Friday, September 02, 2011

Showdown Looms Over FAA and Federal Gas Taxes

The fight over FAA funding will once again rear its ugly head as the September 16 deadline looms and Congressional Democrats and Republicans can't come to an agreement on authorizing another extension.

When the sides allowed the tax to lapse, the FAA lost nearly $250 million in revenues, which funds FAA operations, infrastructure improvements, and safety programs (although the Department of Transportation shifted funds around to keep safety and air traffic control operating). At the heart of the fight is continuing to operate a rural airline program to small airports.

But that fight is chump change next to the looming showdown over the extension of federal gas taxes. We're talking about a gas tax that provides $52 billion in revenue and funds hundreds of thousands of jobs in places like New York (118,000+ jobs) and Texas (128,000+ jobs) alone.

federal authorization for the federal gas taxes ends on September 30, and so far there's no indication that Congress will extend the tax, which is used to fund infrastructure maintenance and improvements throughout the country.
Both the federal authority to collect the 18.4 cents a gallon in federal gas tax and authorization to spend the revenue on transit and highway projects are due to expire.

“When Congress comes back, they’re only going to have 11 days to take action,” said Susan Martinovich, president of the American Association of State Highway and Transportation Officials. “There is a crisis brewing.”

Until the FAA extension turned into a major test of wills between House Republicans and Senate Democrats, it was considered relatively routine for Congress to extend current funding while working on big spending packages.

The Senate balked when the House sent over an FAA extension with other provisions attached. The Senate finally buckled and approved the extension, raising the fear that House Republicans might repeat the move when that extension expires Sept. 16 and when the two surface transportation measures come due two weeks later.

The state administrators said that the Senate had committed to passing a six-month surface transportation extension but that House Transportation Committee Chairman John L. Mica (R-Fla.) had not responded to their inquiries.

Although the two houses are in final negotiations over a long-term FAA reauthorization, neither the House nor Senate has approved a long-term surface transportation bill. State officials consider long-term funding plans essential because they need to be confident that funds will be forthcoming when they launch highway and transit projects.
President Obama has called for a clean bill with no provisos or limitations on the extension, but Republicans are looking to restrict how and where the money can be used.

Infrastructure spending is woeful around the country, and that affects safety and interstate commerce - both of which are federal government obligations under the Constitution. Infrastructure needs to be maintained and improved, and that costs money and the Republican demands to cut spending will hamper economic growth and potential, to say nothing of imperiling drivers and commuters and ends up costing taxpayers more down the road as the deferred maintenance allows minor problems become major ones that cost significantly more.

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