Infrastructure Alert - July 10, 2013

by Cozen O'Connor

The American Association of State Highway and Transportation Officials (AASHTO) has released a Waterborne Freight Transportation report. The report finds that the status quo of waterborne freight is unsustainable and recommends federal legislation for repair and improvements of the marine transportation system’s waterways, the creation of a new Office of Multimodal Freight in the Department of Transportation, and the promotion of best practices in marine transportation system planning and investment.

The Business Roundtable has released a report titled “Catalyst for Growth: America’s Hybrid Infrastructure.” The report details the successes and potential of integrating information technology with physical infrastructure to increase efficiency and effectiveness. The report also recommends policymakers and the private sector develop a strategy to deploy hybrid infrastructure, reduce regulatory barriers to their use, and promote hybrid infrastructure on a national level.


On June 27, both the Senate and House Appropriations approved two very different FY2014 Department of Transportation and Department of Urban Development appropriations bills. The $44.1 billion House bill was approved by the Appropriations Committee on a party-line 28-20 vote, and the $54.0 billion Senate bill was approved by the Appropriations Committee on a 22-8 vote. The FY2013 enacted budget authority was $51.7 billion.

Notable differences include discrepancies between Amtrak and Transportation Investment Generating Economic Recovery (TIGER) grant funding. The Senate bill funds Amtrak at $1.45 billion, $137 million more than the FY2013 enacted level, whereas the House bill funds Amtrak at $950 million. The Senate bill funds TIGER grants at $550 million, whereas the House bill eliminates the program. Both the House and Senate bills fund the air traffic control contract towers through September. Both bills fully fund the Federal Transit Administration and federal highway program at the full Moving Ahead for Progress in the 21st Century (MAP-21) authorized levels. Both bills fund Airport Improvement Program grants at $3.35 billion.

House Transportation and Infrastructure Committee Chairman Bill Shuster (R-Pa.) expects his committee to markup a Water Resources Development Act bill this month but does not expect to markup an Amtrak reauthorization bill until at least September.

Rep. Rosa DeLauro (D-Conn.) has reintroduced her infrastructure bank bill. H.R. 2553, the National Infrastructure Development Bank Act of 2013, currently has 63 cosponsors and has been referred to the Committees on Energy and Commerce, Transportation and Infrastructure, Financial Services, and Ways and Means. Rep. John Delaney (D-Md.) circulated a "Dear Colleague" letter in support of his own infrastructure bank bill the same day that Rep. DeLaurointroduced hers. His bipartisan bill, H.R. 2084, has 33 cosponsors. Rep. DeLauro’s infrastructure bank would be capitalized with $25 billion in appropriations, and would self-sustain through revenues from financed projects. Rep. Delaney’s proposal, however, would be capitalized not through appropriations but through taxes from repatriated overseas earnings.

Sen. Chris Coons (D-Del.) has joined the Senate Committee on Appropriations, filling the late Sen. FrankLautenberg’s vacancy. Sen. Martin Heinrich (D-N.M.) has joined the Senate Committee on Commerce, Science, and Transportation, filling another vacancy left by Sen. Lautenberg.

Due to the election of Senator-elect Ed Markey (D-Mass.), a new Ranking Member of the House Natural Resources Committee will be elected next week. Reps. Raúl Grijalva (D-Ariz.) and Peter DeFazio (D-Ore.) have been actively campaigning for the post. If Rep. DeFazio were to be elected, he would have to step down as Ranking Member of the House Transportation and Infrastructure Subcommittee on Highways and Transit.

Reps. David Joyce (R-Ohio) and Doris Matsui (D-Calif.) have introduced H.R. 2468, the Safe Streets Act of 2013. The bill would institute “Complete Streets” policies, which 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.

Coinciding with the reopening of the I-5 bridge, Rep. Nick Rahall (D-W.Va.), Ranking Member of the House Committee on Transportation and Infrastructure, introduced H.R. 2428, the Strengthen and Fortify Existing (SAFE) Bridges Act of 2013. The SAFE Bridges Act would provide $2.75 billion per year in FY2013 and FY2014 for states to rehabilitate and reconstruct deficient bridges. The bridge funding provided by the SAFE Bridges Act is distributed among the states based on a needs-based formula on each state’s relative share of the total cost to repair or replace deficient highway bridges. The Department of Transportation classifies one in every four bridges as structurally deficient or functionally obsolete. 66,749 bridges are structurally deficient and 84,748 are functionally obsolete.

Rep. Ed Whitfield (R-Ky.), Rep. Allyson Schwartz (D-Pa.), Sen. Ron Wyden (D-Ore.), and Sen. John Hoeven (R-N.D.) have introduced bipartisan legislation in the House and the Senate to create Transportation and Regional Infrastructure Project (TRIP) bonds to fund infrastructure. The Transportation and Regional Infrastructure Project Bonds Act of 2013, H.R. 2534/S. 125, would create 30-year, privately leveraged TRIP bonds that would allow each state to issue up to $1 billion in bonds over the next six-year period. The bonds would be required to be issued by a state infrastructure bank, so states that have not created an infrastructure bank would have to do so to issue TRIP bonds.

On June 25, Reps. Tom Cole (R-Okla.), Ileana Ros-Lehtinen (R-Fla.), Eliot Engel (D-N.Y.), Allyson Schwartz (D-Pa.), Steve Israel (D-N.Y.), and Collin Peterson (D-Minn.) introduced H.R. 2493, the Open Fuel Standards Act of 2013. If enacted, the bill would require 30 percent of all new automobiles sold by 2016, and 50 percent by 2018, be “qualified vehicles” that include electric cars, compressed-natural-gas cars, biodiesel cars and fully flex-fuel (methanol-ethanol-gasoline capable) cars.


