CONGRESSWOMAN ELISE STEFANIK
On Tuesday, September 13, 2011, the House is scheduled to consider H.R. 2887 under a suspension of the rules requiring a two-thirds majority vote for approval. H.R. 2887 was introduced by Rep. John Mica (R-FL) on September 12, 2011, and was referred to the House Committee on Transportation and Infrastructure as well as the Committee on Ways and Means. Neither committee took any official action.
H.R. 2887 would extend the authority to appropriate funds from the Highway Trust Fund (HTF) for federal highway and surface transportation programs through March 31, 2012 (half of FY 2012). Under current law, surface transportation spending authority is set to expire at the end of fiscal year 2011. The bill would also extend the authority to expend funds from the Airport and Airway Trust Fund and extend taxes on aviation fuel, domestic and international ticket taxes, and taxes on cargo shipped by air through January 31, 2012. Currently, the FAA’s authorization and authority to levy taxes are set to expire September 17, 2011.
Surface Transportation Reauthorization
H.R. 2887 would extend the authority to appropriate funds from the Highway Trust Fund (HTF) for federal highway and surface transportation programs through March 31, 2012 (half of FY 2012). Current authority to appropriate funds from the HTF under the Safe, Accountable, Flexible, Efficient Transportation Equity Act: a Legacy for Users (SAFETEA-LU) was most recently extended in March 2011 by H.R. 662, the Surface Transportation Extension Act of 2011, and is set to expire on October 1, 2011, at the end of FY 2011. H.R. 662 was approved in the House on March 2, 2011, by a vote of 421-4 and was signed by the president on March 4, 2011. H.R. 662 set FY 2011 HTF transportation spending limits at $42.46 billion for highway funding and $10.33 billion for mass transit funding, which amounts to $52.7 billion total for FY 2011. H.R. 2887 would set the total obligation limitation levels for transportation funding at half of the total amount authorized for FY 2011. The funding level authorized by the bill is identical to CBO’s current baseline projection, thus enacting H.R. 2887 would not provide budget authority above amounts assumed under current law.
Federal-Aid Highway Programs: H.R. 2887 would authorize an obligation limit for highway program spending from the HTF from October 1, 2011, through March 31, 2012, at half of the total amount authorized from the HTF in FY 2011 ($42.46 billion). The amounts authorized to be appropriated would be calculated by accounting for any rescission or cancellation of funds or contract authority in FY 2011, including in the Full-Year Continuing Appropriations Act. In addition, the bill would exempt $319.5 million from the obligation limitation for the equity bonus program, which is meant to give states a minimum return on their contributions to the HTF. H.R. 2887 would also authorize the appropriation of $196 million from the HTF for the administrative cost of the federal highway program.
Extension of Highway Safety Programs: H.R. 2887 would provide $742 million in spending authority for highway safety programs carried out by the National Highway Traffic Safety Administration for half of FY 2012, including:
H.R. 2887 would also authorize $299 million for the first half of FY 2012 for programs carried out by the Federal Motor Carrier Safety Administration, including $106 million for Motor Carrier Safety Grants and $122 million for Administrative Expenses.
Public Transportation Programs: H.R. 2887 sets the obligation limit for mass transit program spending authority from the HTF at $5.1 billion from October 1, 2011, through March 31, 2012. The bill would authorize $4.2 billion for Formula and Bus Grants and $800 million for Capital Investment Grants.
FAA Temporary Extension
H.R. 2887 would extend, through January 31, 2012, the authorities of the Federal Aviation Administration (FAA), which are currently set to expire on September 17, 2011. The bill would extend the authority to expend funds from the Airport and Airway Trust Fund and would extend taxes on aviation fuel, domestic and international ticket taxes, and taxes on cargo shipped by air.
The bill would authorize $3.5 billion to be appropriated for the Airport Improvement Program (AIP) for the entirety of FY 2011. The bill would authorize $1.2 billion to be appropriated for the AIP for the four-month period beginning on October 1, 2011, and ending January 31, 2012. In addition, the bill would authorize $9.5 billion for FAA operations for FY 2011 and $3.2 billion for FAA operations between the October 1, 2011 and January 31, 2012 period. The bill would authorize a total of $2.7 billion for the entirety of FY 2011 for facilities and equipment and would authorize $918 million for the first four months of FY 2012 for facilities and equipment.
