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Congress Passes Highway Bill

Mon July 02, 2012 - National Edition
Alan Fram and Joan Lowy - ASSOCIATED PRESS

Congress emphatically approved legislation Friday preserving jobs on transportation projects from coast to coast.
Congress emphatically approved legislation Friday preserving jobs on transportation projects from coast to coast.

WASHINGTON (AP) - Congress emphatically approved legislation Friday preserving jobs on transportation projects from coast to coast and avoiding interest rate increases on new loans to millions of college students, giving lawmakers campaign-season bragging rights on what may be their biggest economic achievement before the November elections.

The bill sent for President Barack Obama’s signature enables just over $100 billion to be spent on highway, mass transit and other transportation programs over the next two years, projects that would have expired Saturday without congressional action. It also ends a bare-knuckle political battle over student loans that raged since spring, a proxy fight over which party was best helping voters muddle through the economic downturn.

Obama signed a one-week temporary measure Friday evening, permitting the highway and loan programs to continue until the full legislation reaches his desk.

Under the bill, interest rates of 3.4 percent for subsidized Stafford loans for undergraduates will continue for another year, instead of doubling for new loans beginning on Sunday as scheduled by a law passed five years ago to save money.

Had the measure failed, interest rates would have mushroomed to 6.8 percent for 7.4 million students expected to get the loans over the coming year, adding an extra $1,000 to the average cost of each loan and antagonizing students - and their parents - four months from Election Day.

The Democratic-led Senate sent the measure to Obama by a 74-19 vote, just minutes after the Republican-run House approved it 373-52. The unusual display of harmony, in a bitterly partisan year, signaled lawmakers’ eagerness to claim credit for providing transportation jobs, to avert higher costs for students and their families and to avoid being embarrassed had the effort run aground.

This year has seen the two parties mostly drive each other’s plans for tax breaks and economic revival into a stalemate, although lawmakers have enacted bills retaining the Social Security payroll tax cut for a year and renewing a government agency that promotes U.S. exports.

“It’s important for Congress to act, not just talk about problems we have but to get things done,” said Rep. John Mica, R-Fla., a chief House author of the transportation measure.

“We have a bill that will boost this economy,” said Sen. Barbara Boxer, D-Calif., a sponsor who said the measure would create or save 2.8 million jobs. “We have a bill that is supported by conservatives and liberals, progressives and moderates. I think this is a great day.”

All the no votes were cast by Republicans.

The compromise ended up sprinkled with unrelated nuggets dealing with Asian carp, roll-your-own tobacco and federal timber aid. But its most significant provisions dealt with transportation and student aid.

The final transportation measure dropped a provision - which had drawn an Obama veto threat - that would have forced government approval of the controversial Keystone XL oil pipeline from Canada to the Texas coast. But it contains curbs on environmental reviews of transportation projects. Republicans sought those curbs in hopes of cutting construction time almost in half.

The bill consolidates federal transportation programs and gives states more flexibility in spending money from Washington. It also contains an array of safety initiatives including requirements aimed at enhancing bus safety. And it makes advocates of bike and pedestrian paths compete for money with other transportation projects.

White House spokesman Jay Carney said the administration was glad Congress acted “before middle class families pay the price for inaction.” He said Obama will keep pressing for approval of more of his job-creating proposals from last year, to hire teachers, police officers and firefighters and for tax credits to companies that hire new workers.

Most of the overall measure was financed by extending federal taxes on gasoline and diesel fuel for two more years. Those levies, unchanged for nearly two decades, are 18.4 cents a gallon for gasoline and 24.4 cents for diesel and now fall well short of fully financing highway programs, which they were designed to do.

Industry reaction noted that the bill’s passage is only the first step in a longer process. The American Road & Transportation Builders Association (ARTBA) President & CEO Pete Ruane issued the following statement:

“In the short term, the bill will provide stability in federal funding for state and local transportation projects. The elimination of earmarks should also accelerate the speed at which federal funds impact the market for transportation improvements. That’s the good news.

“The bad news is there is no new money. And even with their federal funds, we are now in a situation where 28 states have invested less in highway and bridge projects over the past 12 months than they did in pre-recession 2008, even when adjusted for inflation.

“We view this bill—as we believe congressional leaders do—as just ’Step One,’ which is making the significant program and policy reforms needed to restore public confidence in how the federal government is investing their money in transportation and mobility.

“’Step Two’ is coming to grips with how to fund the nation’s investments in transportation infrastructure and mobility over the longer term. That tough job remains. And it will require the same bipartisan, bicameral leadership and cooperation that was ultimately demonstrated on this bill.

“Our mission is crystal clear: to do everything possible to ensure that the proper level of transportation investment is viewed as a core priority as the looming larger discussion and legislative activity begins in earnest on Capitol Hill to define the proper role of the federal government in the 21st century and how it utilizes the public’s money.

“We commend Senate Majority Leader Harry Reid (D-Nev.), House Speaker John Boehner (R-Ohio), Senate Environment & Public Works Committee Chair Barbara Boxer (D-Calif.), EPW Ranking Member Jim Inhofe (R-Okla.), Senate Finance Committee Chairman Max Baucus (D-Mont.), House Transportation & Infrastructure Committee Chairman John Mica (R-Fla.), and T&I Committee Ranking Member Nick J. Rahall (D-W.Va.), for their steadfast leadership and dogged determination to get the job done.“

The Association of Equipment Manufacturers (AEM) Chair Rusty Fowler also commented on the passage of the bill:

"On behalf of AEM, the 21,000 members of the I Make America campaign and all of our industry allies, we appreciate Congress coming together to pass a surface transportation bill. This long overdue legislation is critical to market certainty and economic growth, and I encourage the President to sign this into law without delay.

"While we fully understand that the House and Senate did what they could to get a bill passed, we also want to remind them that there is still more work to be done. The comprehensive infrastructure investment our country needs requires a long-term strategic vision and a well-structured, sustainable funding mechanism in order to be effective. The much-needed two years of market certainty provided by the legislation passed in Congress today should be used by all to continue working on a more effective infrastructure solution to keep America strong and competitive for years to come."

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