By a vote of 62-30 the Senate today voted for cloture, a procedural move that allows debate on the "Jobs" legislation to proceed. The vote was largely along party lines with the following Republican Senators joining 58 Democrats in support: Bond (Mo), Brown (Mass), Collins (Me), Snowe (Me), Voinovich (OH). Senator Nelson (Neb) was the lone Democrat voting against. While there are still 30 hours of potential debate on the underlying bill, today's vote was the key, and final passage in the Senate will likely occur on Tuesday. AGC sent numerous alerts in support of the legislation and members across the country responded by urging their Senators to support cloture. AGC followed up visits and correspondence with Senators by sending a Key Vote alert today pointing out the high importance the construction industry placed on today's vote.

 The bill contains the following provisions:

• Extends highway program authorization through December 31, 2010 at current funding levels.
• Provides additional revenue to keep the Highway Trust Fund solvent through the first quarter of 2011.
• Restores highway spending authority that was cut on September 30, 2009 due to a budget recession in SAFETEA-LU.
• Allow public bodies to convert tax credit bonds to Build America Bonds.
• Exempts workers hired in 2010 that have been unemployed for at least 60 days from Social Security payroll taxes.
• Extends 2008 and 2009 section 179 expensing thresholds so that taxpayers may elect to write-off up to $250,000 of certain capital expenditures in 2010 in lieu of depreciating those costs over time.

 Following passage by the Senate the bill must go to the House for consideration.

Hours after Senate Finance Committee Chairman Max Baucus (D-Mont.) and Ranking Member Chuck Grassley (R-Iowa) released a draft "Jobs" bill to address current economic conditions which had bipartisan support, Senate Majority Leader Harry Reid (D-Nev.) offered instead a scaled-down version and announced that the Senate will consider this version of the legislation on February 22, following the week-long President's Day recess.  The Reid "jobs" legislation contains the same provisions related to the highway program as in the Baucus/Grassley bill as follows:

 - Extends authorization for the highway and transit programs at FY 2009 funding levels though December 31, 2010;

- Provides $19.5 billion in revenue to the Highway Trust Fund to keep the program solvent into 2011. This transfer would reimburse the HTF for $19.5 billion in lost interest payments since 1998;

- Shifts the cost of motor fuel tax exemptions for state and local governments from the HTF to the general fund.  This would provide ongoing HTF revenue of approximately $1.5 billion each year;

- Restores spending authority lost from an $8.7 billion rescission of contract authority contained SAFETEA-LU.

The current extension of highway and transit program authorization expires on February 28, and because of federal budget rules it is important that the extension and transfer of funds happen before that deadline. Every state will lose funding if this fix is not approved. Click here to view the impact on your state. This new twist will make meeting this deadline even more difficult. If you have not yet done so, please contact your senators, particularly Republican senators, and tell them to support an extension of the highway and transit program with additional revenue through the end of the year. Inform them that failure to pass the extension and the additional program revenue will have a direct impact on FHWA's ability to reimburse your state DOT for ongoing construction projects and could cause your DOT to cancel scheduled lettings.  You can send a message by calling the Capitol Hill switch board at 1-800-828-0498 and ask for your Senators' offices, or by following this link to AGC's Legislative Action Center.

The California Air Resources Board (CARB) announced that it has postponed the implementation of its off-road equipment rule which was scheduled to go into effect on March 1, 2010 because it has not yet received approval from the US Environmental Protection Agency (EPA) to move ahead with enforcement. In making the announcement, however, CARB agreed with AGC's request to hold a public hearing on the question of whether the off-road regulations should be further modified to account for the down economy and subsequent emissions reductions. AGC has presented CARB with substantial empirical data demonstrating that the downturn in California's economic conditions and the resulting drop in construction activity have made the rule unnecessary. AGC has pointed out that California's own inventory data makes clear that off-road equipment operators will be well under the state's aggressive diesel emissions limits for years to come without this rule. 

Mike Kennedy, AGC's general counsel, said the following about CARB's action: "AGC appreciates the opportunity to publicly air our concerns and expect Board officials will ultimately agree to significant changes to their off-road diesel rule.  However, yesterday's decision to 'delay' enforcement of the rule until a federal waiver is issued is as legally meaningless as it is economically damaging.  By committing to begin enforcement as soon as the federal government allows, the Board is only acknowledging legal reality, not providing relief." 

 Unless blocked, the CARB rule will require California's contractors to retrofit, repower, retire and/or replace much of their off-road equipment. The Federal Clean Air Act prohibits other states from implementing their own off road diesel emissions rule but allows them to adopt the California rule.  A study conducted by AGC shows that 32 states, including Arizona, Georgia, Illinois, Maryland, New York, Pennsylvania and Texas, are poised to use the California requirements. Because of the impact on contractor's nationwide, AGC joined with the AGC of California and San Diego AGC Chapter in a collective effort to stop the rule or significantly modify it.

President Obama released his Administration's Fiscal year 2011 budget proposal today. For the Federal-aid highway program the budget requests $41.363 billion just slightly more (.6 percent) than the current $41.07billion level. The Administration notes that the highway program expired on September 30, 2009 and repeats its request that authorization be extended through March 2011 to allow time for Congress and the Administration to work on new legislation stating that "surface transportation programs and the system for paying for them must be fundamentally reformed." The budget documents also point out that Highway Trust Fund revenue is insufficient to fund the program at this level and assumes that $20 billion will be transferred from the general fund to cover the revenue short fall.

Continuing the Administration's year long emphasis for "livability and sustainability", the budget calls for an allocation of $527 for its multi-agency Partnership for Sustainable Communities, including a request to transfer $200 million in highway program funding for this initiative. The budget requests the creation of an Office of Livable Communities within the Department of Transportation to coordinate efforts between Dot and the Environmental Protection Agency and Department of Housing and Urban Development.  

The budget requests $600 million in discretionary funds for grants to state and local governments and transit agencies for projects of National, metropolitan or regional significance.

The budget also requests $4 billion to create within the DOT a new National Infrastructure Innovation and Finance Fund. It is proposed that the office will provide grants and credit assistance for a variety of surface transportation projects, including: highway, tunnel, bridge transit, commuter rail, passenger and freight intermodal facilities, passenger rail, Amtrak, airports and ports. The projects are to be of National or regional significance and be valued at $25 million or more. Projects of less than $25 million can be approved in areas with smaller populations. An additional criterion for funds under this proposed program is that the projects increase the environmental sustainability of the transportation network in the region.  

Included in the budget is a request for an additional $1 billion in funding for high speed rail. This is to supplement the $8 billion in funds provided (with grant awards announced this week) in the American Recovery and Reinvestment Act (ARRA).

For the Federal Transit Administration, the budget requests $10.8 billion in grant funding, also a .06 percent increase over FY 2009. The budget makes several proposals for altering the transit program's structure.

Funding for the Federal Aviation Administration's Airport Improvement Program is proposed to be continued at the FY 2009 level of $3.515 billion.