The US House of Representatives has approved a $7 billion infusion in the Highway Trust Fund, the government’s main funding source for highway projects, which is forecasted to be running on empty as soon as the beginning of September.
The measure, which passed by a vote of 363 to 68, will keep the Highway Account of the Trust Fund solvent through the end of the government’s current fiscal year, which ends in September 2009.
The Department of Transportation (DOT) had previously estimated that, without additional funding, the highway account would be in the red by $285 million by 4 September and $1.9 billion by 1 October. Such shortfalls would mean that the DOT would have to begin rationing its reimbursements to states for their highway projects, creating cashflow problems for already cash-strapped states unable to fund infrastructure budgets on their own.
“Restoring $7 billion to the highway account of the trust fund will cover the projected shortfall and provide a cash balance to offset any additional shortfall if the DOT estimates are in error,” Jim Oberstar, Chairman of the House Transportation and Infrastructure Committee, said in a statement on the house floor.
The Trust Fund, which was designed by lawmakers to approach a zero balance near the end of its authorisation under the 2005 surface transportation bill known as SAFETEA-LU (Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users), has zeroed out much earlier than expected due to declines in travel, high fuel prices and the recession.
Faced with a similar problem last year, Congress patched up the highway trust fund with an emergency $8 billion of interim funding.
“Unfortunately, the legacy that has been left for users is an over-extended Trust Fund, uncertainty, and potential funding cuts,” Oberstar said.
Oberstar said the additional funding is only a short-term measure and urged Congress to proceed with a longer-term bill to reauthorise the Trust Fund and other infrastructure-related government spending programs, which could total $500 billion.
Consideration of the bill, known as “The Surface Transportation Authorisation Act of 2009”, has been delayed as the House Ways and Means Committee, which handles taxation matters, has been busy with Congress’ consideration of a massive healthcare overhaul, which has also been delayed.