Essential Air Services Reform
H.R. 2887 would modify the funding formula for the Essential Air Services (EAS) program which gives subsidies to air carriers that provide air service to certain rural communities. Specifically, the bill would require that a portion of the funding for EAS must be drawn from the Airport and Airway Trust Fund. The bill would authorize $150 million from the trust fund for the program for FY 2011 and $50 million from the trust fund for the first four months of FY 2012. In addition, the EAS would receive $50 million each fiscal year from FAA administration accounts through overflight fees.
The HTF was established in 1956 for the purpose of funding the construction of an interstate highway system. The account is administered by the Federal Highway Administration, within the Department of Transportation, and distributes gasoline tax revenues annually to states for highway projects. The vast majority of total receipts for the HTF come from the federal highway users excise tax (the remainder comes from truck-related taxes such as truck and trailer sales, truck tires and heavy-vehicle use taxes). Currently the 18.4-cent federal gasoline tax is distributed with one-tenth of one cent going to the Leaking Underground Storage Tank Trust Fund and the rest to the Highway Trust Fund's two accounts: 2.85 cents per gallon to fund the mass transit account and 15.44 cents per gallon to fund the highway account. The current highway program, the Safe, Accountable, Flexible, Efficient Transportation Equity Act—A Legacy for Users (SAFETEA-LU), expired at the end of FY 2009 and has since been authorized by a series of short-term extensions. The most recent extension was approved in March 2011 and is set to expire on October 1, 2011.
In recent years, revenues to the HTF have not kept pace with the outlays, dropping off sharply in 2008 when fuel hit record-high prices and consumption dropped. According to CRS, in 2008, $8 billion was transferred from the general fund to the HTF to fill a funding shortfall. In FY 2009 and FY 2010, the HTF received transfers of $7 billion and $20 billion, respectively, to keep the trust fund solvent. According to CBO’s January 2011 baseline, HTF receipts are estimated to drop by one percent in FY 2011 and total $29 billion. According to CBO, this would be the sixth consecutive year that HTF receipts have fallen. As a result, CBO estimates that the HTF will run a deficit of $7 billion in FY 2011, which is then predicted to double to $14 billion in FY 2012.
Federal Aviation Administration
The FAA is an agency within the Department of Transportation that oversees and regulates the nation’s aviation system. The Airport and Airway Trust Fund (AATF), created by the Airport and Airway Revenue Act of 1970, provides funding for the nation’s aviation system through several aviation excise taxes. Funding currently comes from collections related to passenger tickets, air cargo excise taxes, passenger flight segments, and aviation fuels, among other sources.
The last long-term authorization of the Federal Aviation Administration (FAA), known as the Vision 100—Century of Aviation Reauthorization Act, was approved in 2003 and expired at the end of FY 2007. Since that time, the FAA has operated under a series of temporary extensions. In the 110th and 111th Congresses, the House passed several short-term FAA extensions which were signed into law. Currently, FAA’s authorization and authority to levy taxes are set to expire September 17, 2011. FAA’s authority to collect aviation trust fund revenues and expend money in the trust fund expired on July 22, 2011, and was not reauthorized until the Senate approved H.R. 2553 on August 5, 2011.
In addition, the House approved a long-term FAA extension, H.R. 658, the FAA Reauthorization and Reform Act of 2011, which would reauthorize FAA operations, contract authority and taxing ability through FY 2014. The long-term FAA reauthorization was approved in the House on April 1, 2011, by a vote of 223 – 196. The Senate amended the language of H.R. 658 and replaced the text of the bill with a Senate substitute. This short-term extension would allow the FAA to continue operations while the two bills are reconciled.
Essential Air Services: The Essential Air Service (EAS) program provides subsidies to air carriers that provide air service to certain rural communities. Under current law, $77 million is authorized to be appropriated for the EAS program each year in perpetuity. H.R. 658, the long-term FAA reauthorization approved by the House on April 1, 2011, would phase out and sunset the program by providing an authorization of $98 million for the program in FY 2011, $60 million in 2012, and $30 million in 2013. No appropriations would be authorized after 2013. According to CBO, the bill would save $302 million over the 2011-2016 period by phasing out EAS.
A CBO cost estimate of H.R. 2887 was not available as of press time.