City-County- State-Federal Cooperative CommitteeMarch 18, 2009

Walter C. Waidelich Jr.California Division

Federal Highway Administration

Future Directions for the Nation’s Transportation

Program

Transportation:At a “Cross Roads”

Can’t avoid hard choices

Bumps in the Road

Tough decisions cannot be avoided

Highway Trust Fund Balances FY2004-FY2009*

-80-70-60-50-40-30-20-10

01020

($bi

llion

s)

Highway Account

Transit Account

* Source: Congressional Budget Office – does not reflect $8 billion General Fund transfer

2008 Vehicle Miles Traveled From November ‘07 thru June ’08….

A downward trend resulting in 53.2 billion less miles traveled

400 million less gallons gas used318 million less gallons diesel used

September -- $2.7 billion In - $4.7 billion Out

August 2007

Report of Section 1909

The National Surface Transportation Policy and Revenue Study Commission

Transportation for Tomorrow

Released: January 2008

The National Interest: Ten Focus Areas

Rebuilding America

Freight Transportation

Congestion Relief

Saving Lives

Connecting America

Intercity Passenger Rail Environmental Stewardship

Energy Security

Federal Lands

Research, Development, & Technology

2008 Vehicle Miles Traveled From November ‘07 thru June ’08….

A downward trend resulting in 53.2 billion less miles traveled

400 million less gallons gas used318 million less gallons diesel used

September -- $2.7 billion In - $4.7 billion Out

-10

0

10

20

30

40

50

Bil

lio

ns

of

$

Income

Outlays

Balance

Status of the Highway Account of the Highway Trust Fund

(estimated)

Actual and forecasted Highway Account balance

Actual and Forecast Highway Account Balance for FY2008

-1,000

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct

($ m

illi

on

s)

Actual Balance (before $8 billion transfer)Forecasted Balance

Pay As You Go + Fixes On September 5, 2008: Pay once a week on a

pro-rated basis Short Term – Congress fund $8 billion transfer

from General Fund (HR 6532 - $8.017 billion) Long Term – Do something dramatically

different (or not) Reauthorization Deadline September 30, 2009 Options?

More Focused Federal Program Raise Revenues Kick the Can Down the Road

Status of the Highway (and Transit) Trust Funds

Highway Trust Fund Balances FY2004-FY2009*

-80-70-60-50-40-30-20-10

01020

($bi

llion

s)

Highway Account

Transit Account

* Source: Congressional Budget Office – does not reflect $8 billion General Fund transfer

Effect of the Fall Elections on Reauthorization

Supports strengthening core infrastructure Has endorsed a National Infrastructure Bank Supports funding for Amtrak Supports development of high-speed freight and

passenger rail Supports strengthening metropolitan planning to

cut down traffic congestion Supports safeguarding transportation from

terrorism Supports reducing greenhouse gases and

reducing dependence on foreign oil

President Barack Obama President Barack Obama Inaugural Address – Jan. 20, Inaugural Address – Jan. 20, 20092009

“For everywhere we look, there is work to bedone. The state of the economy calls for action,bold and swift, and we will act – not only tocreate new jobs, but to lay a new foundation forgrowth. We will build the roads and bridges, theelectric grids and digital lines that feed ourcommerce and bind us together…All this we can do. All this we will do.”

- President Barack Obama

The American The American Recovery and Recovery and Reinvestment Act Reinvestment Act of 2009 (ARRA)of 2009 (ARRA)

EnactedEnactedFebruary 17, 2009February 17, 2009

Main Objectives of the Main Objectives of the ActAct

Job preservation and creation Infrastructure investment Energy efficiency and science Assistance to unemployed, and State and local fiscal stabilization

(Significant accountability and transparency requirements)

For More InformationFor More Information

http://www.fhwa.dot.gov/economicrecovery

Summary of Highway Provisions Funding Distribution Tables FAQs Best Practices

FY2009 Appropriations $71.5 billion for the Department of

Transportation 4% increase

$40. 7 billion for highways Obligation limitation of $40.7 billion (1.25% less

then FY08) Prevents $1B negative in Revenue Aligned Budget

Authority $3.15 billion general rescission in unused contract

authority $10.1 billion for transit

$10.231B Obligation limitation (9.25% increase over FY08)

$5.5 - $7.7B (8,000 to 8600 projects) earmarks

Reauthorization

SAFETEA-LU expires

September 30, 2009

Fundamental need for reform SAFETEA-LU funding levels cannot be sustained by the

Highway Trust fund without a tax increase Need to mainstream innovative financing

Proliferation of programs 102 highway and transit programs Biggest program is equity bonus

Earmarking 5,634 earmarks in SAFETEA-LU Many more in appropriations bills $10 billion in unobligated earmarks at end of FY2007

Process, not outcome-based program Lack of accountability for federal funds

Tough Questions: What is the Nation’s Transportation Policy

to ensure that different components of transportation infrastructure are funded adequately and fit together?

What is correct size of the pie for each mode?

What is the impact of the Economic Recovery Program on reauthorization?

How do we sub-divide the pie fairly? How do we generate a sustainable

funding mechanism?

It was the best of times……., it was the worst of times…………

Charles Dickens

May you live in interesting times……

Questions?