Senate Subcommittee approves record highway funding

News AGC July 19, 2006
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The Senate Transportation Appropriations Subcommittee recently sent to the full Appropriations Committee the FY 2007 transportation funding measure that provides $39.1 billion for the highway program, which is a 9.7% increase over FY 2006 funding. This is the level requested by President Bush in his budget submission in February and already included in the House-passed version of the bill.

The funding includes both the $38.244 billion obligation limit authorized in the SAFETEA-LU law and an additional $842 million in revenue aligned budget authority (RABA) spending. RABA is the mechanism established in TEA-21, and reauthorized in SAFETEA-LU, that requires a look back and adjustment to ensure that each year's funding matches actual Highway Trust Fund revenue. SAFETEA-LU changed the way in which RABA is distributed by requiring the additional funding first be used to help donor states reach a 92% rate of return. Therefore, the additional funds are expected to go to the following donor states: Ariz., Calif., Colo., Fla., Ga., Ill., Ind., Iowa, Md., Mich., N.J., N.C., Ohio, Okla., S.C., Tenn., Texas, Va. and Wash. Remaining RABA funds have been earmarked for specific projects in both the House and Senate bills.

The subcommittee's bill provides an obligation limitation for the Federal Aviation Administration's Airport Improvement Program (AIP) of $3.52 billion. This is $770 million above the President's budget request that proposed cutting AIP funding to $2.75 billion but $180 million below the authorized level. AGC worked to have AIP funding at the fully authorized level of $3.7 billion, which is the amount included in the House bill. FY 2006 funding for AIP was $3.515 billion.

The Federal Transit Administration would receive $8.875 billion in FY 2007, $370 million more than in FY 2006 (4.4%). The primary account (formula and bus grants) would receive $7.263 billion, the amount authorized in SAFETEA-LU. The new starts program would be funded at $1.466 billion, the amount requested in the Bush budget, which is $100 million less than authorized in SAFETEA-LU.

The bill provides $1.4 billion for Amtrak, $500 million above the President's request and $286 million above the House approved level. Last year Amtrak was funded at $1.294 billion. The administration budget proposed splitting the Amtrak money into two accounts--$500 million for capital spending and $400 million for operating grants. The Senate bill provides $750 million for capital spending.

The full Appropriations Committee is expected to take up the measure later this week.

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