Obama Administration Unveils Transportation Spending Plan

With the "Grow America Act," the Obama administration wants to spur Congress to find money for roads, rail and transit before the federal government runs out of transportation money this summer.
by | April 29, 2014 AT 6:30 PM

U.S. Transportation Secretary Anthony Foxx on Tuesday sent Congress a plan that provides details of how the agency would like to spend $302 billion over the next four years on transportation projects.

The plan includes new money for the chronically underfunded Highway Trust Fund. The proposal would include $63 billion over the next four years to make sure the fund does not run out of money while paying for the current level of services. On top of that, there would be another $87 billion for repairs and construction beyond what the federal government pays for now.

The Highway Trust Fund, which draws most of its money from fuel taxes and provides the lion’s share of federal transportation money to states, could run dry this summer without congressional action.

The proposal from the Obama administration would add new money by making changes in the corporate tax code. The administration has provided few details of those tax proposals, but Foxx said they would include taxing overseas revenues of U.S. companies and revising manner in which compnaies are taxed for equipment . Obama's proposal would not raise federal gas and diesel taxes, which have remained level since 1993.

“States are already canceling or delaying projects because of the uncertainty at the federal level,” Foxx told reporters. “The only way we’re going to fix this is if everyone puts their ideas on the table and has an honest discussion about where we can find common ground.”

The proposal, dubbed the “Grow America Act,” comes as the current surface transportation law is set to expire this fall. The current law, called MAP-21, lasted only 27 months, because lawmakers could not agree on how to pay for a longer-term deal.

But even the money Congress set aside under the current law likely will not be enough to get it through the summer, according the U.S. Department of Transportation. Foxx said the trust fund could run dry by August.

President Barack Obama also urged Congress in February to rewrite corporate tax laws to fund transportation improvements. A few key members of Congress have supported similar ideas, but the idea has not gained much traction. In fact, no proposal to raise new revenues has received much support so far.

Foxx, the former mayor of Charlotte, North Carolina, said the administration’s legislation would encourage regional planning and “give cities and towns across America a louder voice in how we allocate federal funding in their communities.”

Obama's transportation legislation spells out how the administration would like to spend the new transportation money. It also suggests changes in law and new programs Congress could create. The proposal would:

  • Allow states to toll existing interstate highways.
  • Require states to coordinate efforts to install broadband lines with its highway construction projects.
  • Fund improvements to both passenger and freight rail lines, including high-speed rail between cities.
  • Require the U.S. DOT to find ways to speed up environmental reviews and other permitting processes for new transportation projects.
  • Allow states to install charging stations for electric vehicles on interstate rest stops.

Congress would likely make major changes to Obama's proposal, if it acts on it at all. But Foxx said it is intended to spur congressional negotiations. The House GOP criticized the president for not offering legislation during negotiations over the last major surface transportation bill.