Infrastructure Alert – January 30, 2014

In Tuesday’s State of the Union address, President Obama urged Congress to pass a reauthorization for the Water Resources Development Act. President Obama also called for corporate tax reform as a method to finance infrastructure spending. He stated that his administration will “slash bureaucracy and streamline the permitting process for key projects” and said that he supports higher fuel efficiency standards for trucks.


Although the Water Resources Development Act conference began more than two months ago, House Transportation and Infrastructure Chairman Bill Shuster (R-Pa.) has recently stated that he is “confident” the bill will move out of conference.

On January 16, Sen. Michael Bennet (D-Colo.) and Sen. Roy Blunt (R-Mo.) introduced S. 1957, the Partnership to Build America Act of 2014. The bill would create a $50 billion infrastructure bank called the “American Infrastructure Fund” to fund transportation, energy, communications, water and education infrastructure projects. The other 10 co-sponsors of the bill are Sen. Mark Warner (D-Va.), Sen. Kelly Ayotte (R-N.H.), Sen. Mary Landrieu (D-La.), Sen. Angus King (I-Maine), Sen. Dan Coats (R-Ind.), Sen. Lindsey Graham (R-S.C.), Sen. John Hoeven (R-N.D.), Sen. Mark Begich (D-Ark.), and Sen. Mark Kirk (R-Ill.). The bill is a Senate companion to an infrastructure bill that Rep. John Delaney (D-Md.) introduced in May 2013 that also has bipartisan support.

On January 15, the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines and Hazardous Materials held a hearing titled “A Review of the Challenges Facing California High-Speed Rail.” Karen Hedlund, Deputy Administrator of the Federal Railroad Administration, Dan Richard, the Chairman of the Board of the California High-Speed Rail Authority, and Alissa Dolan of the Congressional Research Service testified, as well as several Members of Congress from California. Chairman Jeff Denham (R-Calif.) was the most vocal critic of the progress shown by the California High-Speed Rail Committee, but also of the Federal Railroad Administration for continuing to reimburse California for the project even after a court ruling prevented the sale of bonds. Denham was frustrated that the FRA has been unable to provide him and his staff with invoices regarding the project for weeks. Richard assured the subcommittee that federal taxpayers are fully protected and that California will continue to match federal funds. Several members of the subcommittee criticized the reliance on the project for federal funding, and made comparisons to the private-partnerships that are financing high-speed rail in Florida and Texas.

The following day, Rep. Denham introduced H.R. 3893, the Responsible Rail and Deterring Deficiency Act. The bill would prevent federal funds from being used by the California High-Speed Rail Authority until it could verify that the matching state funds are fully funded. The bill has 14 co-sponsors, all of whom are Republicans from California.

The House Transportation and Infrastructure Committee has created a special panel on public-private partnerships. This is the second special panel the committee has created leading up to its work on the surface transportation reauthorization. The “Panel on Public-Private Partnerships” will be chaired by Committee Vice Chairman John Duncan, Jr. (R-Tenn.) and Rep. Michael Capuano (D-Mass.) will serve as its ranking member. The remaining panelists are Reps. Candice S. Miller (R-Mich.), Lou Barletta (R-Pa.), Tom Rice (R-S.C.), Mark Meadows (R-N.C.), Scott Perry (R-PA), Peter A. DeFazio (D-OR), Eleanor Holmes Norton (D-DC), Rick Larsen (D-WA), and Sean Patrick Maloney (D-N.Y.). The first panel, on intermodal freight, released its report to the committee in October. Rep. Duncan also chaired that panel.

On January 14, Rep. Richard Hanna (R-N.Y.) and Rep. Janice Hahn (D-Calif.) introduced H.R. 3872, the State Transportation and Infrastructure Financing Innovation Act (STIFIA). The bill would reauthorize the State Infrastructure Bank program, which permitted states to use up to 10 percent of existing federal transportation funding to create a state infrastructure bank. The program was created in 2005, its authorization expired in 2009, and the program was not included in the Moving Ahead for Progress in the 21st Century Act (MAP-21) in 2012. The bill would amend MAP-21 to reauthorize the program, but allow states to use up to 15 percent of existing federal transportation funding to capitalize a state infrastructure bank. Rep. Albio Sires (D-N.J.) is also a co-sponsor.

