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Posted January 2010
Transportation infrastructure
across the nation is crumbling, and cash-strapped states are seeking financial
assistance from the federal government for maintenance, enhancement, and
expansion projects. The U.S. Congress is currently considering two options that,
if approved, will send billions of dollars to state transportation departments.
The first bill being debated is
the so-called 'Jobs for Main Street' which has been styled as a limited
supplement to last February's American Recovery and Reinvestment Act (ARRA). The
House version of this second stimulus package - which was passed by the chamber
before the winter recess - allocates $27.5 billion for highways, $8.4 billion
for transit, and $500 million for airports. The Senate is less enthusiastic
about spending more federal money and reportedly would like to see total
transportation spending in the bill reduced to under $30 billion.
The House version of the second
stimulus also extends the Safe, Accountable, Flexible, Efficient Transportation
Equity Act (SAFETEA-LU), which set aside $42 billion annually for state
transportation construction, with its original amount of funding until the end
of the fiscal year. SAFETEA-LU expired at the end of September but Congress has
extended the legislation until the end of February at the annual level of $30
billion. According to the Associated General Contractors of America, states have
a $62 billion backlog of 'shovel-ready' projects that need funding.
Many lawmakers and officials,
though, prefer a separate, multi-year replacement for SAFETEA-LU instead of
another extension of the expired program. According to the American Association
of State Highway and Transportation Officials, state transportation departments
are unable to make long-term plans without stable fiscal projections.
The House and Senate are both
expected to propose a six-year successor for SAFTEA-LU with a price tag of
approximately $500 billion early this year. However, some experts have pointed
out that this price-tag may be too much for federal government to bear
considering its recent spending. New transportation taxes and bonds have both
been floated as potential revenue sources.
The White House has yet to back
the Congressional Democrats' transportation bill and has said it will not
support new transportation taxes in the current economic climate.
Conservative lawmakers and
advocacy groups are putting up stiff resistance to the 'Jobs for Main Street'
bill. They contend that stimulus spending on transportation has failed to retain
and create new jobs. A recent study by the Associated Press (AP) supports this
position. After analyzing ARRA employment figures, the AP found no correlation
between stimulus spending on transportation projects and the number of
construction workers hired or fired.
Construction industry experts
have rejected the AP's findings.
"The fundamental assumptions in
today's Associated Press story are flawed," said Ken Simonson, chief economist
for the Associated General Contractors. "It is virtually impossible to measure
the impact of $4 billion by looking at overall employment figures for an
industry experiencing a $137 billion drop in activity - especially when only one
in twenty construction workers stand to benefit from those stimulus funds."
Still, some Senate Democrats
are questioning the efficacy of another stimulus bill.
"Senator Nelson is very
concerned about the level of federal spending and the deficit," said a spokesman
for Ben Nelson, D-NB. "He would look at a jobs package, but those factors would
weigh heavily in his mind."
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