The Senate this week passed legislation to reauthorize Federal Aviation Administration (FAA) programs and funding for two years. Included in the legislation is $8.1 billion for the Airport improvement Program (AIP), the primary source of federal funding for airport capital projects, $4 billion in FY 2010 and $4.1 billion in 2011. The program is currently funded at $3.5 billion. The bill would also allow six airports (to be determined in the future) to raise the passenger facility charge (PFC) on airline flights from its current permissible level of $4.50 to $7.00. The House passed a four year authorization in July 2009.  The House bill includes a total of $16.2 billion for AIP grant funding and also allows all airports to increase the PFC from $4.50 to $7.00, which is estimated to generate $1billion per year in additional revenue for airport infrastructure investment. AGC is working in support of allowing the PFC ceiling to increase for all airports to $7.00. The Senate bill will now be sent to the House where it can be accepted as is, amended and sent back to the Senate, or, the most likely outcome, a conference committee would be established to work out the differences in the two bills. 

The most recent multi-year authorization of the FAA expired on September 30, 2007. The programs have been operating under a series of short-term extensions, now totaling eleven, since that time.  The current short term extension expires on March 31 and Congress will be in recess for the Easter/Passover break starting next week. Last week, the House passed a bill (H.R. 4853) to extend FAA authorization until July 31, 2010. H.R. 4853 also makes a change in the recently enacted surface transportation extension included in the "Jobs" bill to change the way that $745 million in highway funding under the Projects of National and Regional Significance and Corridor programs will be apportioned to states. This provision enacts an agreement between House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-Minn.) and Senate Majority Leader Harry Reid (D-Nev.) that allowed the "Jobs" bill to move forward in the House.

National Work Zone Awareness week is scheduled for April 19 - 23, 2010, and the theme is  "Work Zones Need Your Undivided Attention." As in the past, the purpose of the week is to bring to the attention of motorists, contractors, construction workers and the media the special dangers that are present in highway work zones. AGC of America's Highway and Transportation Division Chairman Dean Word will participate in a media event in New York City on April 19 to help focus national media attention on the issues surrounding work zone safety. AGC Chapters will also participate in state and local events to help raise awareness.

The 2010 AGC Federal Contractors Conference will be held April 26-29, 2010, at The Mayflower Hotel in Washington, D.C. This meeting is the only national event where contractors and federal agency personnel can meet in a collaborative forum to review federal construction contracting issues and trends from around the country. This year, AGC's Federal Contractors Conference will include a track with Department of Transportation agencies, including Federal Highway Administration, Federal Aviation Administration, Federal Transit Administration and Federal Railroad Administration. This is an opportunity to hear from and discuss with the top leaders in these Federal agencies about issues that impact construction in your market. To learn more about the conference, download the conference brochure and register, visit www.agc.org/fedcon.

While Congress has passed legislation to keep the highway and transit programs operating through the end of the year and provided funds to keep the Highway Trust Fund solvent through the first quarter of 2011, much work still needs to be done. Senators and representatives need to understand the importance to your state's transportation program, jobs and long term investment of enacting long-term well-funded highway and transit reauthorization legislation. The Transportation Construction Coalition has scheduled a Washington Fly-in for May 25-26, 2010 at the Capitol Hill Hyatt Regency to deliver the message: "Transportation Creates Jobs While Building the Future." The Fly-in starts on May 25 with an AGC caucus at 11:00 am followed by a legislative briefing at 2:30 pm. CNN political commentator William Schneider will join key Congressional leaders in discussing the politics of getting the highway and transit bill passed. Schneider will also discuss the broad political landscape and upcoming elections. More information, including registration and hotel reservations, is available here.  http://www.agc.org/galleries/events/AGC_DCFly10HI_2.pdf

On March 18, 2010 the Senate gave final approval to the “Jobs” legislation and President Obama has signed it. The bill, known as the "HIRE Act", includes the following provisions of importance to the highway construction industry:

• 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 by restoring $19.5 billion in interest payments foregone on the HTF’s previous cash balances.
• Restores $12 billion in highway spending authority that was cut on September 30, 2009 due to an $8.7 billion budget rescission in SAFETEA-LU and a subsequent rescission of $3.2 billion. 
• Authorizes payment of interest on future HTF balances.
• Alters the way in which long-standing fuel tax exemptions provided to state and local governments are accounted for which are projected to increase HTF balances by about $1.7 billion annually, for a total of $9.8 billion over six years.
• Provides $4.6 billion in additional authority for Build America Bonds which have been used extensively by state and local governments to fund infrastructure projects, including highway and bridge projects.
• Extends 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.

The House today approved the Senate passed "jobs" bill by a vote 217 to 201, with 211 Democrats and 6 Republicans voting in support.  Before adoption, the bill was amended to address the budgetary concerns of the fiscally conservative "Blue Dog" Democrats who wanted to assure that the bill was deficit neutral. Also included in the amendment is language extending, but not altering, authority for the Department of Transportation's Disadvantaged Business Enterprise (DBE) program. The bill now goes back to the Senate for its consideration. There is no indication as to when the Senate will address the amended bill.

