Obama Budget Reveals Surface Transportation Program Reauthorization Plan

The Obama Administration yesterday placed its markers on the table for a multi-year reauthorization of the federal surface transportation programs. As part of its FY 2012 budget submission, the Administration outlined a six-year, $556 billion surface transportation program - one that would radically change the program's scope and structure. Unfortunately, the budget did not address the key question - how the proposed six-year program would be funded.

Nonetheless, on a positive note, the Obama plan does provide the grist necessary to begin a legislative debate with the Congress on the future direction of federal investments in transportation. The Obama surface transportation program reauthorization plan would include:

New Trust Fund - Create a new "Transportation Trust Fund," replacing the Highway Trust Fund, and establish four accounts - one for highways, one for transit, one for high-speed rail, and one for the National Infrastructure Bank.

Off-Budget - The transportation programs would be moved "off-budget" and become "mandatory spending" with spending strictly aligned with revenues into the trust fund.

Passenger Rail - For the first time, passenger rail would be a major component of the surface transportation bill, directly receiving $53 billion, or just under 10 percent, of the total six-year authorization. This funding would include "High Speed Rail" initiatives, but the budget made clear that the Administration's plan to connect "80 percent of Americans with access to High Speed Rail," means largely "higher than current speed" Amtrak, not "bullet train," service.

Redirected Highway Program - The existing more than four dozen federal highway program categories would be shrunk to five, with six-year funding of $332.8 billion, 60.2 percent of the six-year authorization total. Of this, $257 billion dollars would be directed to investments in an enlarged, 220,000-mile "National Highway System." The NHS investment would be split nearly in half - one for a "fix-it-first" program to rehab existing NHS road surfaces and bridges; the other for a "flexible" program allowing states to direct funds to projects on any eligible federal-aid road. The remaining 20-some percent funding in the Highway Program would be directed to safety ($17 billion), a "livable communities" program ($28 billion), federal lands, tribal roads, emergency relief and workforce development ($10 billion) and research ($4 billion). An additional $17 billion would be available for a new "Transportation Leaderships Award" program of U.S. DOT directed earmarks.

Transit Investments - Almost 22 percent of the six-year program's total funding, $119 billion, would go to the transit program. The formula program would receive $46 billion for transit expansion and the New Starts program would receive $20.6 billion. A new "Bus & Rail State of Good Repair Program" would be created and funded with $35.5 billion to repair and purchase buses, rail cars and rail transit stations. Transit research, operations and safety programs would receive just over $2 billion. A new "Transit Leadership Award" program would provide an additional $14.7 billion for USDOT earmarks over six-years.

National "I-Bank" - The authorization would create a "National Infrastructure Bank" operating under the umbrella of the U.S. DOT for major infrastructure projects of all types. It would receive $5 billion annually in federal funds to leverage over the six-year authorization.

FY 2012 "Jump Start" - Under the proposal, transportation programs would receive a one-time, $50 billion jump start, elevating FY 2012 investments to $128 billion for highway, transit, rail and airport activities. This would be $53 billion more than was authorized for FY 2010.

Further details on the Administration's proposal for reauthorization and a detailed analysis of its FY 2012 transportation budget can be accessed at the "current issues" page.

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