Infrastructure Alert - February 11, 2014

by Cozen O'Connor

The Panama Canal Authority and the GPUC, the construction consortium working on its expansion, have been deadlocked over whether the Canal will pay for $1.6 billion in cost overruns. Construction halted on February 5 due to the disagreement. The construction consortium’s winning bid was $1 billion lower than its nearest competitor. The project is 70 percent completed and is expected to be completed by 2015.


This morning, the House Transportation and Infrastructure marked up and approved several bills, most notably H.R. 4005, the Howard Coble Coast Guard and Maritime Transportation Act of 2014. Rep. Duncan Hunter (R-Calif.), Chairman of the Subcommittee on Coast Guard and Maritime Transportation, introduced the bill on February 6. Full committee Chairman Bill Shuster (R-Pa.) and Ranking Member Nick Rahall (D-W.Va.) are the two co-sponsors of the bill. H.R. 3676, the Prohibiting In-Flight Voice Communications on Mobile Wireless Devices Act of 2013, and 17 resolutions concerning General Services Administration Capital Investment and Leasing Program were also approved. More information on the markup and bills will be available on the committee website.

H.R. 4005 authorizes the Coast Guard for FY 2015-2016, requires the Coast Guard to submit an annual authorization request to Congress, requires the Coast Guard to take an inventory of its real property and determine which property can be divested or consolidated, requires MARAD to develop a National Maritime Strategy, places prohibitions and exemptions on certain regulations, reauthorizes the Federal Maritime Commission at its current funding level, and imposes term limits on the FMC Commissioner.

For H.R. 4005, two amendments were approved. The first, offered by Rep. Hunter, was a manager’s amendment and was approved by voice vote. The amendment included technical amendments, language to reform and strengthen cargo preference laws, language to respond to extreme debris events, language regarding the Merchant Marine program and maritime academies, amendments to the section of the bill regarding icebreakers, and language to direct the Government Accountability Office to conduct an economic study of the potential effects of requiring all LNG exports to be carried by U.S. flagged and U.S. built tankers, among other provisions. The only other amendment to be approved was an amendment offered by Chairman Shuster to rename the bill after retiring Rep. Howard Coble (R-N.C.). Rep. Coble has served 15 terms in the House, and is the only active Member of Congress to have served in the Coast Guard.

Nearing its third month, the conference to reconcile the water resources reauthorization bills continues. The conference committee first met on November 20, 2013. H.R. 3080, the Water Resources Reform and Development Act of 2013, passed the House by a vote of 417-3 on October 23, 2013. S. 601, the Water Resources Development Act of 2013, passed the Senate by a vote of 83-14 on May 5, 2013.

On February 6, Sen. Mark Begich (D-Ark.) and Sen. Brian Schatz (D-Hawaii) introduced S. 2004, the Safe Streets Act of 2014. The bill is the Senate version of H.R. 2468, the Safe Streets Act of 2013, introduced by Rep. David Joyce (R-Ohio) and Rep. Doris Matsui (D-Calif.) in June. The bill would institute “Complete Streets” policies that would create protocols for how federally funded roadways and bridges are constructed with consideration of pedestrian and bicyclist use. If enacted, the Secretary of Transportation would evaluate how these policies would be evaluated and implemented within one year.

On February 5, the House Transportation and Infrastructure Subcommittee on Aviation held a hearing titled “The FAA Modernization and Reform Act of 2012: Two Years Later.” Department of Transportation Inspector General Calvin Scovel testified that he thinks “two to three times” the $40 billion that has been invested by public and private sources will be needed to complete the NextGen transition. He also estimated that NextGen implementation may not be completed until 10 years after its original 2025 goal. The FAA is also lagging behind the deadlines the law put in place for integrating unmanned aerial vehicles (UAVs) into the national airspace, and Scovel testified that the FAA will not meet the statutory deadline of September 30, 2015 for the integration of UAVs. The FAA has completed only eight of the 17 drone-related provisions of the law, and of those eight, several were past their deadlines. FAA Administrator Michael Huerta testified that UAVs will have a “staged integration.” The FAA Modernization and Reform Act of 2012 expires after September 25, 2015.

At a recent Bloomberg Government sponsored event, House Transportation and Infrastructure Chairman Bill Shuster stated that he would not support raising the gasoline tax in the upcoming surface transportation reauthorization. He also stated that he prefers a five- or six-year bill, as opposed to a two-year reauthorization like the current Moving Ahead in Progress for the 21st Century Act. Chairman Shuster added that there are other ways to raise the revenue necessary to fund the bill, mentioning cutting federal spending and programs several times as well as remarking that user fees such as a vehicle miles traveled (VMT) tax should be considered. He mentioned that the Ways and Means Committee was working on some funding mechanism ideas.

Sen. Max Baucus (D-Mont.) has been confirmed as U.S. Ambassador to China. His confirmation will leave a vacancy for the chairmanship of the Senate Environment and Public Work Subcommittee on Transportation and Infrastructure. Sen. Baucus also leaves a vacancy for the chairmanship of the Senate Finance Committee, which will be the committee of jurisdiction for funding the upcoming surface transportation reauthorization.