The bill provides an extension of highway program authorization until December 31, 2010, provides additional revenue to the HTF to keep it solvent through the first quarter of 2011, and remedies an $8.7 billion rescission of highway spending authority included in the SAFETEA-LU law. Other construction friendly provisions in the bill include an extension of Build America Bonds and accelerated equipment expensing. 

The program is operating under authorization provided in a 30 day extension that was passed by the Senate on Tuesday and signed by the President yesterday.

This week, Tom Foss, President of Griffith Company, Brea, California presented AGC testimony before the Senate Environment and Public Works (EPW) Committee on the importance of transportation investments to the National economy and jobs. Foss emphasized that the construction industry, like other businesses relay on a well functioning transportation system for delivery of materials and products to job sites and, therefore, called for increased investment to improve system functionality. Foss pointed out that unemployment in the construction industry is currently running at over 24 percent and that additional highway and transportation investment is needed to remedy this situation. AGC's testimony pointed out that transportation funding in the stimulus legislation has saved construction jobs but that more funding was needed. Foss also called for enactment of a long term SAFETEA-LU reauthorization with increased funding to bring long term economic growth and certainty to the highway construction market. EPW Committee Chair Barbara Boxer (D-Cal) said she is committed to getting a six year highway bill completed this year. She called the hearing the first step in accomplishing this goal.

By a vote of 78-19 the Senate last night approved legislation to extend several Federal programs until March 31, 2010, including Highway Trust Fund spending authority that expired on February 28, 2010. The House previously approved the bill and President Obama has signed it. The bill has been on hold due to objections from Senator Jim Bunning (R-Ky.) over budgetary considerations not related to the highway program. The stalemate caused the furlough of Federal Highway Administration (FHWA) employees and prevented reimbursements to state DOTs for ongoing Federal-aid highway contracts. Some states postponed bid lettings because of the uncertainty over the funding and several direct FHWA projects were shut down. Furloughed workers have been told to report back to work today.

Still pending is H.R. 2847, the so-called jobs legislation, which would provide an extension of highway program authorization until December 31, 2010, provide additional revenue to the HTF to keep it solvent through the first quarter of 2011, and remedy an $8.7 billion rescission of highway spending authority included in the SAFETEA-LU law. Other construction friendly provisions in the bill include an extension of Build America Bonds and accelerated equipment expensing. 

The "jobs" bill was passed by the Senate last week but concerns by different factions in the House kept the bill from being approved, making the 30 day extension necessary. One issue raised by House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-Minn.), related to the distribution of highway funds for the Projects of National Significance Program and Corridors Program, has been resolved. The House may consider the "jobs" bill as early as today.

Congress adjourned for the week without enacting legislation to extend highway and transit program spending authority beyond the February 28, 2010 deadline. As a result, states will not be reimbursed for payments for ongoing contracts starting on Monday and FHWA employees will be furloughed on Tuesday. Since the House will not be back in session until Tuesday and the Senate is not scheduled for a vote until Tuesday afternoon, this stalemate cannot be resolved until late next week at the earliest.

Two pending bills were intended to keep this shutdown from occurring but efforts to pass either bill have been stymied. The "Jobs" bill passed by the Senate this week would have extended highway program authorization through the end of the year and provided additional Highway Trust Fund revenue to keep the program solvent. When that bill was sent to the House, it encountered opposition from the fiscally conservative Blue Dog Democrats who raised concerns that the non-highway provisions in the bill violate the House statutory PAYGO budget rules requiring an offset for increased spending. In addition, House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-Minn) asked members to oppose the extension because he objected to the formulas used in the Senate bill to distribute the highway funding. The Senate bill guaranteed that each state receive the same amount of money under the extension as it received in FY 2009. In addition, there was resentment from House members that most of the provisions from the House-passed jobs bill were not included. Since it did not appear likely that the House could pass an extension before February 28, a thirty-day extension was included in a separate bill providing extensions for several other programs also set to expire at midnight on Sunday, which the House adopted. When that bill was brought up in the Senate, Senator Jim Bunning (R-KY) objected to these extensions on budgetary grounds. In order to get past Sen. Bunning's objections, a cloture motion, requiring 60 votes in support, is necessary. This procedure has time requirements that will keep the bill from moving forward for several days. The House could still overcome objections to the "Jobs" bill and pass that.

AGC is contacting key Senators and representatives pointing out the devastating impact this shut-down will have on the highway construction industry and urging them to resolve these differences quickly. You are urged to call your Senators and representative with the same request. To be connected to your elected officials, call the US Capitol switchboard at: 202-224-3121.

A letter to your members of Congress will be posted to http://www.bipac.net/issue_alert.asp?g=AGC&issue=HTF&parent=AGC.