Topic: transportation
House Introduces American Energy and Infrastructure Jobs Act
Not to be outdone by President Obama, who recently called for a new round of the popular TIGER program, House Republicans have introduced the American Energy and Infrastructure Jobs Act. The bill, as proposed, would authorize $260 billion in funding over the next five years to repair the federal highway system. In addition, the bill would delegate more authority to individual states by eliminating mandates that states spend highway funding on non-highway activities and by allowing states to establish their own transportation priorities.
The new legislation would also remove government barriers to domestic energy production. It proposes eliminating the current ban on new drilling in offshore areas, establishes new guidelines for oil shale resources and technology, and opens the Arctic National Wildlife Refuge to energy exploration. Democrats argue, however, that such provisions put the environment at risk by giving a “gift to the oil industry.”
We will continue to monitor the American Energy and Infrastructure Jobs Act as the bill works it way through both houses.
TIGER Program Enters 4th Round
President Obama is making good on his State of the Union promise to provide for greater investment in infrastructure. In an announcement by Department of Transportation Secretary Ray LaHood, the TIGER (Transportation Investment Generating Economic Recovery) Discretionary Grant program will enter a fourth round, making another $500 million available for capital investments in surface transportation projects. TIGER 2012, as it is being called, will focus on projects having a significant impact on the nation, metropolitan areas or regions. High-speed rail and intercity passenger rail projects will remain eligible for funding.
Because of high demand, funds will be distributed on a competitive basis. In previous rounds of the TIGER program, the Department of Transportation allocated $2.6 billion toward 172 projects throughout the United States and its territories. This was despite over 3,348 applicants requesting more than $95 billion in funding. The Department of Transportation will evaluate each proposal’s safety, economic competitiveness, livability, environmental sustainability, state of repair and potential for short-term job creation.
Judge Rules Part of AB 32 Unconstitutional
A district court judge in California dealt a major setback to AB 32, California’s landmark global warming law. With the goal of reducing greenhouse gas emissions to 1990 levels by 2020, AB 32 set a Low Carbon Fuel Standard that required the carbon content in gasoline to be reduced by 10% and required that 20% of total gasoline used in the state come from renewable fuels.
The law was one of the first in the country to use a “carbon intensity” analysis to determine the total amount of green house gases emitted during the production and transportation of fuel. By capping the amount of carbon permissible in the fuel, the law would provide marketable credits to producers and distributors who emitted less carbon. Those who could not comply with the standard would face increased fuel costs as they would be forced to buy additional credits.
However, the law, which went into effect this year, may have stalled before even leaving the gates. According to the judge, the new standard unconstitutionally discriminated against out-of-state producers and attempted to regulate activity that occurred outside of state borders. As a result, the law violated the Dormant Commerce Clause of the Constitution.
The lawsuit was brought by various farm groups, ethanol producers, refiners and truckers. The California Air Resources Board has said it would appeal.
Weekly Quick Hits
Dirtiest Cities in America – Forbes releases its list of dirtiest cities. (Forbes)
Google Abandons Effort to Make Cheap, Renewable Energy – Google’s ambitious plans to make renewable energy more affordable than coal have ended. (Fox News)
Jefferson County Receiver Lobbies for Continued Authority – The court-appointed receiver managing bankrupt Jefferson County’s sewer system warns of harm to the municipal bond market if a federal judge strips him of his authority. (Bloomberg)
A Step Backward for Hybrid Cars? – Federal officials launched a formal safety defect investigation into GM’s plug-in hybrid vehicle after crash tests on several Volts resulted in fires. (Los Angeles Times)
Two-Year Transportation Bill Approved by Senate Committee
The Senate Environmental and Public Works Committee recently voted 18 to zero to approve a bipartisan, $109 billion, two-year surface transportation bill called ”Moving Ahead for Progress in the 21st Century“ (S. 1813). “MAP-21″ maintains current funding levels for highways and provides another $2 billion for federal credit assistance for projects. Three other U.S. Senate committees – Banking, Finance and Commerce, Science, and Transportation – are expected to add provisions to the bill regarding transit, revenue, and safety and freight.
Senator James M. Inhofe (R-OK), the top Republican on the committee, who drafted the bill together with committee chairwoman Senator Barbara Boxer (D-CA), said the measure still has a $12 billion shortfall because of declining revenue in the highway trust fund, which is funded with gas taxes and other user fees that are used for highway programs.
Senator Boxer said the bill would protect 1.8 million existing transportation jobs and create up to one million more jobs by leveraging federal funds. For example, the bill would increase funding by $1 billion per year for the Transportation Infrastructure Finance and Innovation Act (TIFIA) program, which provides federal loans, loan guarantees and standby lines of credit to finance surface transportation projects of national and regional significance. The bill would also increase from 33% to 49% the total amount of TIFIA credit assistance that could be used for transportation projects.
Transportation groups, most of whom seek longer-term legislation, nevertheless applauded the committee’s action and urged lawmakers to move the bill forward. The last reauthorization bill, the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users, expired in September 2009 and has been temporarily extended eight times.
