May 17, 2013

PREPARED BY CATHY CONNOR - MANAGER OF GOVERNMENT AFFAIRS

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The big news this week for infrastructure investment is Senate passage of the $12B Water Resources Development Act of 2013 (WRDA) - see more below.  Attention in both bodies now turns to the FY'14 annual appropriations process.  The House and Senate have been unable to agree on a joint FY'14 Budget Resolution because their separately passed Budget Resolutions are approximately $100B (yes, that is billions) apart in their caps on discretionary spending.  It appears that the House will move the FY'14 DOD, Homeland Security, and Military Construction-VA bills, but beyond that, it is increasingly likely that most other federal agencies will end up once again operating under a Continuing Resolution (CR) in FY'14, for the second year in a row.   

Congress will be in session next week before leaving for the week-long Memorial Day recess.  

WRDA 

WRDA authorizes Corps of Engineers programs including port dredging, harbor construction and maintenance, levee and dam safety, coastal and wetlands restoration, and inland waterway infrastructure maintenance.  The last time Congress passed what is supposed to be a biennial bill was in 2007.  The vote to pass the bi-partisan bill was 83 to 14.  The "no" votes were from one Democrat (Leahy-VT) and 13 Republicans. 

The Senate-passed WRDA bill:

• Authorizes construction of Corps water projects that have a completed Chief of Engineers report.  Funding for approved projects will need to be included in the annual Corps appropriations bill.  In previous WRDA bills, individual projects were earmarked for funding.
• Ensures the annual Harbor Maintenance Trust Fund user fee revenues are fully spent to maintain ports and harbors.  The bill authorizes funding for eligible projects at $1B in FY'14 with $100M annual increases each subsequent year.  By 2020 all revenues into the Fund must be used annually.  Currently the Trust Fund has a large unspent balance despite significant unmet needs. 
• Streamlines the Corps of Engineers environmental review and approval process despite strong objections from the environmental community.  The provisions include time limits for completing feasibility studies.  In an effort to appease environmental concerns, the streamlining provisions will sunset after ten years. 
• Creates a new Water Infrastructure Financing and Innovation Act (WIFIA) program, similar to the very popular surface transportation TIFIA financing program, to provide loans and loan guarantees for water projects.   
• Authorizes shipping channel improvements including permitting federal maintenance funds to be used at 50-feet deep ports.   

Action now moves to the House where T&I Committee Chairman Bill Shuster (R-PA) has indicated that WRDA is his top priority, but other than a few hearings, no formal action has been taken to date on a bill.  Shuster hopes to get a bill out of the full House sometime this summer.  

Unlike in previous WRDA bills, the Senate bill (S.601) does not include any project earmarks (or at least not ones that involve direct funding of specific projects).  Current House rules also prohibit earmarks and that may make it difficult to get the political support needed to pass a bill in the House. 

Anthony Foxx Nomination

The Senate Commerce Committee has scheduled a confirmation hearing on the nomination of Charlotte Mayor, Anthony Foxx, to be the next Secretary of Transportation for 2:30pm on Wednesday, May 22.  Foxx must be approved by the Committee and then his nomination will be voted on by the full Senate which will likely not occur until after the Memorial Day recess.  Commerce Committee Chairman Jay Rockefeller (D-WV) and a number of other committee members, including some Republicans, have expressed strong support for Foxx. 

At this point, there do not appear to be any issues that will hold up Foxx's confirmation, however, several other Obama nominees, including those for Labor and EPA, are being  opposed over various partisan concerns not related to the credentials of the nominees. 

FTA Final FY'13 Apportionments

In the May 14 Federal Register, FTA published a notice regarding its FY'13 Supplemental Apportionment Tables.  The original FY'13 tables were published on October 16, 2012 and covered the first six months of the fiscal year.  This notice provides the final, full-year apportionments and allocations.  The actual tables are located on the FTA website. 

Here is a link to the Federal Register notice and a link to the FTA Apportionment Tables.  See the 7^th Table for the final FY'13 allocations for the Section 5309 Fixed Guideway Capital Improvements Grants (CIG), also known as New Starts.  Following sequestration, the usual oversight takedown and a .2% rescission, the CIG program is left with only $1.836B for FY'13.  The allocations for the FY'13 CIG program were also included in FTA's Annual New Starts Report released in early April. 

FTA plans to publish Notices of Funding Availability (NOFAs) in the Federal Register for FY'13 discretionary grants such as the TOD Planning Pilot Program and the Passenger Ferry Program.  The May 14 Federal Register notice also includes an illustrative apportionment for the new MAP-21 State Safety Oversight (SSO) program and requests comments from the public by June 12. 

