Infrastructure Alert - October 1, 2013

by Cozen O'Connor
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As Congress has now failed to pass a continuing resolution to fund most federal operations, a government shutdown began yesterday morning, the beginning of the federal government’s 2014 fiscal year. While exceptions are made for “essential” employees that are critical to life and safety, many government functions will be suspended until Congress passes and the President signs a bill to appropriate funds for the operation of the federal government.

ON THE HILL

The House Committee on Transportation and Infrastructure has unanimously advanced the Water Resources Reform and Development Act of 2013 (WRRDA), H.R. 3080. WRRDA sponsor and Transportation and Infrastructure Chairman Bill Shuster (R-Pa.) has voiced concern over how the CBO will score the bill. The bill was expected to receive floor time early this month, but its timetable is likely to be adversely affected by the government shutdown.

WRRDA relies on $12 billion of deauthorizations to fund $12 billion in new projects, but as many of thedeauthorizations are essentially defunct and are generally not expected to be funded, CBO could assess that substantially less than $12 billion is actually being deauthorized, which would lead CBO to classify the bill as increasing the deficit.

Several amendments were withdrawn during the markup. Rep. Janice Hahn (D-Calif.) withdrew two of her amendments that would have increased funding for the Harbor Maintenance Trust Fund but would have required billions in unspecified offsets. Rep. Corrine Brown (D-Fla.) withdrew her amendment to fast-track projects that have been approved by the U.S. Army Corps of Engineers for authorization. Rep. Grace Napolitano (D-Calif.) withdrew a similar amendment to the aforementioned one that Rep. Hahn had proposed and withdrawn. Rep. Peter DeFazio (D-Ore.) withdrew an amendment that would have directed $30 million to combat invasive species of animals in waterways managed by the Corps of Engineers. Rep. Lois Frankel (D-Fla.) withdrew an amendment that would have permitted the Corps of Engineers to use non-domestic sand for beach replenishment.

Continuing her effort to ensure the Morganza project is authorized, Sen. Mary Landrieu (D-La.) has started a petition for the inclusion of Morganza in WRRDA. She has stated that she “will not allow the House water infrastructure bill to see the light of day unless Morganza is added back.”

On September 30, the House and Senate each passed bills to authorize relief spending to Colorado infrastructure damaged in the recent flooding. Each bill is deficit neutral. The House bill, H.R. 3174, was introduced by Rep. Cory Gardner (R-Colo.) and co-sponsored by the rest of the Colorado delegation. The Congressional Budget Office score of the bill can be viewed here. The bill passed by voice vote after 40 minutes of debate and a motion to suspend the rules. Sen. Mark Udall (D-Colo.) sponsored S. 1560, the “Deficit Neutral Disaster Relief Act,” with co-sponsor Sen. Michael Bennet (D-Colo.). The bill was passed without amendment by unanimous consent.

On September 26, the House passed H.R. 3095 by a vote 405-0. If enacted, the bill would require the Federal Motor Carrier Safety Administration to only be able to regulate sleep apnea of commercial drivers through the formal rulemaking process instead of merely issuing a guidance. Sen. Roy Blunt (R-Miss.), Ranking Member of the Commerce Subcommittee Surface Transportation and Merchant Marine Infrastructure, Safety, and Security, has introduced a companion bill, S. 1537, which Chairman Mark Warner (D-Va.) and nine others are co-sponsoring. The American Trucking Association has lauded the quick, unanimous passage in the House and introduction of companion legislation in the Senate.

Sen. John Thune (R-S.D.), Ranking Member of the Senate Commerce Committee, wrote representatives of the U.S. Mission to ICAO, Federal Aviation Administration, and Department of State, to urge them to continue to oppose the European Union Emissions Trading Scheme. His bill, the European Union Emissions Trading Scheme Prohibition Act of 2011, was enacted last year to exempt U.S. air carriers from having to participate in the emissions trading scheme.

The Senate Commerce Committee approved the nominations of Deborah Hersman and Christopher Hart to continuing serving on the National Transportation Safety Board. Their nominations await a full vote.