Tomorrow, the Senate Environment and Public Works Committee will hold a hearing titled “MAP-21 Reauthorization: The Economic Importance of Maintaining Federal Investments in our Transportation Infrastructure.” Witnesses include Thomas Donohue, President and CEO of the U.S. Chamber of Commerce; Richard Trumka, President of the AFL-CIO; Mike Hancock, President of the American Association of State Highway and Transportation Officials and Secretary of the Kentucky Transportation Cabinet; and Jay Timmons, President and CEO of the National Association of Manufacturers. More information, witness testimony as it becomes available, and streaming will be available here.

Thursday, the Senate Commerce, Science, and Transportation Subcommittee on Surface Transportation and Merchant Marine Infrastructure, Safety, and Security will hold a hearing titled “Enhancing our Rail Safety: Current Challenges for Passenger and Freight Rail.” Witnesses include Cynthia Quartermain, Administrator of the Pipeline and Hazardous Materials Safety Administration; Deborah Hersman, Chairman of the National Transportation Safety Board; Geoffrey Blackwell, Chief of the Office of Native Affairs and Policy of the Federal Communications Commission; Jack Gerard, President and CEO of the American Petroleum Institute; and Ed Hamberger, President and CEO of the Association of American Railroads. More information, witness testimony as it becomes available, and streaming is available here.

On February 26, the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines, and Hazardous Materials will hold a hearing titled “Oversight of Passenger and Freight Rail Safety.” More information, witness identities and testimony as they become available, and streaming will be available here.

On February 27, the House Transportation and Infrastructure Subcommittee on Highways and Transit will hold a hearing titled “Improving the Nation’s Highway Freight Network.” More information, witness identities and testimony as they become available, and streaming will be available here.

On March 4, the House Transportation and Infrastructure Subcommittee on Coast Guard and Maritime Transportation will hold a hearing tiled “Maritime Regulations: Impacts on Safety, Security, Jobs and the Environment.” More information, witness identities and testimony as they become available, and streaming will be available here.


The Congressional Budget Office has released a10-year projection of highway trust fund accounts. The CBO estimates that “the highway and transit accounts of the Highway Trust Fund will have insufficient revenues to meet obligations starting in fiscal year 2015” under CBO’s February 2014 baseline.

On February 3, the National Highway Transportation Safety Administration announced that it plans to mandate vehicle-to-vehicle (V2V) communication technology for light vehicles. In August 2012, the Department of Transportation conducted a pilot program of 3,000 vehicles in Ann Arbor, Mich., to test the technology. V2V will allow vehicles to detect other vehicles and provide warning to the drivers of the automobile, but would not facilitate automatic operations, track drivers or use personally identifiable information in its communications. NHTSA will release a report of its findings and analysis from the pilot program “in the coming weeks” and “will then begin working on a regulatory proposal that would require V2V devices in new vehicles in a future year, consistent with applicable legal requirements, Executive Orders, and guidance.”

The Federal Motor Carrier Safety Administration released its “Field Study on the Efficacy of the New Restart Provision for Hours of Service.” The study, which analyzes the efficacy of the FMCSA’s 34-hour restart provision, “included 106 participants, 1,260 days of data and nearly 415,000 miles of driving that were recorded by the truck-based data acquisition systems” and its analysis shows that the rule “will prevent approximately 1,400 crashes and 560 injuries, and save 19 lives each year.”

On February 4, the National Highway Traffic Safety Administration issued a notice of public listening session and request for comment for a February 24 public listening session on its 2014-2018 Strategic Plan.

On February 3, the Government Accountability Office released a report titled “Federal Motor Carrier Safety: Modifying the Compliance, Safety, Accountability Program Would Improve the Ability to Identify High Risk Carriers.”

On February 3, the Office of the Inspector General of the Department of Transportation announced a self-initiated audit of the Department of Transportation’s (DOT) practices for certifying and issuing warrants to Contracting Officers. The review will not include the FAA.

On January 30, President Obama announced his intention to re-nominate William P. Doyle as Commissioner of the Federal Maritime Commission until June 30, 2018. Commissioner Doyle was originally confirmed by the Senate on January 1, 2013.


California: On February 7, the California High-Speed Rail Authority has released its Draft 2014 Business Plan. The plan is an update of its 2012 Business Plan, and cuts capital costs by 1 percent. The plan now carries an estimated total cost of $67.6 billion, whereas the 2012 plan estimates its costs at $68.4 billion. The updated plan also includes forecasts thatriders will be taking shorter trips, bringing in less revenue, increasing operations and maintenance costs, but yet still not requiring a taxpayer subsidy. The draft plan is required by law to be published 60 days prior to its submittal to the state legislature for public review and comment. The updated plan comes after significant Congressional, state, and judicial concern for the feasibility of the prior business plan, as detailed in our last Infrastructure Alert.

New York: On February 7, Governor Andrew Cuomo announced that all 112 “NY Works” accelerated bridge programs have been completed. Of the 112 projects, 32 were contracted through the design-build process, and 77 bridges were rehabilitated and three were built through the traditional contract bid process. The 2012-13 Budget allotted $212 million for initiative, and $687 million was allocated for nine signature transportation projects of regional or statewide significance throughout the state that had been delayed due to resource constraints, some of which are still under construction.

Texas: On February 10, the U.S. Department of Transportation announced an $840 million TIFIA loan for the Grand Parkway Project in Houston. The loan will finance the design and construction of certain portions of the 55-mile toll road. The total project cost is $2.5 billion. 

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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