Other News

• FHWA will be hosting a series of webinars to help public agencies assess the vulnerability of infrastructure to climate change and extreme weather events.  Here is a link to more information on webinar times and how to register.The webinars include:
  • May 16 - Determining Assets to Study - completed
  • May 30 - System-Level Vulnerability Assessments
  • June 12 - Applying the Results
  • June 20 - Lessons Learned from Hurricane Sandy  
• US DOT held a series of webinars on the TIGER V discretionary grant application process.  Applications for TIGER grants are due by June 3.  Here is a link to the webinar recordings on Application Preparation, Benefit-Cost Analysis and Port Outreach. 
• FTA has posted a 14-page final guidance document on the new Categorical Exclusions (CEs) that it announced in February in an effort to streamline the NEPA process.  The CEs are expected to provide a more straightforward and efficient environmental review process.  Here is a link to the guidance. 
• On May 15, the House T&I Committee's newly created Panel on 21^st Century Freight Transportation, which is chaired by Rep. Jimmy Duncan (R-TN), held a Roundtable to examine what efforts US DOT and the Army Corps of Engineers have made to coordinate freight transportation policy.  US DOT Deputy Secretary John Porcari and Assistant Secretary of the Army for Civil Works Jo-Ellen Darcy participated in the panel discussion.  Deputy Secretary Porcari agreed with members of the Panel that a highway-only freight network is too limiting and that it would be useful to have a federal discretionary program to address the needs of large-scale projects of regional and national significance.  The T&I Panel will meet again in late May in Los Angeles to tour the ports of LA and Long Beach and in mid-June in Memphis to tour parts of the Crescent Corridor and the Port.  During the Roundtable, Porcari mentioned that the Department received 260 applications for approximately 30 to 40 slots on the new MAP-21, external Freight Advisory Committee which will advise the internal US DOT Freight Policy Council.  US DOT hopes to announce the members very soon.
• In Hurricane Sandy news, the Department of Interior has released $475M in Emergency Relief funds for National Park Service and other DOI facilities damaged by the storm.  Here is a link to the DOI press release and a link to a list of approved projects and funding amounts.  In related news, last week the federal government approved New York City's plan to spend the $1.77B it has been allotted to date in HUD CDBG Disaster Relief funds.  Here is a link to the City's approved plan which includes $360M to repair infrastructure and $294M for infrastructure resiliency investments. 
• Two new modal Deputy Administrators have been named at US DOT. At NHTSA, David Friedman is NHTSA's new deputy administrator.  Friedman, an engineer by training, previously served as a transportation analyst at the Union of Concerned Scientists where he pushed for stricter fuel economy standards.  At FAA, the White House announced that it will appoint Michael Whitaker as deputy FAA administrator. Whitaker worked for United Airlines as an executive from 1994-2009, and before that as a counsel to TWA.

April 26, 2013

Congress continues to be focused on a number of big picture issues, such as immigration reform, the aftermath of the Boston bombings, and the impacts of the sequestration, particularly the furloughs of government employees.  Congress will be on recess next week. 

FAA Furloughs

Last night, the Senate passed a bill (S. 853) to make up to $253M available through the end of the fiscal year to cancel the current furloughs of FAA air traffic controllers and potentially the closure of FAA contract towers.  The funding would come from unobligated balances in the Airport Improvement Program (AIP) which is used to fund airport construction projects.  However, Senate staff has indicated this should not affect any FY'13 AIP grants.  The House is expected to debate and likely pass the bill later today. 

TIGER V

As previously reported, on April 22, US DOT announced the availability of $473.8M in funds to be awarded for a fifth round of the highly popular TIGER discretionary grants.  These funds will be awarded on a competitive basis for projects that will have a significant impact on the nation, a metropolitan area, or a region.  Here is a link to the Notice of Funding Availability (NOFA) and a link to the US DOT TIGER Grant Application Resources website. 

Final applications are due by June 3, 2013.  Unlike last year, a pre-application is not required.  By law, all funds must be obligated by September 30, 2014.  Therefore, applicants must demonstrate that the project can meet all local, State and federal requirements by June 30, 2014, which will be difficult to do for some projects.

Yesterday, the Eno Center for Transportation released a new report - "Lessons Learned from the TIGER Discretionary Grant Program".  Here is a link to the report.  The appendix, starting on page 23, lists all the TIGER grants made to date.  The report identifies several problematic features future programs should avoid:

•a preference for "shovel-ready" projects because that limits the ability to choose the best project

•a lack of congressional interaction

•a lack of transparency, because it undermines support for the program

•a lack of staff dedicated to the evaluation and selection of discretionary projects

In other TIGER news, Senator David Vitter (R-LA), ranking Republican on the Senate Environment and Public Works Committee, is suggesting that the Obama Administration showed "potential political bias" when US DOT distributed some of the TIGER grants.  Vitter is asking the Government Accountability Office (GAO) to probe the program's project selection.  Here is a link to a map Vitter's office released which shows that of the FY'12 TIGER grants, $346M went to Democratic congressional districts and only $132M to Republican districts.  Here is a link to the statement by Vitter and the letter he sent the GAO earlier this month.

