Moving a Mountain? No, It s Just a Transportation Bill!

Transcription

1 Mving a Muntain? N, It s Just a Transprtatin Bill! Jung H. Lee Assciate Directr fr Finance and Business Develpment American Assciatin f State Highway and Transprtatin Officials Deputy Directr AASHTO Center fr Excellence in Prject Finance 1

2 SESSION OBJECTIVES 2 T prvide an update n state spending levels T reprt and shw lessns learned frm Recvery Act implementatin T discuss the state t f current surface transprtatin funding, including the Federal Highway Trust Fund cnditins T prvide AASHTO s funding framewrk fr the future T give the latest update n current prgram extensin and surface transprtatin reauthrizatin

3 STATE SPENDING PICTURE 3

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6 Transprtatin Spending Cuts in 21 States in FY 2010 Arizna Califrnia Cnnecticut Flrida Gergia Kansas Luisiana Massachusetts Maine Michigan Mississippi Nevada Nrth Carlina New Jersey New Yrk Ohi Pennsylvania Suth Carlina Virginia Washingtn Wiscnsin 6 Surce: Natinal Assciatin f State Budget Officers

7 ECONOMIC RECOVERY 7

8 8 American Recvery and Reinvestment Act (ARRA) f 2009 Overall Features $48.12 billin t USDOT 100 percent Federal share Maintenance f effrt required Peridic reprting f ecnmic impact f stimulus spending $1.5 billin in TIGER discretinary grants (Up t $200 millin fr TIFIA credit assistance)

9 Highways $27.5 billin ttal Recvery Act Prvisins Met statutry 100% bligatin gal Transit $8.4 billin ttal Met statutry 100% bligatin gal Passenger Rail $8 billin fr intercity passenger and high speed rail Grants awarded 28 January 2010 $1.3 billin fr Amtrak Aviatin 9 $1.3 billin ttal

10 Recvery Act Prgress Reprt Federal Highway Administratin reprts as f 29 January: 11,100 highway prjects have wn federal apprval t prceed 7,050 highway prjects are under cntract r ready t prceed 2,140 prjects are already cmpleted Federal Transit Administratin reprted as f 4 February: It had bligated $7.2 billin f its recvery funding t ver 700 prjects, nearly 87 percent f available funding Anther 220 prject applicatins, valued at $1.1 billin were under review Bids have cme in acrss the cuntry at 10% t 30% under estimates, leading t mre wrk being 10 accmplished

11 Recvery Act Prgress Reprt 11 As f 7 January 2010: 1,125 bridges had been imprved, replaced r newly cnstructed 21,400 miles f pavement were either imprved, resurfaced r widened 1,700 miles f safety traffic management prjects were implemented Over 630 miles f bike lanes, sidewalks r envirnmental mitigatin prjects were underway 7,450 buses have been purchased and 1,637 bus shelters cnstructed

12 Recvery Act Jbs Impact 280, direct, n prject jbs have been created r sustained acrss the cuntry Ttal emplyment frm these prjects, which includes direct, indirect, and induced jbs, reaches almst 890,000 jbs 12

13 13 Ecnmic Recvery Key Pints State DOTs are utilizing stimulus dllars quickly and demnstrating accuntability Hwever, ecnmic recvery plan cannt be a substitute fr lng term investment gals that must be articulated and implemented in the full transprtatin authrizatin

14 CURRENT TRENDS AND CHALLENGES 14

15 Sep 09 Jan 10 3,100 3,050 3,000 2,950 2,900 2,850 2,800 Vehicle Miles Traveled January 2004 t January 2010 (Mving 12 Mnth Ttal) Sep 04 Jan 05 May 05 Sep 05 Jan 06 May 06 Sep 06 Jan 07 May 07 Sep 07 Jan 08 May 08 Sep 08 Jan 09 May 09 Jan 04 May 04 (Billins f M iles)

16 ,500 4,000 3,500 3,000 2,500 2,000 1,500 1, Truck, Buses, and Trailer Retail Tax Receipts ( ) Millins f Dllars (2008 C nstant)

17 Highway Accunt f the Highway Trust Fund: Receipts and Outlay Discrepancy ($ billins s) $41.8 $30.4 -$ Actual Estimated Negative Annual Cash Flw Highway Accunt Outlays Highway Accunt Receipts *Excludes $8.017 billin transfer frm General Fund t Highway Accunt f HTF in September **Excludes $7 billin transfer frm General Fund t Highway Accunt f HTF in August 2009.

