City-County- State-Federal Cooperative Committee March 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 * 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 used 318 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 used 318 million less gallons diesel used September -- $2.7 billion In - $4.7 billion Out

Status of the Highway Account of the Highway Trust Fund (estimated)

Actual and forecasted Highway Account 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 $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 * 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 Inaugural Address – Jan. 20, 2009 “For everywhere we look, there is work to be done. The state of the economy calls for action, bold and swift, and we will act – not only to create new jobs, but to lay a new foundation for growth. We will build the roads and bridges, the electric grids and digital lines that feed our commerce and bind us together…All this we can do. All this we will do.” - President Barack Obama

The American Recovery and Reinvestment Act of 2009 (ARRA) Enacted February 17, 2009

Main Objectives of the Act 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 Information 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?