Freight Issues

Yesterday, the House T&I Committee's new Special Panel tasked with developing recommendations for freight transportation improvements held its first hearing.  The panel is chaired by Rep. Jimmy Duncan (R-TN).  Rep. Jerry Nadler (D-NY) is the senior Democrat.  The panel's goal is to look at the freight/goods movement issue from a multi-modal perspective.  Issues discussed at the hearing included global competition, reviving the PNRS program, PPPs, and increasing truck size and weights.  All witnesses supported an increase in the federal gas tax. 

Here is a link to materials from the hearing including the witness testimony.  Witnesses included the CEOs of FedEx, Norfolk Southern, the South Carolina Ports Authority, a major trucking company, and the AFL-CIO.  Additional field hearings are expected to be held in Los Angeles, Memphis, New York City and Louisville. 

Water Resources Development Act Reauthorization (WRDA)

The Senate Environment & Public Works Committee passed a WRDA bill (S. 601) in early March and pressure is building to bring the bill to the Senate floor soon.  Parsons Brinckerhoff has signed onto an industry letter, orchestrated by the US Chamber of Commerce, urging the Senate leadership to act on the bill quickly. 

In the House, the T&I Subcommittee on Water Resources held its first hearing last week on the development of a companion House WRDA bill.  Here is a link to background on the hearing, a video of the hearing and the witness testimony. 

In related news, the Water Resources Subcommittee held a hearing this week on the FY'14 Administration budget request for the Corps of Engineers.  Here is a link to background on the hearing, a video of the hearing and the testimony from the two witnesses - Lt. General Thomas Bostick, Chief of Engineers and Jo-Ellen Darcy, Assistant Secretary of the Army - Civil Works.  Here is a link to the proposed FY'14 Corps budget request. 

FTA News

Since the FY'13 Continuing Resolution (CR) for FTA did not include any project earmarks, including for specific New Start/Small Start projects, it was left up to US DOT/FTA to use its discretion to allocate funding to the various projects.  FTA has yet to make a specific, formal announcement of its FY'13 allocations, but they included a list of the FY'13 allocations in the FY'14 annual New Starts Report.  Here is a link to a page in the Report which shows the allocations.  Since the New Starts/Small Starts funding was reduced significantly by the sequester, only New Start projects with FFGAs and two Small Start projects already under construction received any FY'13 funding.  No new projects were funded.  In addition, all the funded projects received less money than had been recommended in the Administration's original FY'13 Budget Request. 

In the April 22 Federal Register, FTA published a Notice of Availability of Proposed Circular and Request for Comments on the MAP-21 revisions to the Section 5307 Urbanized Area Formula Program.  Comments on the proposed Circular are due by June 21, 2013.  Here is a link to the Federal Register notice and a link to the actual Proposed Circular.

A recording of the recent FTA public webcast on its FY'14 budget priorities and FY'14 New Starts Report is available here.

Other News

• The House Budget Committee, chaired by Rep. Paul Ryan (R-WI), held a hearing yesterday on the "State of the Highway Trust Fund - Long-Term Solutions for Solvency".  Witnesses included Bob Poole from the Reason Foundation, Richard Geddes from Cornell University and a member of one of the SAFETEA-LU Funding Commissions, and Janet Kavinoky from the US Chamber of Commerce.  There was a lively discussion of devolution (Poole), VMT, tolling, PPPs, truck size and weight, CAFE standards, and even restricting gas tax revenues to just highways (suggested by several Republican members of the committee).
• Yesterday, the House T&I's Highways & Transit Subcommittee held a hearing on implementing MAP-21 focusing on the state and local perspective.  Representatives of AASHTO, APTA, the National Conference of State Legislators (NCSL), the National League of Cities (NLC), and the Association of Metropolitan Planning Organizations (AMPO) testified.  Here is a link to background on the hearing and the witness testimony. 
• On April 12, FTA announced the FY'12 project selections for the Paul S. Sarbanes Transit in Parks Program.  This program was first authorized in SAFETEA-LU, but was not reauthorized in MAP-21, so this will be the final year of new funding.  Of the original $26.9M appropriated, $12.4M was awarded last week.  The other funds were previously allocated in January 2012.  Here is a link (see end of Federal Register notice) to the list of projects selected which are located in CA, CO, FL, HI, NM, NY, OK, OR, TX, UT, VA and WA. 
• FHWA has announced grants in the range of $75,000 to $300,000 for vulnerability assessment pilot project grants to identify infrastructure at risk from changing climate conditions and extreme weather events.  Here is a link to a list of the 14 state DOT and five MPO grant recipients. 

