Congress passes 3-month highway, transit aid bill

31 Jul 2015 | Author: | No comments yet »

Bill shores up highway aid, veterans’ health care.

WASHINGTON — Congress passed a bill Wednesday to shore up federal aid for highway and transit programs and fill a budget hole in veterans’ health care.

WASHINGTON — The Senate passed a long-term transportation bill, but with House lawmakers already dispersed for their August recess, the bill will become just one more sticky issue on a jam-packed congressional agenda in the fall. It would make changes to highway, transit, railroad and auto safety programs, but its sponsors were only able to find enough money to pay for the first three years of the six-year bill. The long-term Senate bill, passed 65-34 Thursday, would provide a six-year blueprint for spending on roads, bridges and mass transit projects while paying for three of those years.

The extra money is necessary because the balance in the federal Highway Trust Fund is forecast to drop below the $4 billion cushion necessary to prevent disruptions in aid to states in early August. The highway extension bill includes nearly $3.4 billion to fill in a gap in the Department of Veterans Affairs’ budget that officials say could force the government to close hospitals and clinics nationwide. The legislation will be part of conference committee negotiations on long-term highway funding with the House, which passed a five-month highway fund extension earlier in July that didn’t renew Ex-Im.

House members have said they are working on their own longer-term bill. “The multi-year nature of this legislation is one of its most critical components,” Senate Majority Leader Mitch McConnell, a Kentucky Republican, said on the Senate floor Thursday. “It’s also something the House and Senate are now united on.” House Minority Leader Nancy Pelosi, a California Democrat, told reporters, “Now, we have a short-term bill. The VA has told Congress that it may shutter hospitals unless it receives flexibility to close a $2.5 billion shortfall caused by a sharp increase in demand by veterans for health care, including expensive treatments for hepatitis C.

Congress must also decide whether to approve or disapprove President Barack Obama’s Iran nuclear deal, and whether to pass a contentious defense policy bill that faces a veto threat from the White House. The short-term plan would extend funding through Oct. 29, providing $6 billion for highways and $2 billion for mass transit financed mostly by tightening tax compliance rules. The Senate’s three-year-plan, H.R. 22, is opposed by the banking industry because it would finance highways partly by reducing dividends to banks from the Federal Reserve. It would cut the 6 percent dividend paid to member banks to 1.5 percent for banks with more than $1 billion in assets, which is expected to generate more than $16 billion for the highway fund. Since long-term bills to set aviation policy have yet to be introduced in either the House or the Senate, lawmakers acknowledge they will have to pass short-term extensions there as well.

That proposal is one reason the Senate Banking Committee’s Republican chairman, Richard Shelby of Alabama, and its top Democrat, Ohio Senator Sherrod Brown, both oppose the bill. “Some of the pay-fors bother me,” Brown said in an interview Wednesday. “Small banks will contribute to this instead of it being a transportation bill funded by transportation. There are safety concerns as well; it’s really all of it.” The Senate measure would revive the 81-year-old Ex-Im Bank, which has been unable to approve new applications for loans, guarantees and insurance since its charter expired June 30. Large manufacturers including Chicago-based Boeing Co. and Fairfield, Connecticut’s General Electric Co., have said the lapse in the bank’s charter puts them at risk of losing sales to competitors in Europe, Brazil, Japan and China who can get government-backed financing. The bill also attempts to speed up environmental reviews of construction projects and encourages states to impose user fees on electric vehicles because they use roadways but don’t contribute to federal gas tax revenues.

It also sets aside money for major projects and directs highway aid to major freight transportation corridors, starting with $1.5 billion in fiscal 2016 and increasing to $2.5 billion in 2021. The bill requires that rental car agencies fix cars subject to safety recalls before renting them, but it doesn’t include language sought by safety advocates requiring car dealers to fix recalled used cars before selling them. It would force the Federal Motor Carrier Safety Administration to conceal from the public its safety ratings of trucking companies; the trucking industry says the agency’s methodology is flawed.

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