McConnell-Boxer bill sets six-year federal transport funding plan; establishes multimodal freight policy

A tentative six-year deal has been struck to fund the nation's surface-transportation programs with provisions establishing a national multimodal freight policy and creating a dedicated funding stream for multimodal projects.

The bipartisan legislation, announced late yesterday, also requires that motor carrier safety scores developed under the auspices of the Department of Transportation's Compliance, Safety, Accountability program (CSA) be withdrawn from public view for nearly two years. The Transportation Research Board would have 18 months from the bill's enactment to conduct a study of the CSA program, and the Secretary of Transportation would have up to four additional months to implement the research board's recommendations. Trucking interests said the scores should be withdrawn because they are built on faulty methodology and incomplete data. Safety advocates argue that hiding carrier safety scores from the public enables unsafe carriers to conceal operational problems and puts the traveling public at risk.

The bill, called the "Developing a Reliable and Innovative Vision for the Economy" (DRIVE) Act, was negotiated by Senate Majority Leader Mitch McConnell (R-Ky.) and Sen. Barbara Boxer (D-Calif.), ranking member of the Senate Environment and Public Works Committee. It still must scale some hurdles. Senate democrats late yesterday voted not to begin debate on the bill because the legislative text was released less than an hour before a scheduled floor vote, giving lawmakers no time to review it. It is expected that the bill would be taken up on the Senate floor either later today or tomorrow.

In addition, the House of Representatives has already voted to extend the current law, which is set to expire July 31, until the end of the year, to give Congress time to craft a long-term bill. With the summer legislative recess fast approaching, few expect the House to digest the 1,012-page Senate bill—and hash out any differences during the House-Senate conference process—fast enough to get a final bill approved by both houses and have it reach President Obama's desk for signature. The most likely scenario is that the Senate would vote to extend the current law for the same amount of time as did the House, and then both would return from recess to work from the framework established under the McConnell-Boxer deal.

The bill provides three years of guaranteed funding from the Highway Trust Fund, the mechanism used to disburse funds for transportation projects. About $45 billion would come from a hodge-podge of spending offsets and be supported by approximately $34 billion in annual motor-fuels tax receipts that are used to support the Trust Fund. About $16 billion of the $45 billion in offsets would come from a reduction in the interest rate on dividends paid by the Federal Reserve to banks with more than $1 billion in consolidated assets. About $9 billion would be generated by the drawdown and sale of 101 million barrels of crude oil from the Strategic Petroleum Reserve, which accumulates huge oil stockpiles to be released in the event of a major emergency. Another $4 billion would come from indexing Customs-inspection user fees to the rate of inflation.

The national multimodal freight policy, which would be overseen by the DOT's undersecretary of policy, calls for the creation of a national freight network connecting port, highway, and rail nodes within one year of the bill's enactment. The network would be populated with multimodal facilities and corridors considered vital to the nation's goods-moving system.

Within three years of enactment, the DOT secretary would be required to complete a national freight strategic plan assessing the performance of the projects selected to be in the network, and identifying shortcomings and bottlenecks in the system. The strategic plan would be reviewed every five years.

The bill calls for a $12.45 billion apportionment to freight projects over six years, with a 10-percent maximum allocation for multimodal initiatives; the bulk of the freight funding would go to highway-only projects. In addition, the bill funds multimodal under a program dubbed "Assistance for Major Projects." Under the program, multimodal would receive a maximum of 20 percent of $2.4 billion in funding over six years. Funding for both programs would come from the Highway Trust Fund.

A third initiative, which came from a separate bill introduced in late June by Sens. Maria Cantwell (D-Wash.); Cory Booker (D-N.J.); Patty Murray (D-Wash.), and Edward Markey (D-Mass.) to establish a national multimodal policy, was incorporated in the McConnell-Boxer measure. It calls for $1.2 billion in funding over six years, but proceeds would need to be appropriated from the general treasury.

John N. Young, director of freight and surface transportation policy for the American Association of Port Authorities (AAPA), called the McConnell-Boxer bill "a step in the right direction" for multimodal interests. The freight-specific language reflects increasing visibility for freight, both in policy and funding, Young said. The bill elevates freight's stature within DOT, and the funding of freight programs through the trust fund demonstrates the growing importance that lawmakers place on multimodal connections, Young said.

That represents a sharp break from the past. Multimodal projects have been virtually invisible on the radar screen of transportation reauthorization negotiations. Freight interests have never been especially proactive on Capitol Hill, and the old adage that "freight doesn't vote" still seems to guide lawmakers when setting transportation priorities. For example, the Coalition for America's Gateways and Trade Corridors, a group of 60 public- and private-sector organizations that lobby for greater federal investment in intermodal infrastructure, has pushed for a minimum of $2 billion in annual spending on multimodal projects since it was formed in 2001. Funding has never attained that threshold, and 14 years later the group is still seeking the same minimum levels, said Elaine Nessle, its executive director.

In addition, multimodal projects, and freight projects in general, seeking funds from DOT's "Transportation Investment Generating Economic Recovery" (TIGER) competitive grant program have to vie with a large group of applicants. About $14.5 billion in funds were requested, roughly 29 times the $500 million in funds available.