With only two more weeks before the Memorial Day recess, Congress will need to act soon to extend the authorization of the nation’s highway and transit programs, set to expire May 31, 2015. While the U.S. Department of Transportation Secretary Anthony Foxx has reported that the Highway Trust Fund (HTF) will likely become insolvent in late July or early August, Congress would need to pass an extension to authorize spending beyond the expiration. Members of Congress on both sides of the aisle have spoken in favor of a multiyear surface transportation bill, but have not been able to agree on a revenue source to pay for an extension of the HTF. It is therefore likely that a shorter-term extension of the program will be necessary, although the length of such an extension has also been the source of considerable disagreement. To fund the previous short-term HTF extension, Congress transferred approximately $11 billion from the General Fund which was offset by a variety of financing mechanisms such as “pension smoothing,” an extension of expiring customs duties, and funding transfers from the Leaking Underground Storage Tank Trust Fund. Those types of options appear to have been exhausted and Congress must now look toward other financing solutions.
Despite these challenges, Congress appears to be considering three options for an extension: through July when the trust fund is scheduled to become insolvent, through the end of the fiscal year to provide time for a potentially longer-term agreement to be reached, or through the end of calendar year. Political insiders fear that if Congress is unable to reach a long-term agreement before the end of fiscal year this September, we will be looking at a series of short-term extensions until well beyond the November 2016 elections. RCRC anticipates Congress will make an announcement on a funding extension in the coming week.