A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 1 Surface Transportation Authorization: Review of Mid-Course Policy and Strategy Funding and Finance Will Kempton Chair Standing Committee on Finance and Administration (SCOFA) Director California Department of Transportation

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 2 Presentation Outline Updating members on the status of the Highway Trust Fund Describing steps being taken to stabilize the fund in FY 2009 and 2010 Actions to repeal the $8.7 billion contract authority rescission provision in SAFETEA-LU Describing highlights from the Final Report of the National Surface Transportation Infrastructure Financing Commission Updating members on the FY 2010 President’s Budget proposal

Source: Federal Highway Administration

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 7 National Surface Transportation Infrastructure Financing Commission Short-term Recommendations Maintain/strengthen integrity of the Highway Trust Fund Increase existing HTF revenue sources: o Modest increases in fuel taxes (10¢ for gas, 15¢ for diesel) o Increase (double) the Heavy Vehicle Use Tax (HVUT) o Maintain existing tractor/trailer sales tax and truck tire tax o Index motor fuels tax, HVUT, and truck tire excise tax

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 8 National Surface Transportation Infrastructure Financing Commission Non-Federal Investment Options Tolling and Other Direct User Fee Initiatives Federal Assistance, Financing Incentives, Tax Policy Private Sector Financial Participation (PPPs)

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 9 National Surface Transportation Infrastructure Financing Commission Begin VMT Transition Begin transition as soon as possible; 2020 as implementation goal Set federal fee at level to fund federal share of needs (approx. 2¢ per mile for autos under current policies and estimates)

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 10 AASHTO Position on VMT Fee AASHTO Board of Directors o Congress should set a timetable to complete development of a new system as soon as it is practical o Fund research and development efforts to identify options for system design and technology o Fund a proof of concept tests of a VMT- based funding approach at $50 million per year for 2010 through 2012 with a report to Congress by 2013

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 11 Fiscal Year 2010 President’s Budget The detailed budget released last week provides the following: Recognition of the HTF crisis Trust fund on life support o Can only support $6 billion in the highway program in fiscal 2010 o The Administration proposes to appropriate $35.5 billion from the General Discretionary programs o Provides no path forward for the long-term programs States that the budget only represents a placeholder until the Administration can submit a proposal

A A S H T O S P R I N G M E E T I N G 1 7 M A Y B E D F O R D S P R I N G S, P A 12 Questions?