18 Surce: Federal Highway Administratin

19 Reduced Highway and Transit Prgram Levels Highways Transit lins) ($ bil Nte: Baseline prjectin frm FY 2010 Budget using CBO Summer 2009 baseline receipts estimates

20 Purchasing Pwer Lss f the Highway Prgram (Bill lins) $60 $50 $40 $30 $20 $10 $- $32.5 $42.0 $51.8 $55.0 FY 2003 Actual FY 2003 Yung- Funding Level Enacted as f May 2008 Inflated fr Cst Increases Oberstar $375 Billin Prpsal (PPI) Surce: Transprtatin Weekly

21 Surface Transprtatin Authrizatin 21

22 22 Surface Transprtatin Authrizatin Act f 2009 Funding Ttal funding $450 billin; a$500 billin with High Speed Rail $337.4 billin in Highway investment $100 billin fr Capital Asset Imprvement (NHS, IM, Bridge) $50 billin fr Metrplitan Mbility and Access (MMA) $25 billin fr Prjects f Natinal Significance $162.4 billin fr ther FHWA administered prgrams (e.g. Highway Safety Imprvement, Surface Transprtatin, CMAQ, Freight, etc) $99.8 billin transit $87.6 billin frm HTF HTF share was 15.2% in SAFETEA LU; it is increased t 19.5% in STAA $12.2 billin frm GF $50 billin high speed rail crridrs $12.6 billin Mtr Carrier Safety

23 Surface Transprtatin Authrizatin Act f 2009 Specific authrizatins are nt included in the bill nr are the apprtinment frmulas While the tp line numbers are in the bill there is n specific breakdwn by categry and n frmulas r runs that wuld shw state shares r return n cntributins There is n revenue title t be bill yet 23

24 AASHTO s Vastly Expanded d Funding Prpsal 24

25 Legislative Recmmendatins Between 2010 and 2015, in rder t invest in a rbust surface transprtatin prgram t meet significant natinal needs, Cngress shuld fund a $565 billin multimdal prgram cmprised f: Highway prgram funded at $375 billin (2015 level = $75 billin) Transit prgram funded at $100 billin (2015 level = $20.8 billin) Freight prgram funded at $40 billin (2015 level = $9.2 billin) Intercity passenger rail prgram funded at $50 billin 25 (2015 level = $11.7 billin)

26 Legislative Recmmendatins Federal gvernment must cntinue t play a strng rle in investing and maintaining an integrated and multimdal natinal surface transprtatin system Given the magnitude and diversity f needs, develp plicies that supprt flexible use f bth cnventinal and innvative funding and financing tls. In additin, states and lcal gvernments shuld be prvided with maximum flexibility t use federal revenues frm existing cre surces t meet systemic transprtatin needs. Strng accuntability measures must accmpany substantially increased funding t ensure resurces are spent as efficiently and effectively as pssible 26

27 27 Legislative Recmmendatins We need t restre purchasing pwer by making sure the impact f inflatin n cmmdities and cnstructin csts must be addressed in setting investment levels Adpt a lng range apprach ht funding the surface transprtatin system that gradually mves away frm dependence n the current mtr fuels tax t a distancebased direct user fee such as a fee n vehicle miles traveled Assure that any climate change legislatin that creates a new revenue surce, either thrugh a carbn tax r cap andtrade, prvides substantial funding fr transprtatin Eliminate r drastically limit earmarking in federal transprtatin prgrams

28 Surface Transprtatin Funding Optins Matrix (all revenue estimates in $millins) Annual Average Annual Ttal Mechanism Yield Illustrative Revenues Revenues Revenues Funding Mechanisms (2010) Rate Annual Highway Miles Traveled Fee (Cars Only) 1 /VMT = $ 17, $ 17,298 $ 17,616 $ 105,696 Annual Highway Miles Traveled Fee (All light duty vehicles) 1 /VMT = $ 27, $ 27,610 $ 28,682 $ 172,094 Annual Highway User Vehicle Fee $1.00 Fee = $ 263 $1.00 $ 263 $ 275 $ 1,652 Carbn Tax r Cap And Trade Auctin Prceeds 1 /gal r equiv = $ $ 16,594 $ 17,250 $ 103,501 Cntainer Tax $1 per TEU = $ 57 $20.00 $ 1,137 $ 1,336 $ 8,013 Diesel Tax Increase Plus Indexing 1 /gal = $ $ 5,337 $ 5,976 $ 35,856 Existing Highway Trust Fund Surces $ 40,566 $ 42,569 $ 255,413 Gas Tax Increase Plus Indexing 1 /gal = $ 1, $ 13,796 $ 15,082 $ 90,489 General Fund Supprt fr Intercity Passenger Rail $ 3,000 $ 3,000 $ 18,000 General Fund Transfers fr Transit $ 3,167 $ ,167 $ 19,000 Index Existing Highway Trust Fund Surces Beginning in 2010 $ 791 $ 3,032 $ 18,192 Index Heavy Vehicle Use Tax Retractively t 1997 $ 411 $ 536 $ 3,217 Interest n Highway Trust Fund Balances $ 200 $ 200 $ 1,200 Mtr Fuel Tax Exemptin Reimbursement (Retractive and Future) $ 1,057 $ 1,099 $ 6,593 Sales Tax n Mtr Fuels 1.0% f Sales = $ 6, % $ 15,340 $ 15,658 $ 93,949 Share f US Custms Revenues 1% f Receipts = $ % $ 1,570 $ 1,817 $ 10,904 Tax Credit Bnds fr Highways and Transit $ 8,333 $ 8,333 $ 50,000 Tax Credit Bnds fr Intercity Passenger Rail $ 4,167 $ 4,167 $ 25,000 Tn Freight Charge -- All Mdes 1 /tn = $ $ ,617 $ ,801 $ 10,804 Tn Freight Charge -- Truck Only 1 /tn = $ $ 1,115 $ 1,242 $ 7,452 Tn-Mile Freight Charge -- All Mdes 1 /tn-mile = $ 42, $ 4,276 $ 4,763 $ 28,579 Tn-Mile Freight Charge -- Truck Only 1 /tn-mile = $ 12, $ 1,252 $ 1,394 $ 8,365 US Freight Bill -- All Mdes 1% f Sales = $ 7, % $ 7,708 $ 8,585 $ 51,513 US Freight Bill -- Truck Only 1% f Sales = $ 6, % $ 6,497 $ 7,237 $ 43,420 Vehicle Sales Tax n New Passenger Cars/Light-duty Trucks 1% f Sales = $ 4, % $ 9,707 $ 10,812 $ 64,870 Vehicle Sales Tax n New/Used Passenger Cars/Light-duty Trucks 1% f Sales = $ 9, % $ 18,024 $ 20,077 $ 120,461 Ttal Revenues $ 210,831 $ 225,705 $ 1,354,232