• The AASHTO Center for Excellence in Project Finance has compiled a comprehensive listing of state transportation funding proposals that have been or are currently being considered.  Here is a link to the list. 

April 22, 2013 Interim Update

Here is the information just released by US DOT on the Notice of Funding Availability (NOFA) for the FY'13 TIGER V program: 

Today, the Department announced the availability of $473.8 million in funds to be awarded for National Infrastructure Investments (TIGER Funds).  These funds will be awarded on a competitive basis for projects that will have a significant impact on the Nation, a metropolitan area, or a region. 

Please read the NOFA (http://www.dot.gov/policy-initiatives/tiger/tiger-notice-funding-availability-2013 ) for more information about project eligibilities, application requirements, and other important information. 

Our TIGER webpage (http://www.dot.gov/tiger/application-resources ) contains information on past awards, Benefit/Cost Analysis, and other application resources. 

Notable Dates:  The "Apply" function on www.Grants.Gov<http://www.Grants.Gov> will open on Monday, April 29, 2013.  Final applications are due by June 3, 2013.  Unlike last year, a pre-application is not required.  By law, all funds must be obligated by September 30, 2014.  Therefore, applicants must demonstrate that the project can meet all local, State and federal requirements by June 30, 2014.

April 12, 2013 Update

After a delay of over two months while Congress debated sequestration and completed the long overdue FY'13 funding bill, the Administration finally released its FY'14 Budget Request this week.  Both the House and Senate have already passed their respective FY'14 Budget Resolutions and have begun the FY'14 appropriations process, so it is unclear how much influence the Administration's recommendations will have on the funding debate.

Here is a link to the overall federal budget request.  Here is a link to highlights of the US DOT portion of the budget and a link to the annual US DOT "Budget in Brief". 

US DOT FY'14 Budget Request

The US DOT Budget Request for FY'14 looks very familiar to previous years' requests - numerous, very encouraging and forward-looking program recommendations, but no realistic plan for how the new programs would be funded, aside from revenue from a potential "peace dividend" and other revenue sources not identified in the budget.  It is likely that Congress, particularly the Republican majority in the House, will not incorporate many, if any, of the new proposals in their FY'14 DOT appropriations bill. 

Here are the highlights of the Administration's budget request:

1. A one-time $50B appropriation for immediate needs.  This would include $40B for a "Fix it First" program, which President Obama first mentioned in his State of the Union address, targeted towards improving existing infrastructure needs, and $10B for various competitive programs to encourage state and local innovation in infrastructure improvements. 

The $40B "Fix It First" program would include: 

• $25B - critical highway infrastructure
• $9B - critical transit infrastructure ($500M for the New Starts Core Capacity Improvement program, $6B for State of Good Repair (SOGR) projects, $2.5B for urban and rural transit capital programs)
• $2B - existing Amtrak passenger rail service capital investments
• $2B - Airport Improvement Program (AIP) grants
• $2B - Land Ports of Entry/cross border projects 

The remaining $10B is proposed to fund: 

• $4B - TIFIA loan financing and TIGER programs
• $2B - new Transportation Leadership Awards to encourage states and regions to implement innovative strategies
• $3B - existing or new intercity passenger rail corridors - 100% federal share
• $1B - FAA NextGen modernization program ($225M for New York area NextGen facility)

2. The creation of a "Partnership to Rebuild America" that would include $10B to create a National Infrastructure Bank, establish new tax-credit "American Fast Forward Bonds", lift the national cap and expand eligibility for tax-exempt Private Activity Bonds (PABs) used in public-private partnerships, and change the tax treatment of foreign pension funds to attract increased infrastructure investment.  

3. A proposal for a five-year $40B rail reauthorization bill that would boost investments in high-speed and high performance (intercity passenger) rail, improve existing corridors, and strengthen the economic competitiveness of the freight rail system.  Funding would be provided through a newly created Rail Account in the Transportation Trust Fund (the proposed new name for the Highway Trust Fund).  First-year funding under the proposal would total $6.7B.  The current PRIIA rail authorization legislation expires on September 30, 2013.  Congress has indicated that passing a rail reauthorization bill is a priority this year. 

4. The creation of a "reserve fund" in FY'15 to provide for a significantly increased (potentially as much as 25%) reauthorization of MAP-21.  The Administration proposes transferring $214B of general funds to the new Transportation Trust Fund to cover shortfalls in gas tax revenue and fund the growth in highway, transit and rail programs. 

5. FTA - Page 31 of the US DOT Budget in Brief includes the list of Capital Investment Grants (New Start/Small Start/Core Capacity projects) the Administration is proposing to fund in FY'14.  It is important to keep in mind that all funding amounts are subject to the congressional appropriations process and a project could receive more or less than the amount requested.