On July 2, Anthony Foxx was sworn in as the new Secretary of Transportation, the week after his unanimous, 100-0 vote Senate confirmation. As Secretary of Transportation, Foxx will handle several pressing issues this term. Without congressional action, budget sequestration will again cause numerous cuts to the Department of Transportation, and, most notably, the FAA, which could result in air traffic controller furloughs or contract tower closures. Foxx will also oversee the oft-delayed and complex NextGen Air Transportation System as the national airspace system transitions to a satellite-based air traffic control system. As Congress prepares bills for highway funding and Amtrak reauthorization, Foxx will make requests and ultimately implement the bills if and when passed. Former Secretary of Transportation Ray LaHood has joined the board of advisors of the University of Chicago’s Institute of Politics.

The Department of Transportation has approved its first increase in federal fund matching through a provision in the Moving Ahead for Progress in the 21st Century Act (MAP-21). The federally funded share of the U.S. 31 Hamilton County Improvement Project in Indiana has been increased from an 80 percent match to a 90 percent match, an increase of about $23 million. The Indiana Department of Transportation will now fund $207 million of the $230 million total with federal funding.

The FAA has released its NextGen Implementation Plan.


Eighteen states and the District of Columbia have joined a probe by the Department of Justice into the postposed American Airlines-US Airways merger over worries that states may lose flights, particularly to smaller cities and hubs. The states joining the investigation are Arkansas, Arizona, California, Florida, Iowa, Illinois, Minnesota, Mississippi, Nebraska, New York, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Virginia, Wisconsin and West Virginia.

Citizens for Tax Justice has noted that eight states raised their gasoline tax rates on July 1: California, Connecticut, Georgia, Kentucky, Maryland, Nebraska, North Carolina, and Wyoming. California, Kentucky, Georgia, and North Carolina’s gasoline tax rates rise automatically with higher gas prices. Wyoming and Maryland each passed legislation this calendar year that caused their gasoline taxes to increase, whereas Connecticut’s increase stems from a law passed in 2005. Nebraska’s gasoline tax rate rose due to an automatically adjusted rate that covers that amount of transportation spending authorized by the legislature.

California: The California High-Speed Rail Authority issued a report on potential greenhouse gas emissions last week. The report concludes that the proposed high-speed rail project would create a net-zero greenhouse gas emissions during construction and save an estimated 4 to 8 million metric tons of carbon dioxide by 2030. The report was required by SB 1029, the Budget Act of 2012, and included other environmental benefits as well.

Oregon: On July 7, the House of Representatives passed SB 810, which now requires the governor’s signature to become law. The bill creates a new, voluntary pilot program for up to 5,000 drivers to pay 1.5¢ per mile driven to receive a refund on gasoline taxes. While some Oregonians objected to alternate plans that required government-tracking of miles driven, many supported the voluntary nature of SB 810, and the bill passed on a 47-10 vote.

HB 2453, a vehicle miles traveled (VMT) tax bill that would have required motorists whose automobiles get at least 55 miles per gallon to pay 1.55¢ per mile driven after 2015 or $542.50 annually, was referred back to committee. Considering particularly that HB 2453 requires a three-fifths majority, the bill is considered to be defeated.

Texas: The Special Session of the Texas Legislature that began on July 1 will likely include a vote to approve a November referendum on a constitutional amendment that would direct half of the oil and gas severance taxes to the state highway fund, instead of the Rainy Day Fund as it does now. On June 24, the Texas House of Representatives approved the measure on a vote of 105-28, but a filibuster has delayed Senate consideration of the bill. The constitutional amendment is estimated to fund about $900 million per annum towards transportation funding.

Virginia: On July 1, numerous provisions of Virginia’s new transportation law were implemented. The law eliminates the 17.5¢ per gallon tax on gasoline, creates a wholesale motor fuel tax of 3.5 percent and a 6 percent diesel fuel tax, increases the state sales tax from 5 percent to 5.3 percent, and directs dedicated revenue to highway construction and maintenance.

Governor McDonnell also released the Office of Transportation Public-Private Partnerships’ (OTP3) Draft 2013 Virginia PPTA Pipeline. Praising public-private partnerships, McDonnell has stated that “Through partnering with the private sector, over $5 billion worth of infrastructure projects have been closed with limited state investment.” The 2013 PPTA Pipeline includes 10 candidate projects and 10 conceptual projects. The candidate projects are I-66 Corridor Improvements, Air Rights Development, I-64 HOV to HOT Conversion, I-64 Peninsula Improvements, Hampton Roads Crossing Improvements, I-73 Corridor Improvement Project, Route 460/58 Connector, I-495 Express Lanes Extension, Cell Tower/Fiber Optic Opportunities, and Route 460/I-85 Connector. The conceptual projects are Weigh-In-Motion Truck Validation System, Availability Payments, Wallops Island Visitor and Support Facilities, Advertising/Sponsorship Opportunities, Parking Facilities Enhancements, New Park and Ride Facilities, I-81 Managed Travel Lanes System, Rest Area Enhancements – Electric Car Charging Stations, Rest Area Enhancements – Truck Parking Facilities at High Priority Locations, and Route 460 Business Corridor Improvements.


On July 2, the U.S. Court of Appeals for the D.C. Circuit ruled that Amtrak may not jointly develop regulations with the federal government. Federal law had directed Amtrak to work with the Federal Railroad Administration to develop rules that maintain Amtrak’s service over other trains on certain tracks. Once the rules were finalized in 2010, the Association of American Railroads sued the federal government on the grounds that permitting a private company to develop regulations was unconstitutional, to which the court has agreed.

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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