29 Prpsed Prgram Funding Levels t Restre Purchasing Pwer Ptential Prgram Name TOTAL Preservatin and Renewal $28.00 $30.80 $33.60 $36.40 $39.20 $42.00 $ Highway Freight (Based n Existing Revenues) $2.40 $2.64 $2.88 $3.12 $3.36 $3.60 $18.00 Highway Safety Imprvement Prgram $2.60 $2.86 $3.12 $3.38 $3.64 $3.90 $19.50 Operatins $2.40 $2.64 $2.88 $3.12 $ $3.60 $18.00 Transprtatin System Imprvement/Cngestin Reductin $11.10 $12.21 $13.32 $14.43 $15.54 $16.65 $83.25 Envirnment Prgram $3.50 $3.85 $4.20 $4.55 $4.90 $5.25 $26.25 TOTAL - Highways $ $55.00 $ $65.00 $ $75.00 $ TOTAL - Transit $12.5 $14.2 $15.8 $17.5 $19.2 $20.8 $ TOTAL - Freight (Based n New Revenues Outside f Highway Trust Fund) $4.2 $5.2 $6.2 $7.2 $8.2 $9.2 $40.00 TOTAL - Intercity Passenger Rail $5.0 $6.3 $7.7 $9.0 $10.3 $11.7 $50.00 GRAND TOTAL $71.67 $80.67 $89.67 $98.67 $ $ $565.00

30 CURRENT STATE OF PLAY 30

31 31 Hiring i Incentives t Restre Emplyment (HIRE) Act HR 2847 $17.6 billin package Signed int law n 18 March 2010 SAFETEA LU Extensin Extends SAFETEA LU at pre rescissin FY 2009 spending level until 31 Dec 2010 Credits Highway Trust Fund with $19.5 billin in fregne interest payments Allws Highway Trust Fund t accrue interest Fuel tax credit fr exempt fleet t be cvered by the General Fund Restres the $8.7 billin cntract authrity rescissin cntained in SAFETEA LU Build America Bnds expansin t cver ther qualified tax credit bnds

32 Current State f Play Obama Administratin is currently undertaking reauthrizatin i Listening i Sessins arund the cuntry 1 Dec 09 kickff in New Orleans 25 Jan 10 in Minneaplis with Huse T&I Chairman James Oberstar 19 Feb 10 in Ls Angeles with Senate EPW Chairman Barbara Bxer 32

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34 Current State f Play 34 There is great uncertainty right nw Still n slutin n paying fr a six year bill Senatr Vinvich received prmise frm Senatr Reid t pass reauthrizatin by the end f the year Senatr Bxer prmises t mark up the EPW bill by the end f the year USDOT principles frthcming Earmarks ban in the Huse

35 Current State f Play 35 Brader variables: unemplyment situatin and deficit spending appetite It is imprtant t pass the six year authrizatin bill sn, as state DOTs and cntractrs depend n lng term investment time hrizns Any actin shuld nt reverse the prgress made thrugh the stimulus legislatin

36 Thank Yu Jung H. Lee Assciate Directr fr Finance and Business Develpment AASHTO American Assciatin f State Highway and Transprtatin Officials 444 Nrth Capitl Street NW, Suite 249 Washingtn, DC Phne: (202) Fax: (202) jlee@aasht.rg Web: rg 36