In addition, FTA has released its FY'14 Annual Report on New Starts and Small Starts.  The report can be downloaded here and individual project profiles can be found here.  Going forward, FTA plans to update the online project profiles throughout the year when projects move from one phase to the next.  A list of the projects that have either advanced in or dropped out of the pipeline can be found on pp.10-11 of the report.  The report recommendations reflect changes to the New Starts program enacted under MAP-21, including the changes to the project development process for New Starts and Small Starts and the inclusion of core capacity projects.

FTA is recommending a total of $2.13B for FY'14 for the New Starts program, including $1.98B in FY'14 Section 5309 (New Starts) funds as well as $151 million in unused, prior-year funds from the Bus and Bus Discretionary Program, the Alternatives Analysis Program, and the Section 5309 Program.  Recommendations include $1.88B for 17 existing and 3 recommended Full Funding Grant Agreements (FFGAs), $113M for 2 existing and 5 proposed Small Starts Construction Grants, and $120M for unnamed core capacity projects.  The New Starts Report (pp. 6-7) also identifies eight new projects which have been approved to advance into Project Development.   

FTA will host a public webcast on their FY'14 budget priorities and the FY'14 Annual Report on Tuesday, April 16 from 12:30 PM to 2:00 PM EDT.  Here is a link to the webcast.

6. FAA - the Administration Budget proposes to reduce funding for the construction-related Airport Improvement Program (AIP) from the authorized level of $3.35B down to $2.90B by eliminating AIP funding for large Hub airports and allowing those airports to increase their Passenger Facility Charges (PFCs), if Congress approves, from the current $4.50 up to $8 to fund airport construction. 

April 9, 2013 Update

Congress is back in session following a two-week recess.  With funding finally resolved for better or for worse for FY'13, Congress will continue to focus its attention on the FY'14 budget and appropriations process.  Both the House and Senate beat the April 15 deadline to pass their respective FY'14 Budget Resolutions, but it seems unlikely that the two resolutions will be reconciled.  The big budgetary news this week is the much delayed release of the Administration's FY'14 budget request on April 10.  The Administration's budget is usually released in early February, but it was delayed this year due to the extended debate on FY'13 funding and the government-wide sequester.  

FY'14 DOT Budget and Appropriations

President Obama provided some early indications of what will likely be included in the Administration's FY'14 budget request for US DOT, when it is released on April 10, in a speech he made recently in Miami.  Following a tour of the Port of Miami and the Port of Miami Tunnel, the President provided more details about his "Rebuild America Partnership" which he mentioned during his State of the Union address in January.  Here is a link to the White House press release.  The President is calling for:

• establishing a $10B National Infrastructure Bank
• creating new "American Fast Forward" (AFF) tax credit bonds
• making tax changes to encourage foreign investment in US infrastructure
• increasing funding up to a total of $4B for the TIFIA and TIGER programs
• lifting the caps on Private Activity Bonds (PABs) for highway and water projects and expanding PAB eligibility for transit, airport and marine projects   

US DOT/FTA is expected to release its FY'14 "New Starts" Report on April 10 along with the budget request.  

The House THUD Appropriations subcommittee has announced its procedures for developing its FY'14 annual appropriation bill for US DOT.  Although no project earmark requests will be permitted, House Members can submit "programmatic and language requests", but must do so by April 26.  Even though US DOT has not yet released its budget recommendations for FY'14, the THUD Subcommittee has started its yearly series of hearings on the modal agency budgets.  On March 21, FTA Administrator Peter Rogoff testified.  Additional hearings are scheduled for April 16 with Secretary Ray LaHood, April 24 on the FAA budget and April 25 on the FRA and Amtrak budgets. 

The Senate has not yet announced its FY'14 appropriations hearing schedule or deadlines for submissions of programmatic directives. 

Hurricane Sandy Funding

On March 29, FTA published two Federal Register notices related to funding for Hurricane Sandy Emergency Relief (ER).  Here is a link to the notice allocating the initial $2B in FTA Sandy ER funding.  The Sandy funding bill required FTA to allocate $2B by March 30.  The focus is on reimbursing affected agencies for costs incurred in the immediate aftermath of the storm.  In addition, here is a link to a list of all the Sandy FTA ER allocations made to date. 

Here is a link to the other Federal Register notice announcing FTA's Interim Final Rule on implementation of the new MAP-21 FTA ER program.  It is effective immediately.  FTA is accepting comments on the Interim rule through May 28. 

Here is a link to the Parsons Brinckerhoff Hurricane Sandy Information Center which tracks rapidly evolving congressional, regulatory and federal agency funding developments following Hurricane Sandy. The site provides links to the final Sandy funding bill, notices of funding availability and funding allocations, Federal Register notices, fact sheets on agency Emergency Relief programs, testimony from Sandy implementation hearings, etc. 

