WASHINGTON INSIGHT

The year of public infrastructure: transportation, aviation and water infrastructure issues make 2003 a busy year

Jim Fahey
Director of Government Relations
APWA Washington Office

Not in some time have we seen a year quite like the kind 2003 is expected to be for policy-setting in Washington. There will of course be significant budget and tax issues, homeland security, difficult foreign policy decisions and other vital matters of public interest to be decided. But unlike recent years, 2003 also will be a time when Congress and the Administration will have perhaps its busiest year in recent memory addressing an unprecedented public infrastructure agenda.

Two laws authorizing nearly $260 billion in federal funding expire this year, one funding roads, bridges and public transportation, known as TEA-21, the other funding airport infrastructure and aviation programs, known as AIR-21. Reauthorizing just one of these in the course of a year is certainly a major undertaking; addressing both will be an enormous job.

In addition to these two transportation issues, Congress and the Administration will be considering ways to increase investment in wastewater and drinking water infrastructure, an issue that was debated last year. The funding required to address the documented needs of aging and deteriorating systems is estimated to be $23 billion annually. These programs currently are funded without authorizations.

Other issues as well are expected to be on the 2003 infrastructure policy agenda. The list comprises future investment in intercity passenger rail, authorization of the Corps of Engineers water resources projects, deployment of broadband, protecting vulnerable infrastructure, and providing resources and support to state and local governments for emergency response and preparedness needs.

Nevertheless, the two transportation and the water infrastructure issues together represent a sizable share of the nation’s public infrastructure investment and will occupy the attention of a number of Congressional committees and several federal agencies throughout the year as part of a long public works to-do list. Following is a quick overview of these three issues as they are being shaped at the start of 2003.

TEA-21
The Transportation Equity Act for the 21st Century, TEA-21, the six-year, $218 billion highway, bridge and public transportation law, expires on September 30 of this year. When passed in 1998, it was the largest transportation funding package ever signed into law, and it changed federal transportation policy by establishing guaranteed funding for transportation and linking transportation expenditures directly to revenues collected into the Federal Highway Trust Fund.

TEA-21 made tremendous strides in closing the gap in unfunded needs, but it did not eliminate it. In a recent report, the U.S. Department of Transportation cited highway needs totaling $61.2 billion annually by 2009, and public transportation needs of $12.4 billion annually, nearly twice current funding levels. With these investment requirements, the crux of this year’s reauthorization debate will be over the amount of funding authorized in the next bill and revenue sources to support it.

Representative Don Young (R-AK), who chairs the House Transportation and Infrastructure Committee, favors increasing investment by a combination of means, including a motor fuel tax increase. The Administration, however, does not favor a motor fuel tax increase, and prospects for such in the Senate appear uncertain at this time.

Other issues of the reauthorization debate will include streamlining the environmental review process for transportation projects, mitigating congestion; preserving TEA-21’s guaranteed funding provisions and funding “firewalls” (the budgetary mechanism ensuring highway trust fund revenues are invested each year in transportation); improving safety; promoting technology; and enhancing flexibility to address state and local funding needs.

AIR-21
The Aviation Investment and Reform Act for the 21st Century is a three-year, $40 billion law that, like TEA-21, expires September 30 of this year. Enacted in 2000, AIR-21 transformed aviation infrastructure investment policy in the same way TEA-21 did for surface transportation. It, too, provided guaranteed funding levels for aviation and tied expenditures directly to aviation trust fund revenues.

AIR-21 also provided significant funding increasing for state and local airport infrastructure. It reauthorized the Airport Improvement Program (AIP), which provides more than $3 billion annually for capital improvements for airport infrastructure, and it allowed state and local governments to increase the cap on passenger facilities charges from $3 to $4.50, to provide airports with funds to pay for airport construction without using AIP funds.

Issues central to the AIR-21 reauthorization debate will be AIP funding and eligibility, the financial difficulties of the airline industry, aviation security, issues associated with Federal Aviation Administration organization, preservation of the Airport and Airway Trust Fund “firewalls” (which like TEA-21’s firewalls tie revenues to funding), and the Essential Air Service Program. House Aviation Subcommittee Chair John Mica (R-FL) plans several hearings in the early part of the year on AIR-21 reauthorization.

Wastewater and Drinking Water Infrastructure
Bills were introduced last year in both the House and Senate to authorize tens of billions of dollars in multi-year funding through state revolving loan fund (SRF) programs, to address the needs of aging drinking water and wastewater infrastructure. Currently, funding for these programs through SRFs totals approximately $2.2 billion annually.

Legislation to boost this investment is expected to be debated again this year. Already in the House of Representatives, Reps. Sue Kelly (R-NY) and Ellen Tauscher (D-CA) have introduced a bill providing $25 billion over five years to capitalize the Clean Water SRF. Senator George Voinovich (R-OH) has introduced a bill in the Senate to authorize $15 billion over five years for the Clean Water SRF.

Sustained funding levels to meet the needs will be a key part of this year’s debate over water infrastructure legislation. In addition, sources of funding, including establishment of dedicated sources, plus grants, loans, the conditions for funding, asset management, management practices, eligibility and Davis-Bacon provisions—requirements to pay prevailing wages for any project funded with federal dollars—all will factor into the water infrastructure investment debate this year.

To reach Jim Fahey, call (202) 408-9541 or send e-mail to jfahey@apwa.net.