Budget provision, if approved by Senate, will increase federal allocations for rail to $12 billion in this year alone.
Yesterday, the U.S. House passed its housing and transportation bill, which will provide funds for fiscal year 2010. Approved mostly by members of the majority Democratic party, the bill would allocate $4 billion to high-speed rail programs — if the Senate’s version, likely to be considered after the August recess, includes the same provision. If a planned infrastructure bank is authorized by the Congress later this year, $2 billion of the included funds would be shifted there and could be devoted to non-rail projects, though that prospect appears unlikely at this time.
In the President’s Budget, released earlier this year, Mr. Obama asked the Congress to devote $1 billion for the next five years for high-speed rail, in addition to the $8 billion already marked for the program under the stimulus bill. The House’s decision to increase that number to $4 billion is a direct reaction to the huge response from states and the private sphere for stimulus-based federal rail grants. The FRA revealed that forty states had applied for more than $103 billion.
Iowa Congressman Tom Latham (R) attempted to block the inclusion of so much money for rail, arguing that the government shouldn’t embark on what he argued would be a $100 billion endeavor. Yet his amendment was put down by a vote of 136-284, with 40 Republicans voting against his measure — compared to the only 16 members of the GOP voting for the bill as a whole. This indicates strong bipartisan support in Congress for high-speed rail investment and bodes well for similar action in the more conservative Senate.
Two billion of the allocated dollars would be transferred to an infrastructure bank if that agency is established later in the year. The bank would extend low interest loans to valuable projects contributing to the well-being of the nation as a whole, including appropriate private investments. At this point, however, the infrastructure bank has yet to materialize and even if it does, it would likely focus at least initially on rail projects, since they’ve achieved prominence this year in the national discourse.