One Step At a Time: Regional Planning for a Pedestrian Future
In a new move toward creating a more sustainable transportation network throughout Southern California, regional transportation agencies are poised to pass a long-term plan that dramatically increases funding for bicycle and pedestrian infrastructure, moving away from road and highway infrastructure. Southern California Association of Governments (SCAG), the regional planning joint powers authority that covers Los Angeles, Orange, San Bernardino, Riverside, Ventura and Imperial counties, passed a measure that almost triples the regional investment in bicycle and pedestrian projects.
SCAG’s move coupled with that of San Diego Area Governments (SANDAG), which already passed its own regional plan, are evidence of the commitment to California’s greenhouse gas emissions law SB 375, that mandates improvements in air quality with reductions in vehicles miles traveled.
California’s $1.8B Bond Sale Creates “Homegrown Economic Stimulus”
This week, California sold $1.8 billion in tax-exempt bonds. Preliminary yields ranged as low as 1.15% on three-year securities. 10-year bonds were priced to yield 3.51%, or 0.34 percentage point more than securities with a comparable maturity in a $2.5 billion sale in September 2011. 30-year bonds were offered at seven basis points more than in September. In addition to the $1.8 billion in tax-exempt bonds, California offered $200 million in taxable debt.
California’s Governor Brown called the bond sale a “Homegrown Economic Stimulus,” touting the ability of the state to put people to work through infrastructure jobs:
“When we invest in infrastructure, we provide a homegrown economic stimulus to create jobs and ensure our state is prepared for the challenges of the future,” said Governor Brown. “Investor confidence in California’s fundamental strengths, combined with an on-time, balanced budget, means that we can make important investments to boost the state’s economic recovery and put Californians back to work.”
The following summary, taken from the Office of Governor website, shows how certain of the bond proceeds, as well as existing fund balances, are being put to work:
- California Department of Transportation - Caltrans will be able to start 26 new projects, with a total (multi-year) construction cost of $1.2 billion. The projects, which are expected to create 30,000 jobs, are designed to increase traffic flow by adding lanes, widening roadways and installing traffic management systems.
- Local Streets and Roads – Approximately $38 million in bond proceeds will be used to start roughly 70 local street and road projects, including mainly general maintenance projects on local roads, such as sealing and resurfacing. Many cities and counties have combined these funds with other local or federal funds to complete larger road projects.
- K-12 School Construction – Existing funding for K-12 school construction will be fully expended by December 2011. The additional $1 billion provided in the fall 2011 bond sale will fund the start of approximately 450 new projects, which are anticipated to consist of approximately 250 modernization projects, 130 new construction projects and 70 other projects.
- California Community Colleges – Community Colleges will be able to start five new construction and modernization projects with the $24 million in additional bond proceeds.
Recap of @BarackObama’s Speech to Congress
With the nation’s unemployment rate at 9.1 percent, President Obama addressed a joint session of Congress to share a plan to create jobs and grow the economy. His $447 billion plan, the American Jobs Act, includes the following measures:
- $50 billion for infrastructure development such as repairing roads and bridges.
- $10 billion to capitalize a national infrastructure bank to help finance such projects.
- payroll tax cut to put an additional $175 million into the pockets of working Americans.
- extending unemployment benefits, which were lengthened to the current 99-week maximum in 2009.
Other provisions in the president’s proposal include money to refurbish schools and provide state aid for teachers and first responders. For greater detail on the American Jobs Act, download the fact sheet here.
Weekly Quick Hits
Obama Pushes Transportation Bill – In his weekly radio address, President Obama pushed Congress for an extension of the Surface Transportation Bill. (Boston Globe)
Smart Meter Can Tally Savings – The City of Glendale, California is on the cutting edge of smart meter technology, deploying over 75,000 units that display electricity and water usage on a small digital console. (Los Angeles Times)
Getting a Grip on the Grid – Technology makes advances toward understanding the temperature fluctuations that cause stress in underground utility lines. (New York Times)
Shutdown of Transportation Programs Possible – Officials warn that as many as one million jobs are at risk if Congress does not pass extensions of certain federal transportation and aviation programs. (Associated Press)
Weekly Quick Hits
Fish Oil to Reduce Lead Contamination – The Environmental Protection Agency is overseeing a project in Oakland that uses a paste made from fishbone meal to reduce lead contamination in soil. This marks the first residential use of the practice, which is less financially demanding than replacing the contaminated soil. (The New York Times)
Are Wind Farms Eye Sores? – As wind farms multiply to keep up with the growing demand for clean energy, so do nearby residents’ complaints about the 450-foot eyesores. (Los Angeles Times)
Will Cellulosic Ethanol Fulfill Its Promise? – In 2006, cellulosic ethanol was expected to be a feasible alternative to energy-intensive ethanol made from corn by 2012. Today, cellulosic production lags significantly behind previous production estimates, and critics contend that it is a failure of government policy — rather than science — that is to blame. (Reuters)
Rail Funds Redirected to Missouri – Plans for the nation’s first truly high-speed rail network, which would link Los Angeles to the Bay Area with 220-mph trains, is in jeopardy after House Republicans voted last week to redirect all high-speed rail funds to flood-control projects in Missouri. (San Francisco Chronicle)
