barbara Boxer in support of the
amendment.
As efforts on the second minibus have stalled, the Senate has
turned their attention to other matters. At this point, the
remaining spending measures will likely be rolled into one
massive omnibus package.
In other news, the Senate Environment and Public Works (EPW)
Committee unanimously approved its long-awaited highway
reauthorization bill (S 1813) on Wednesday, November 9. The two
year, $109 billion package, entitled Moving Ahead for Progress in
the 21st Century (MAP-21), would fund highway programs at current
levels, plus inflation.
Notably, the legislation does not identify a source for the
roughly $12 billion that would be needed to fully fund the
proposal. That particular task lies in the hands of the Senate
Finance Committee, which has jurisdiction over the revenue title
of the bill. It is unclear when the Finance Committee will
produce its MAP-21 financing package.
Sponsored by EPW Committee Chairman Barbara Boxer (D-CA), MAP-21
would consolidate the number of federal highway programs from 90
down to less than 30. Under the bill, core programs would be
reduced from seven to the following five programs:
National Highway Performance Program – consolidates the
Interstate Maintenance, National Highway System (NHS), and
Highway Bridge programs into a single new program designed to
provide increased flexibility while guiding state and local
investments to maintain and improve the NHS.
Transportation Mobility Program (TMP) – replaces the Surface
Transportation Program (STP) while retaining the same structure
and goals of STP to allow states and metropolitan areas to invest
in highway, bridge, and other priority transportation projects.
Certain activities that previously received dedicated funding via
SAFETEA-LU, but are being consolidated under MAP-21, would be
retained as eligible activities under the TMP (such as border
infrastructure projects and safe routes to school projects).
Unlike current law, MAP-21 would not provide dedicated funding
for bridges (the legislation would eliminate the Highway Bridge
Program (HBP), as well as the 15 percent off-system set-aside for
local bridges). MAP-21 does include language, however, that
specifies that if the total deck area of deficient off-system
bridges in a state increases for the two most recent consecutive
years, the state is required to spend an increased percentage of
funding on off-system bridges.
Under the new TMP, and unlike the program it would replace (STP),
funding for Transportation Enhancement (TE) activities would no
longer be set-aside. However, TE activities, while somewhat
narrowed, would be one of 26 eligible TMP funding categories.
National Freight Network Program – designed to improve goods
movement by consolidating existing programs into a new freight
program. Funds would be provided to states by formula for
projects to improve regional and national freight movements on
highways, including freight intermodal connectors.
Under the Senate bill, network components would include a primary
freight network (comprised of 27,000 miles of existing roadways),
portions of the Interstate System not designated as part of the
primary freight network, and critical rural freight corridors
(comprised of rural principal arterial roadways that meet certain
criteria).
Congestion Mitigation and Air Quality (CMAQ) Improvement Program
– CMAQ would continue to provide funds to states for
transportation projects designed to reduce traffic congestion and
improve air quality. The bill would require a performance plan in
large metropolitan areas to ensure that funds are used to improve
air quality and congestion in those regions. The legislation also
includes particulate matter as one of the pollutants addressed by
CMAQ.
Highway Safety Improvement Program (HSIP) – MAP-21 would
significantly increase the amount of funding for the HSIP in an
effort to build upon strong results in reducing highway
fatalities. Comparable to current law, states would need to
develop and implement State Strategic Highway Safety Plans that
identify priority safety programs. Plans would need to be
developed after consultation with the governor, regional
transportation planning organizations and metropolitan planning
organizations, county transportation officials, and other state
and local representatives and stakeholders.
Under the HSIP, construction and operational improvements on high
risk rural roads would be one of a number of allowable highway
safety improvement project areas. Although the bill would
eliminate the High Risk Rural Roads (HRRR) program, the
legislation specifies that if the fatality rate on rural roads in
a state increases over the most recent two-year period, the state
is required to provide for a specified level of increased funding
for rural roads in the next fiscal year.