AT THE AGENCIES

With the inception of the government shutdown, hundreds of thousands of federal employees are being furloughed. In the Department of Transportation, 18,481 of the 55,468 employees will be furloughed. Of those employees who will continue working, 8,417 will do so because their salaries are not funded by the lapsed appropriations, and 25,458 are exempt due to being vital for the purposes of life and/or safety. The Department of Transportation’s “Operations During a Lapse in Annual Appropriations” plan can be viewed here.

Due to the life and/or safety exemption, air traffic controllers will not be furloughed. All agencies funded by the Highway Trust Fund will continue normal operations, including the Federal Motor Carrier Safety Administration and the Federal Highway Administration.

Most of the employees at the National Highway Traffic Safety Administration, Federal Transit Administration, Federal Railroad Administration, Surface Transportation Board, Maritime Administration, Inspector General’s office and Office of the Secretary will be furloughed, with exceptions mainly deriving from those who are vital to safety, funded by other fees, or are providing Sandy-related relief.

The Department of Homeland Security’s “Procedures Relating to a Federal Funding Hiatus” is available here. Over 90 percent of the roughly 59,000 Transportation Security Administration employees will continue regular work through the safety exception.

The government shutdown is not expected to delay the beginning of the Department of Justice’s antitrust lawsuit against the pending American Airlines-US Airway merger, despite only 227 of the 619 Antitrust Division employees being exempt from furloughing. The Department of Justice’s FY 2014 Contingency Plan can be viewed here. This morning, however, the Department of Justice did request a stay of proceedings, citing the difficulties that will be caused by the shutdown. The airlines’ lawyers are objecting to the stay request.

Deb Miller, former Kansas Transportation Secretary, has been nominated to the Surface Transportation Board. Kathryn Thomson, the Department of Transportation’s acting counsel, has been nominated to General Counsel of the Department of Transportation.

The Department of Transportation’s Research and Innovative Technology Administration has awarded its 2013 University Transportation Center Grants. The grants, totaling $63 million, were awarded to 33 University Transportation Centers out of the more than 100 universities that applied.

The Government Accountability Office released a report titled “Transit Agencies' Use of Contracting to Provide Service.”

IN THE STATES

October 1, is the initial deadline for 19 states to finalize agreements with Amtrak for funding of short-distance routes. Amtrak has faced significant difficulty negotiating the cost-sharing with Indiana in particular, but agreements with Connecticut, Illinois, Massachusetts, New Hampshire, New York and Rhode Island are still pending as well. Every state except for Indiana has agreed to the draft cost-sharing agreement that has Amtrak pay for certain backbone costs, totaling about 13 percent of the costs of the routes, such as centralized dispatching. Several popular lines are in jeopardy of losing funding without an agreement. Four of the most popular routes are in jeopardy of losing funding, including the Empire Service rail line in New York, one of only five routes outside the Northeast Corridor that served more than 1,000,000 riders in 2012. The 12 states that have reached agreements with Amtrak are California, Maine, Michigan, Missouri, North Carolina, Oklahoma, Oregon, Pennsylvania, Texas, Virginia, Washington and Wisconsin.

Maryland Gov. Martin O’Malley, New Jersey Gov. Chris Christie and Virginia Gov. Bob McDonnell have signed a joint letter endorsing an agreement of the University of Maryland System, Rutgers University and Virginia Tech to operate one of the six sites the FAA will use to test unmanned aerial vehicles.

California: California is rapidly increasing the amount of oil shipments it receives from freight rail due to the shale boom in other states such as North Dakota. The California Energy Commission has compiled data that indicates more than 200,000 barrels of crude oil per month were imported into California this summer, more than four times the amount from 2012. Texas-based Tesoro and Valero Energy have stated their intents to start or increase transporting crude by rail at their California refineries. Some crude oil from North Dakota is being shipped by barge down the west coast to California after being transported by rail to Seattle. More rail is expected to be constructed in the Central Valley to complement California’s existing pipeline network and bolster the movement of shale oil from Colorado, North Dakota and elsewhere. Despite ranking as the third-largest oil-producing state in the United States, California’s output is half that of 20 years ago, and would face adamant environmentalist opposition if it were to explore hydraulic fracturing.

New York: On September 23, construction began on a 800-foot concrete casing to preserve a right-of-way for new rail tunnels under the Hudson River designed to withstand future flooding. The project is being funded with $185 million from the Department of Transportation’s Super Storm Sandy Relief funding, and is expected to be completed in October 2015.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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