House Democrats are advocating for a second economic stimulus bill and infrastructure funding, including highway funding, is being discussed. AGC has sent a letter to the House pointing out the job creation benefits that results from infrastructure funding and pointing out that rising construction material prices and inadequate state budgets have resulted in fewer publics works projects going out for bid. In the case of highway projects, AGC pointed out that state DOTs have responded to an AASHTO survey indicating that over 3000 highway contracts could go out to bid within 90 days if additional federal funds were made available.

By a vote of 372-56, the House of Representatives today passed a continuing resolution (CR) to provide partial funds for Fiscal Year 2009 for those federal programs for which a free standing appropriations bill had not been passed, including the Department of Transportation. Fiscal Year 2009 begins on October 1, 2008 and the CR provides funds from then through March 6, 2009. Under the terms of the CR, programs will be funded at their FY 2008 level. For the Federal-aid highway program the FY 2008 funding level is $41.216 billion which included $1 billion above the SAFETEA-LU authorized level for a bridge repair initiative. It is anticipated that the additional $1 billion will not be included in this CR’s partial funding and therefore the highway program will receive a prorated share of $40.2 billion through March 6. SAFETEA-LU authorizes $41. 2 billion for the highway program in FY 2009. When the new Congress takes over in January it will be necessary to pass an additional appropriations measure to fund government programs for the remainder of the fiscal year and at that time could restore the full SAFTEA-LU funding. The transit program receives a prorated share of $9.4 billion. The Highway Trust Fund fix, which was enacted on September 15, ensures that the revenue is available to fund these appropriated levels for the highway and transit programs. Congress is scheduled to adjourn by the end of the week and passage of a CR is necessary to keep government agencies running. The Senate is expected to pass the CR as soon as it is sent over from the House.

Taking the final step necessary to ensure that the payment of Federal-aid highway funds to states will continue uninterrupted, President Bush on September 15 signed HR 6532. The legislation transfers $8 billion from the US Treasury's general fund to the Highway Trust Fund (HTF).

The House of Representatives today approved H.R. 6532 transferring $8 billion from the general fund of the Treasury to the Highway Trust Fund (HTF). The vote was 376 in favor and 29 Republicans voting against. House action was necessary because the original version of H.R. 6532 transferred the funds on October 1. The Senate yesterday amended the bill to allow the transfer to happen when the president signs the bill, which is expected by the end of the week. This immediate transfer was necessary because the HTF does not have a sufficient balance to fully reimburse states for payments they have made on ongoing federal-aid highway contracts. Once the bill is signed FHWA will resume its long standing procedure of reimbursing states on a daily basis for the full amount submitted.The transfer of these funds reimburses the HTF for $8 billion that was taken from the HTF in 1998, as part of the TEA-21 negotiations. At that time, the HTF had a large balance and the $8 billion was a trade off for fire wall protection of the HTF and funding guarantees. With this action completed, there should be a sufficient balance to fully fund SAFETEA-LU through its full authorization period which expires on September 30, 2009.AGC worked very closely with our chapters and our construction and transportation industry allies to generate the support necessary to have this legislation enacted. Thank you to all who took the time to communicate with your Congressional delegations.

On a voice vote today the Senate today passed HR 6532, legislation transferring $8 billion from the general fund of the Treasury to the Highway Trust Fund to prevent a shortfall in available funds from slowing down Federal reimbursements to states for on-going federal-aid highway construction projects. The Senate amended the House bill to allow for the transfer to happen immediately rather then on October 1st. The House must now approve the amended bill which is expected to occur this week. The President is expected to sign the bill expeditiously.This action caps off several days of intense negotiations with three Republican Senators who were seeking to offer amendments to the bill and were also requesting a roll call vote on the measure.In an announcement last week Transportation Secretary Mary Peters reported on the dire situation in HTF revenue which, if not remedied, will result in a slow down and reduction in payments to state DOTs. At that time she called on Congress to pass HR 6532. Numerous state DOTs announced that, if the full federal funds were not forthcoming, that they would be forced to cancel contract lettings, slow down work on on-going projects and, in some cases, issue debt to make payments to contractors.AGC chapters and members responded to AGC of America's many pleas for contacts with Congressional delegations on this legislation. Thank you for your help.

Secretary of Transportation Mary Peters today acknowledged that the Highway Trust Fund has an insufficient balance to continue to make full and timely payments to reimburse states for on-going Federal-aid highway construction projects and will be forced to reduce payments starting the week of September 8. The Administration projected that by the end of September the balance in the Highway Trust Fund will be zero. Secretary Peters pointed out that an infusion of revenue into the HTF is necessary to prevent further disruptions to the highway program and called on Congress to pass a "clean" bill transferring $8 billion in revenue into the HTF by next Friday. The House has already passed H.R. HR 6532, legislation sponsored by Ways and Means Committee Chairman Charles Rangel (D-NY), T&I Committee Chairman Jim Oberstar (D-MN) and the bipartisan T&I Committee leadership, to make the $8 billion transfer. Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Committee Republican Chuck Grassley (IA) have been championing the effort in the Senate to include the HTF fix as part of other legislative initiatives. Their efforts have been stifled by the Administration’s opposition. Just last July, the Administration issued a Statement of Administration policy threatening a veto of the Rangel/Oberstar bill. Senate opposition has also come from Sen. Jim DeMint (R-SC), Judd Gregg (R-NH) and Sen. Tom Coburn (R-OK).Standard operating procedures currently are for FHWA to reimburse states twice daily as they submit vouchers for payment. The procedures announced today will have FHWA making payments to states once per week on Thursdays and at a reduced rate. States will be reimbursed on a pro-rata basis, based on the amount of funds available at the time payments are made. The longer it takes to get new revenue into the HTF the greater the subsequent percentage reductions in payments will be.AGC has been working closely with our construction industry and transportation allies calling on Congress and the Administration to work together to guard against HTF insolvency since its financial instability became apparent in the President’s 2007 budget proposal, submitted to Congress in February 2006.  AGC will be urging the Senate to heed the Department’s call to enact this legislation by the end of next week and send it to the President’s desk.

The Associated General Contractors of America (AGC) today commended the House Transportation and Infrastructure Committee for conducting a hearing on the National Surface Transportation Policy and Revenue Study Commission's report to Congress and called on Congress to give due consideration to the report's bold and visionary plan for the future of surface transportation policy in the United States. Read the full Press Release.

The AGC/Chamber of Commerce Americans for Transportation Mobility coalition has released a study highlighting links between nation's transportation system and U.S. economic productivity, competitiveness, and growth.