WASHINGTON -- Lawmakers may have kicked the can down the road when it came to topping off the Highway Trust Fund with cash, but at least that road will be paved. In a last minute vote prior to the summer recess, Congress approved a $10.8 billion bill that will sustain the flow of funds to states through May 2015. The approval came as the fund was set to run out of cash in the middle of the crucial summer construction season.
"Congress needs to act immediately to prevent a shortfall in the Highway Trust Fund ... Thousands of jobs are at stake here," Sen. Orrin Hatch (R-UT) said prior to the vote. "The only viable solution is for the Senate to take up the House bill and pass it ... We don't have any other options if we want to get this done before the recess."
The House had passed the bill in a 272-150 vote while the Senate approved it in an 81-13 vote. The final agreement between the Republican House and Democratic Senate comes after weeks of back and forth. The finished bill relies on what some have called a "gimmick" or "scheme" that allows companies to defer contributions to employee pension plans. Dubbed "pension smoothing," the delay of pension contributions raises corporate profits and taxes.
Democrats had been holding out for a long-term fix by raising the 18.3¢ a gallon fuel tax on gasoline and 24.4¢ on diesel. The tax, which has not been increased in 20 years, would have increased to above 25¢. If pegged to inflation, it would have provided a long-term fix to the problem.
"We do not have the luxury of time to deliberate or trade further ideas," said Rep. Nick Rahall (D- WV), the House Transportation Committee's top Democrat, who said he was going along with the House approach only to avert a funding crisis that would have forced the government to ration payments to states.