Environmental Streamlining Provisions
As expected, MAP-21 includes various provisions designed to
expedite project delivery, including language that would continue
the Surface Transportation Project Delivery Pilot Program
(California’s current NEPA delegation program). Under the bill,
the current pilot could be made permanent for a State that has
demonstrated to the Secretary of Transportation that it has
adequately carried out the responsibilities assigned to it under
the streamlining program.
MAP-21 expands the types of projects that could be undertaken
through a categorical exclusion (CE). Additionally, the bill
would require the Secretary to issue a rulemaking that would
allow certain types of CEs that currently require Administration
approval to qualify as traditional CEs.
The legislation also would require the Secretary to seek
opportunities to enter into agreements with states that establish
efficient administrative procedures for carrying out
environmental and other required project reviews. Similarly, the
measure includes provisions aimed at providing for “accelerated
decision-making in environmental reviews” and language designed
to encourage early coordination and agreements among Federal
agencies with jurisdiction in the environmental review
process.
Designation of Metropolitan Planning Organizations (MPOs)
Under MAP-21, urbanized areas with a population of more than
200,000 would be guaranteed an MPO designation. In general, areas
with more than 1 million residents would receive a “Tier I”
designation, while areas with 200,000 to 1 million residents
would be designated as “Tier II” MPOs. Multiple MPOs would be
able to consolidate to achieve the population thresholds for Tier
I and II status.
With regard to planning activities, Tier I MPOs would be held to
performance-based standards, including incorporating performance
targets and scenario-based planning processes, into regional
plans. Tier II MPOs could employ a performance-based planning
approach if approved to do so by the Secretary; the Secretary
would be required to take into account the complexity of the area
and the technical capacity of the Tier II MPO in making such a
determination.
With regard to small urbanized areas (areas with a population
greater than 50,000 but less than 200,000), MAP-21 would
terminate such MPOs three years after the Secretary promulgates
new rules. However, smaller MPOs would be allowed to continue as
Tier II MPOs if reaffirmed by the Governor and if minimum
technical requirements are met. If minimum standards are not met,
the Governor would be able to request probationary continuation
on behalf of the MPO, which would delay termination by one
additional year.
Transportation Infrastructure Finance and Innovation Act
(TIFIA)
MAP-21 includes provisions that build upon the current
Transportation Infrastructure Finance and Innovation Act program.
TIFIA, which provides direct loans, loan guarantees, and lines of
credit to surface transportation projects at favorable terms to
leverage private and other non-federal investment in
infrastructure improvements, would be modified by, among other
things, increasing the maximum share of project costs from 33
percent to 49 percent. Additionally, the legislation includes a
program set-aside for rural areas (10 percent) at more favorable
terms. Overall, TIFIA program funding would be increased to $1
billion per year.
House Transportation Bill on the Horizon
Across Capitol Hill, House Speaker John Boehner (R-OH),
Transportation and Infrastructure Committee Chairman John Mica
(R-FL) and other House Republicans announced on Thursday,
November 17 their plans to move forward with a long-term
transportation reauthorization bill. While details of the
proposal are not yet available, the legislation will reportedly
span five years, instead of six as previously advertised, and
will link new American energy production to investment in
infrastructure projects.
According to House Republicans, their transportation legislation,
which will be titled the American Energy and Infrastructure Jobs
Act, is the latest component of the GOP’s American Energy
Initiative. The transportation bill will include three
energy-related measures, including legislation that would lift
the Obama administration’s drilling ban on new offshore areas, a
bill that would set clear rules for oil-shale development, and a
proposal that would open roughly three percent of the Arctic
National Wildlife Refuge (ANWR) for oil and natural gas
development.
Additionally, the reauthorization measure is expected to
eliminate and consolidate nearly 70 surface transportation
programs, as well as streamline the project delivery process.
The GOP’s transportation bill is expected to be released shortly
after the Thanksgiving holiday. The legislation may be considered
in the T&I Committee in early December, with House Republican
leaders indicating that they expect to move the bill through the
full House before the end of the year.