The House Transportation and Infrastructure Committee held its first hearing to begin discussing the surface transportation reauthorization with stakeholders on January 14. Witnesses included Mary Fallin, Governor of Oklahoma; on behalf of the National Governors Association; Stuart Levenick, Group President, Caterpillar Inc.; KasimReed, Mayor of Atlanta; on behalf of the U.S. Conference of Mayors; and Lawrence Hanley, International President, Amalgamated Transit Union. The existing surface transportation authorization, Moving Ahead for Progress in the 21stCentury (MAP-21), expires at the end of September. In his opening statement, Chairman Shuster said that he wants the reauthorization bill on the House floor prior to the August recess. Gov. Fallin testified that eliminating the federal tax code exemption for interest on municipal bonds would trigger higher interest rates, increase borrowing costs, and increase the total costs of projects in general. Levenick urged Congress to improve port facilities, stressing the need for a long-term, multimodal plan, adding that American transportation modes are not as aligned as they are in other countries.

During the hearing, Rep. Duncan asked how Congress should supplement the falling revenues from the Highway Trust Fund. Levenick remarked there are several options that are attractive, including increasing TIFIA funding or passing Rep. Delaney’s infrastructure bank bill. He said that Caterpillar is open to many options so long as they provide long-term certainty. Mayor Reed praised TIFIA, but said alternatives are needed as well. Hanley voiced his support for taxing financial transactions to fund infrastructure and criticized public-private partnerships as a “craze” that often hurts American workers. Rep. Grace Napolitano (D-Calif.) stated she wants an infrastructure bank to supplement Highway Trust Fund revenues and pay for surface transportation. Rep. Richard Hanna (R-N.Y.) and Rep. Larry Buchson (R-Ind.) floated the idea of a federal user fee on transit. Rep. Janice Hahn (D-Calif.) stated Congress needs to use Harbor Maintenance Tax Fund money for investing in dredging and the nation’s ports.

President Obama signed the $1.1 trillion omnibus appropriation bill on January 17. The bill passed the Senate by a 72-26 vote on January 16 and the House by a 359-67 vote on January 15.

The appropriations bill contains $17.8 billion in discretionary appropriations and $53.5 billion in non-discretionary funding for the Department of Transportation. Funding includes nearly $41 billion for the Federal Highway program (the same amount authorized by MAP-21), $12.4 million for the Federal Aviation Administration ($168 million below FY2013 enacted funding), $1.6 billion for the Federal Railroad Administration ($34.6 million below FY2013 enacted funding), $2.15 billion for the Federal Transit Administration ($100 million below FY2013 enacted funding), $819 million for the National Highway Traffic Safety Administration ($8.9 million above FY2013 enacted funding), and $585 million for the Federal Motor Carrier Safety Administration ($24 million above FY2013 enacted funding). The omnibus preserves funding for the FAA’s NextGen program and does not include funding for high-speed rail. The omnibus funds the Maritime Security Program at $186 million and the Title XI Federal Ship Financing Program at $38 million. The bill also appropriates $140 million for contract control towers, $600 million for TIGER grants, and a $12.8 million increase from 2013 for the Pipeline and Hazardous Materials Safety Administration.

Rep. Trey Radel (R-Fla.), formerly a member of the House Transportation and Infrastructure Committee, has resigned.

Senate Environment and Public Works Chairman David Vitter (R-La.) has announced he will run for Governor of Louisiana.

On February 4, the House Transportation and Infrastructure Subcommittee on Coast Guard and Maritime Transportation will hold a hearing titled “Finding Your Way: The Future of Federal Aids to Navigation.” When witnesses are announced, their names and testimony will be available here.

On February 5, the House Transportation and Infrastructure Subcommittee on Aviation will hold a hearing titled “The FAA Modernization and Reform Act of 2012: Two Years Later.” When witnesses are announced, their names and testimony will be available here.

On March 4, the House Transportation and Infrastructure Subcommittee on Coast Guard and Maritime Transportation will hold a hearing titled “Maritime Transportation Regulations: Impacts on Safety, Security, Jobs and the Environment, Part II.” When witnesses are announced, their names and testimony will be available here.


