Congress Finance Infrastructure

A Few Answers on the Public Works Bill

The House and Senate, and we’ve discussed in a recent post, has been considering a major infrastructure bill that would provide a massive new source of funds for improvements to the nation’s roads and railways. I asked a few questions to Jim Berard, Director of Communications for the House Transportation and Infrastructure Committee, which is headed up by Congressman Jim Oberstar. He also sent me a handy PDF of the letter sent yesterday by Oberstar and Representatives John Mica and Peter DeFazio to Henry Paulson and Ben Bernanke in reference to the recent AIG transit funding disaster. You’ll note that the final two pages of the document show all of the deals made by the nation’s transit agencies with AIG, summed up to a flabbergasting $16 billion; let’s just say that most of this nation’s public transit rail fleet appears to be owned by AIG and being leased back to transit authorities. I won’t blabber on again about why that’s such a bad idea…

Here’s the Q&A:

1. Have the specifics of the infrastructure/public works bill been laid out yet? How much of the proposal will be dedicated to transportation improvements? Of that, what percentage is dedicated to transit vs. roads?

“The final bill will be drawn up by Speaker Pelosi, based on recommendations of the various committees of jurisdiction.  We do not know the final dollar amount of the bill or how much of that total will be dedicated to infrastructure.  We can, however, use the stimulus bill passed by the House in late September, H.R. 7110, as a guide.  That bill provided $30 in infrastructure investment, of which $12.8 billion for highways and bridges and $4.6 billion for transit.”

2. Will the bill’s transportation component provide funding to states or directly to transportation agencies? Will the DOT be asked to evaluate and choose which projects to fund, or will Congress make those decisions in the bill itself?

“The funding for transportation infrastructure will be distributed to the states according to the same formula by which they currently receive revenue out of the Highway Trust Fund.  For transit, larger transit agencies will receive funding directly, smaller systems will get their funds through the state.

3. Will the transportation investments go towards new projects, or also be aimed for the renewal and renovation of current highways and transit systems?

It will be up to the states to determine which projects are funded.  If the new bill follows the same process set out in H.R. 7110, the states will be required to give priority to projects that can be started within 120 days.  These can be new construction or rehabilitation of current infrastructure.

4. Will there be aid to transit agencies designed to counteract the declining resources of state budgets and the problems due to those agencies’ involvement with AIG?

“We are very concerned about the effect AIG’s collapse is having on transit systems.  Our committee has sent a letter to the Treasury Secretary and the Federal Reserve Chairman asking them to step in and prevent action against transit agencies in this case.  (See attachment.) We will certainly monitor this situation closely and work with the Speaker to add legislative language to help these systems if such an approach is needed.”

One reply on “A Few Answers on the Public Works Bill”

It seems to me that this news (to me, at any rate) that our “public” transportation is dependent on the private market is part of the American assumption that private enterprise always works better than government- even for essential services such as transportation, health care, etc. Given the fact that we are already suffering from aging infrastructure, have resisted developing our cities and towns in a transportation friendly manner, and are behind in financing and building transportation systems designed to take advantage of the latest technology- will the AIG problems only put us further behind where we need to be as a country or will it encourage new approaches?

Leave a Reply