Energy & Transportation Update
An Information Service of the AFI Energy and Transportation Committee
February 1, 2002
Volume III, Number 3
A near-30 percent reduction in federal highway funding for FY2003 will become official on Monday, February 4, when the president submits his FY2003 budget to Congress. The downturn in federal transportation funding could force state project delays, compel further prioritization and/or raise concerns for paying off state bond obligations.
RABA Projections
Provisions in TEA-21 adjust federal highway funding to reflect anticipated and actual revenues flowing into the Highway Trust Fund. While the "revenue adjusted budget authority" (RABA) calculation has added substantial funds in the past (FY2000-FY2002), FY2003 has resulted in a $5 billion loss. Seventy percent, or $3.468 billion of the negative RABA is a result of fewer FY2001 tax receipts coming into the trust fund than were estimated for 2001. The remaining 30 percent shortfall results from the revenue estimate for FY2003 coming under that estimated in TEA-21. A 25 percent increase in the use of gasohol purchases (taxed lower than gasoline) and a reduction in the consumption of more heavily taxed diesel fuel has contributed to a downward RABA adjustment of $5 billion for FY2003. As a result, the core federal highway program would receive about $22.7 billion for FY2003 - a $9.1 billion drop compared to overall federal-aid highway funding levels for FY2002.
Congressional Action
Several key members of Congress have commenced discussions, in which NCSL staff has participated on alternatives to "fix" this problem - either partially or in its entirety.
Senator Jim Jeffords (I-Vt.), chairman of the Senate Environment and Public Works Committee, plans to attach as an amendment to the economic stimulus package legislation proposing a $5 billion RABA restoration. Senate Finance Committee Chairman Max Baucus (D-Mont.) may pursue a similar course. Members of the House Transportation and Infrastructure Committee plan to take action on the transportation funding loss, but are still at odds on whether to propose a $5 billion increase or restore the highway funding levels to FY2002 levels - a $9 billion increase.
ACTION IS NEEDED
To impress upon members of Congress and the administration the affect these reductions would have on state programs and initiatives, WE NEED TO DISPLAY WHAT ARE SOME OF THE LIKELY PROBLEMS STATES WILL FACE IF THIS REDUCTION IS NOT REMEDIED. It is certain that some projects might be delayed or cancelled, some loans or payments made through innovative state financing alternatives might be jeopardized, some jobs might be lost and meeting bond obligations secured with future anticipated federal revenues might be problematic. Other potential problems may well loom. TO MAKE ANY REQUEST FOR A LEGISLATIVE REMEDY MORE CONVINCING, SPECIFIC EXAMPLES OF THE IMPACT OF FUTURE TRANSPORTATION FUNDING CUTS ON YOUR STATES WOULD BE VERY VALUABLE. Therefore, please have your staff e-mail or fax examples to NCSL and to your congressional delegation as soon as possible.
Please contact your congressional delegation members, House Transportation and Infrastructure Committee members, Senate Environment and Public Works Committee members or leadership (see attached list) and voice your support for restoring the full federal transportation funding for FY2003.
|
Michael Bird
Senior Federal Affairs Counsel
Phone: (202) 624-8686
Fax: (202) 737-1069
Michael.Bird@ncsl.org |
Laurie Holmes
Energy and Transportation Cmte. Staff Assistant
Phone: (202) 624-8695
Fax: (202) 767-1069
Laurie.Holmes@ncsl.org |
Energy & Transportation Update Main Menu
NCSL Staff:
Eileen Doherty
Committee Director
AFI Energy and Transportation Committee
(202)624-8687
Laurie Holmes
Committee Assistant
AFI Energy and Transportation Committee
(202)624-8695 |