Federal Transit Administrator Peter Rogoff is now the Department of Transportation acting undersecretary of policy, following Polly Trottenberg’s appointment to Commissioner of the New York City Department of Transportation.

On Tuesday, Amtrak issued a press release titled “Amtrak: Framework Needed for Surface Transportation Investment Program.” The press release cited recent remarks made by Amtrak President and CEO Joe Boardman that Amtrak should be included in the upcoming surface transportation reauthorization. Boardman also criticizes the Highway Trust Fund as “based on an outmoded vision for mobility in the United States and is financially unviable.”

On January 23, the National Transportation Safety Board released three recommendations regarding rail cars that carry crude oil to the Federal Railroad Administration and the Pipeline and Hazardous Materials Safety Administration. The NTSB recommends: requiring expanded hazardous materials route planning for railroads to avoid populated and other sensitive areas, developing an audit program to ensure rail carriers that carry petroleum products have adequate response capabilities to address worst-case discharges of the entire quantity of product carried on a train, and auditing shippers and rail carriers to ensure they are properly classifying hazardous materials in transportation and that they have adequate safety and security plans in place.

On January 22, the Federal Motor Carrier Safety Administration issued a final rule for “Patterns of Safety Violations by Motor Carrier Management.” The rule will allow the FMCSA to more easily suspend or revoke registration of for-hire motor carriers that have poor safety or compliance records. The rule goes into effect on February 21.

On January 17, the National Transportation Safety Board released its 2014 “Most Wanted List” of advocacy priorities.

On January 16, the Government Accountability Office released a report titled “Federal-Aid Highways: Federal Highway Administration Could Further Mitigate Locally Administered Project Risks.”

On January 15, The Office of Inspector General of the Department of Transportation released a report titled “DOT’s Efforts to Reduce Spending on Management Support Services Contracts Have Been Delayed.”

The FAA Management Advisory Council has 10 new members: Steve Alterman, President of Cargo Airline Association; Bill Ayer, former Chairman of the Alaska Air Group; Montie Brewer, former President and CEO of Air Canada; Ray Conner, President and CEO of Boeing Commercial Airplanes; Craig Fuller, President of the Fuller Co.; Jane Garvey, former FAA Administrator; Michael Hancock, Mayor of Denver; Lee Moak, President of the Air Line Pilots Association; John Potter, President and CEO of the Metropolitan Washington Airports Authority; and Gwynne Shotwell, President and COO, Space X.

The Department of Transportation Bureau of Transportation Statistics has published its “Pocket Guide to Transportation 2014.”


California: Republican Assemblyman Jeff Gorell has proposed a ballot measure to prevent bond sales to fund high-speed rail in the state. The sale of $10 billion in state general obligation bonds was originally approved by a 2008 ballot measure. Since that vote, however, the project’s projected costs have risen and the project has suffered several setbacks in court rulings, including a ruling in November that deemed that the California High-Speed Rail Authority had provided too little information to move forward with the sale of over $8 billion in bonds. In order to qualify for the ballot, the proposed referendum must collect 504,760 signatures.

New York: On January 24, the federal Department of Transportation and the Federal Transit Administration announced $886 million in funding for the New York Metropolitan Transportation Authority for projects to repair Hurricane Sandy damage and protect against future natural disasters. MTA has announced it will use the funding in the following manner: $535 million for critical repairs primarily to the damaged under-river Greenpoint, Montague and Steinway tunnels, $138.9 million to restore damaged substations and power infrastructure for the Long Island Rail Road (LIRR) and Metro-North Railroad, $88.1 million to repair essential communications and signal equipment for Metro-North (system-wide) and LIRR’s Long Beach Branch and Westside storage yard, $91.5 million to restore damaged rights of way and to design services to make long-term repairs to damaged assets, and $32 million to repair stations, employee facilities, and fare collection equipment for both rail and bus facilities.

About The Author

Robert Freeman is located in the Washington D. C. office and brings with him more than 15 years of bicameral Congressional experience to Cozen O’Connor, having held several ranking staff positions with federal legislators. Robert is a registered lobbyist and is actively involved in politics. His practice areas include, but are not limited to, technology, defense, homeland security, procurement, appropriations, competitive sourcing, transportation, energy, trade, and foreign relations.

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