The House of Representatives recently passed legislation to provide an additional $521 million in highway funding, which if passed by the Senate, would increase allocations for 37 states. The “hold harmless” funding is included as highway formula funds in the tax-extenders bill, HR 4213 - the American Jobs & Closing Tax Loopholes Act, to ensure no state loses highway funding as a result of a provision in the bill that amends the distribution formula for two highway categories, as required by the Hiring Incentives to Restore Employment (HIRE) Act, enacted in March. States that did not receive money from the two programs under the HIRE Act would receive additional funding. In addition, the bill includes an extension of the Build America Bonds, created by the American Recovery & Reinvestment Act of 2009, which subsidizes interest costs for bonds paid by state/local governments to finance infrastructure projects.
House Transportation & Infrastructure Committee Chairman James Oberstar, D- Minnesota, has been working for months to amend the way the HIRE Act distributes nearly $1 billion in funding for SAFETEA-LU’s Projects of National and Regional Significance and National Corridor Infrastructure Improvement Programs. This act mandates the distribution of the two programs’ Fiscal Year 2010 funding to 29 states that received discretionary funds under “SAFETEA-LU.”
The provisions in HR 4213 revise the distribution of funding so that every state receives a share of funds available under the programs. In addition, Oberstar said the highway funding provided in HR 4213 will provide thousands of jobs across the states in the construction sector.
The act also includes expansion of the Build America Bonds for two years, through 2012. The bonds extension is expected to cost the federal government $4 billion in interest subsidies over ten years.
The Senate is expected to consider the bill the week of June 7th.
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