FY'13 TIGER Funding

MAP-21 did not authorize any funding for the US DOT TIGER program in FY'13 and FY'14.  However, one of the few benefits of US DOT being funded under a Continuing Resolution (CR) for FY'13 is that the CR continues to fund programs that were previously funded in FY'12, such as the TIGER program.  The year-long CR, which Congress recently approved, includes $500M for the TIGER program, minus the 5% sequester cut, for a total of approximately $475M.  This will be the fifth round of TIGER funding since TIGER was first created in the ARRA stimulus bill.

US DOT is expected to issue a Notice of Funding Availability (NOFA) for the FY'13 TIGER program very soon.  The application window is expected to be relatively short and the requirements are expected to be similar to last year's.  All modes of surface transportation (highway, transit, bike/ped, freight rail, port, and high-speed intercity passenger rail) are eligible to apply.

Water Resources Development Bill (WRDA)

The Senate Environment & Public Works Committee unanimously approved S. 601, the bi-partisan Senate Water Resources Development Act (WRDA) authorization bill, before leaving for the spring recess.  The leadership hopes to bring the bill to the Senate floor in late April or early May.  Unlike previous WRDA bills, there are no project earmarks in this bill.  The bill simply authorizes those projects (unnamed) that have a completed Army Chief of Engineers' report.  The bill creates a new WIFIA loan program similar to the popular TIFIA program, promotes expedited project delivery, and mandates that current year revenues into the Harbor Maintenance Trust Fund be spent and not held as surplus. 

The House has not yet drafted a companion bill, although the House T&I Committee will hold a bipartisan roundtable discussion this Wednesday at 10:00AM on issues related to the development of a Water Resources Development Act (WRDA). 

Invited participants include: Waterways Council, Inc. President Mike Toohey; National Waterways Conference President Amy Larson; National Association of Flood and Stormwater Management Agencies Executive Director Susan Gilson; American Shore and Beach Preservation Association President Harry Simmons; The Nature Conservancy's North American Freshwater Program Deputy Director Mark Smith; and International Union of Operating Engineers Assistant Legislative and Political Director Jeff Soth.

Here is a link to a brief summary of the Senate bill and a link to the text of the Senate bill - see the first five pages of the 284-page bill for a Table of Contents. 

March 21, 2103 Interim Update

This morning, the House passed the Senate-amended version of H.R. 933, the FY'13 full-year continuing appropriations (CR), by a vote of 318 to 109, clearing the measure for the President, who is expected to sign it shortly in advance of the March 27 expiration of the current CR.  The Senate passed the amended bill last night by a vote of 73 to 26.  The bill funds all federal agencies through the end of the fiscal year - September 30, 2013. 

Below is information about the final FY'13 funding levels for various transportation and other infrastructure programs.  Here is a link to the transportation section of the bill - Title VIII of Division F. 

Earlier today, the House passed its FY'14 budget resolution (H. Con. Res 25) by a mostly party-line vote of 221 to 207.  The Senate will debate its FY'14 budget after the spring recess. 

Congress will begin a two-week recess tomorrow. 

The latest rumored replacement for US DOT Secretary LaHood is Charlotte Mayor Anthony Foxx.  Foxx is a prominent African American Democratic mayor and is a strong proponent of transportation, especially the Charlotte streetcar and light rail projects.  He served as host of the 2012 Democratic Convention.  No word from the White House on the validity of this rumor. 

March 18, 2013 Update

Between the sequester, the FY'13 Continuing Resolution and the FY'14 House and Senate Budget Resolutions, Congress has been very busy these past two weeks.  However, that activity has also made it very confusing to keep track of the funding implications for critical infrastructure programs potentially affected by all three.  Here is a breakdown of the key activity. 

Sequestration - Despite the fact that the government-wide, across-the-board cut was never intended to actually go into effect - it did so on March 1.  The result is an approximately 5% cut on almost all domestic discretionary programs for FY'13, the current fiscal year.  Although grant programs funded with revenue from the Highway and Aviation Trust Funds (highway, transit formula and AIP programs) are exempt from sequestration, other programs such as FTA's New Starts/Small Starts, Amtrak Operations and Capital, FAA Operations, Hurricane Sandy Emergency Relief, etc. are impacted.  The original expectation was that Congress would nullify the sequester or at least provide agencies with some flexibility on where to take the cuts when they debated the second FY'13 Continuing Resolution (CR), but that did not happen.  The cuts imposed are now in place for FY'13 and the reduced spending levels become the baseline for future years unless Congress acts to lift them.  

FY'13 Continuing Resolution - Last fall, Congress opted to pass a six-month Continuing Resolution through March 27, 2013, which kept most program funding at the lower FY'12 levels, instead of trying to pass the 12 individual federal agency FY'13 appropriations bills before the November elections.  With expiration of the CR looming and Congress leaving for a two-week recess on March 22, the House last week passed another CR through the end of the fiscal year, September 30, 2013.  Unfortunately, the House version of the CR (HR 933) funds all domestic discretionary and defense programs at the lower levels required by the sequester and does not provide agencies any flexibility to manage the cuts.  Highway and transit Trust Fund programs, while not affected by the sequester, are proposed in the House CR to be cut by more than $700M below MAP-21 authorized levels for FY'13.  

Late last week, the Senate began debate on a substitute version of the House CR and is in the process of considering amendments to it.  Here is a link to information about the Senate CR.  Contrary to expectations, the Senate also did not restore the sequester funding cuts for most federal programs, but it did reverse the House CR cuts to the Highway Trust Fund programs, funding them at their MAP-21 authorized levels, a huge victory for the industry.  

The Senate hopes to finish debate and pass the CR later tonight.  The bill will then go back to the House for final approval.  Since the two bills are not significantly different overall, the hope is that the House will agree to the Senate version and then the bill will go to the President to sign (which he is expected to do).  However, if some of the more controversial amendments pending on the Senate floor pass, such as amendments related to Amtrak funding and restoring funding for the FAA's contract tower program, the House could vote to drop them and then pass the bill back to the Senate again, extending the debate for several days.  

Neither the House nor the Senate versions of the US DOT CR include specific funding allocations for projects under the FTA New Starts/Small Starts program.  Once a final bill is signed into law, FTA will have the discretion to allocate these traditionally, congressionally earmarked funds.  The significant cuts to this General Funded program will make funding any projects without an existing Full Funding Grant Agreement very difficult and may even require cutting some FFGA projects.  

FY'14 Budget Resolution - Even though Congress has not yet completed action on funding for the remainder of FY'13, work has already begun on the FY'14 Budget Resolution.  The Budget Resolution is a non-binding "blueprint" which provides guidance for the appropriations committees as they draft their FY'14 federal agency appropriations bills.  It provides revenue and outlay assumptions over ten years.  

Usually, the annual budget process kicks off when the White House releases its budget request in early February.  This year the White House's recommendations are not expected to be released until April 9 because the Administration has been preoccupied with the sequester and completing the FY'13 bill.  However, Congress cannot wait for the Administration because as part of the January agreement to temporarily increase the debt ceiling, the House and Senate must pass their respective FY'14 Budget Resolutions by April 15 or face a loss of pay.  

House Budget Committee Chairman Paul Ryan (R-WI) introduced a House Budget Resolution last week which is similar to those he has drafted in past years.  It was quickly passed by the House Budget Committee and will come to the floor this week.  Its priority is balancing the federal budget entirely through spending cuts.  Building on his past statements, Ryan is highly critical of the highway and transit programs saying, "The mechanisms of federal highway and transit spending have become distorted, leading to imprudent, irresponsible, and often downright wasteful spending.  Further, however worthy some highway projects might be, their capacity as job creators has been vastly oversold....".  His budget requires that any future transfers of General Funds to the Highway Trust Fund must be offset with cuts in other spending.  While no programmatic estimates have been provided, it is thought that the Ryan budget would entail cuts in the range of 25% from current levels for infrastructure programs.  

The Senate Budget Resolution will be debated on the Senate floor later this week, once the CR is completed.  The Senate version is much more favorable to infrastructure programs.  It recommends a $50B immediate transportation investment, $10B for an infrastructure bank, and "reserve" funds to allow for general infrastructure and water infrastructure spending increases (if the Finance Committee identifies a funding source to pay for them). 

Because the two Resolutions are so different in approach, it is unlikely that they will ever be reconciled. 

Debt Ceiling - In late January, Congress agreed to support a temporary, three-month increase in the debt ceiling in order to avoid a government default.  The ceiling will need to be addressed again very shortly.  At one time, many thought the next debt ceiling bill would become the vehicle for a "grand bargain" that would revisit the sequester, reform the tax code, cut entitlements, and perhaps even include a gas tax increase, but that looks unlikely now.  It is still possible that Congress may revisit these issues, particularly tax reform, later this fall, which could become the vehicle for a transportation revenue increase.  

MAP-21 Implementation 

MAP-21 Oversight - The House T&I Committee held a hearing on implementation of the MAP-21 authorization bill on March 14.  Here is a link to background materials on the hearing and the testimony from the Administrators of FHWA, FTA, FMCSA, and NHSTA. 

Transit Provider Representation in MPOs - FTA is hosting a national online dialogue on MAP-21 provisions requiring representation by providers of public transportation in Metropolitan Planning Organizations (MPOs).  Here is a link to the Dialogue which closes on March 25.  

New Categorical Exclusions (CEs) - On February 28, FHWA/FTA issued an NPRM in the Federal Register requesting comments by April 29 on the creation of two new CEs.  Sections 1316 and 1317 of MAP-21 encourage the expansion of CEs in an effort to streamline project construction.  The new exclusions are for projects being built within an existing right-of-way and projects involving less than $5M in federal funds or with a total estimated cost of not more than $30M and federal funds comprising less than 15% of the total project cost.  Here is a link to the Notice.  

Categorical Exclusions for Emergency Actions - On February 19, FHWA/FTA issued a Final Rule per MAP-21 Section 1315 expanding the types of existing CEs for emergency actions to include repair of transportation facilities damaged by an incident resulting in an emergency declaration.  Here is a link to the Notice.  

Other News 

WRDA - Later today, the Senate Environment and Public Works Committee is expected to introduce a bi-partisan Water Resources Development Act (WRDA) authorization bill to fund Corps of Engineer projects.  The bill will be marked up by the EPW Committee on Wednesday, March 20 at 10:00am.  The bill addresses levee and dam safety, inland waterways, extreme weather events, TIFIA-like innovative financing, and the Harbor Maintenance Trust Fund.  Here is a link to the full text of the Senate bill.  A summary of the bill will be available shortly. 

FTA Joint Development - FTA released the long awaited draft Circular on Joint Development.  Here is a link to the Circular. Comments are due by April 5.  

FTA Program Management - FTA has withdrawn its proposed rule on Program Management pending consideration of programmatic changes authorized in MAP-21.  

Sandy MOA - FTA and FEMA signed a Memorandum of Agreement (MOA) on how they will coordinate to implement the new Hurricane Sandy emergency relief efforts.  FTA is expected to issue a Federal Register notice in the next several weeks outlining how the newly authorized and funded Emergency Relief program will allocate funding.  Here is a link to the MOA. 

Rail Hearing - The House T&I Railroad Subcommittee held a hearing on the importance of freight and passenger rail to the US economy on March 5.  Here is a link to background on the hearing and the witness testimony which included AAR, Amtrak, UTU and States for Passenger Rail.  

AASHTO Database of State Transportation Finance and Governance - The database provides detailed state profiles which include revenue tools, financing mechanisms and governance structures in both mapped and tabular forms.  Here is a link to the new Online Database which was developed for AASHTO by Parsons Brinckerhoff. 

March 6, 2013 Update

As of Friday, March 1, the $85B FY'13 government-wide sequester which most everyone agreed would never actually go into effect - did.  Below is a chart, based on information released by OMB, showing how US DOT and other infrastructure programs will be affected, at least until Congress passes legislation to fund the federal government for the remainder of FY'13 which could negate or reallocate some of the funding cuts.

Since Congress was not able to pass any of the individual federal agency FY'13 appropriations bills last fall prior to the November 2012 elections, they opted to pass a temporary Continuing Resolution (CR) that funded federal programs at essentially their FY'12 levels for six months through March 27.  While six months seemed like a long period of time back in September, the expiration of the CR is now upon us, especially since Congress is scheduled to begin a two-week recess on March 22.  The House has introduced its version of an additional six-month CR to finish out the fiscal year and plans to debate and pass it on the House floor today. 

The draft House CR (HR 933) includes the lower funding levels required by the government-wide sequestration.  The Senate CR, which has not yet been introduced, is anticipated to ease some of the pain by providing flexibility for agencies to protect critical programs from the severest cuts.  At US DOT, any flexibility is likely to be used to restore funding for critical safety programs and personnel in order to avoid or lessen employee furloughs.  This could potentially result in even deeper cuts in other less critical programs. 

The House CR does not fund highway and transit programs (those funded through the Trust Fund) at the higher levels authorized in MAP-21.  The House CR funding level is actually $742M below the FY'13 MAP-21 authorized level for these programs.  Transportation industry groups have urged Congress to honor the MAP-21 funding levels. 

The House CR also does not incorporate the MAP-21 authorized changes in the FTA Capital Investment program structure and the FTA Research and University Transportation Center program structure, but does include various MAP-21 authorized changes to the FTA Formula program structure.  

Looking forward, there is no end in sight for an easy or quick resolution to this funding crisis.  The Budget Control Act mandates annual sequesters over the next ten years in order to achieve a total of $1.2 trillion in government-wide cuts.  Also, the House and Senate must each pass a FY'14 Budget Resolution by April 15 or face a loss in pay.  However, the White House does not expect to release its FY'14 Budget Request until early to mid-April, after the CR is passed, and possibly after the House and Senate have already completed their FY'14 budgets.  In addition, the debt ceiling crisis, which was averted in January when Republicans agreed to support a three-month increase in the ceiling, will need to be addressed again starting in mid-May.