1. Transportation Authorization FUNDING AND FINANCE Nancy J. Richardson Chair, Standing Committee on Finance and Administration Director, Iowa Department of Transportation

2. Session Topics 1.Current Status of Funding Issues 2.Proportions of Funding Shared Between Highway and Transit programs 3.Flexibility for Capacity 4.Distribution of Funds to Rural and Urban Areas 5.Options for Increasing Revenues 6.Issues on PPP’s and Tolling 7.Length of Extensions 8.Budget Issues – Baseline and Timing

3. 1. Current Status of Funding Issues Category SAFETEA-LU (6 Years) STAA (6 Years)Increase Safety$6.2 billion$12.6 billion100% Metro Mobility (Mode Neutral)n/a$50 billionn/a Transit$52.7 billion$99.8 billion89% If MM @ 50% for Transitn/a$124.8 billion137% Highways (Assumes 100% of PNS fund highways) $227.5 billion$287.4 billion26% If MM @ 50% for Highwaysn/a$312.5 billion37% If MM @ 100% for Highwaysn/a$337.5 billion48% TOTAL$286.4 billion$450 billion57%

4. 2. Proportions of Funding Shared Between Highway and Transit Programs Issue AASHTO’s Policy goal is to assure that the current proportions of funding between highways and transit are maintained. Comment The STAA proposal would substantially change the ratio of highway funding to transit.

5. 3. Flexibility for Capacity A key issue for AASHTO is the limits imposed on new capacity The Critical Asset Improvement Program as now drafted would make it impossible to address new capacity until a state of good repair is fully achieved A key objective is to ensure that States can make the necessary decisions to add capacity.

6. 4. Distribution of funds to Rural and Urban Areas AASHTO’s policy goal is to assure an adequate share for both rural and urban areas The funding as assigned would likely reduce the shares available for rural areas in favor of urban areas The solution is to assure the largest share of funds will go to States as apportioned funds

7. 5. Options for Increasing Revenues The goal of the Transportation and Infrastructure Committee is to fund a $450 billion bill and add $50 billion for High Speed and Intercity passenger rail Current revenue would not even support the SAFETEA-LU program level Options  Increase fuel taxes  Implement an oil-per-barrel tax  Near-term VMT fee  Bond for the interim period to enhance revenue or use some other borrowing method  Other options yet to surface

8. 6. Issues on PPP’s and Tolling The bill provides new requirements for PPP’s and tolling, including:  Creation of an “Office of Public Benefit” to oversee tolling and PPP projects  Key tests of benefits and approvals of toll rates at USDOT would be required Work is underway with a coalition of interest groups to develop alternatives to meet the public benefit tests

9. 7. Length of Extensions Current extension expires next week Key to the passage of an extension is preserving the baseline funding It is not clear now how Congress will proceed AASHTO has simply stated we want a well funded program and not taken a position on the length of the extension

10. 8. Budget Issues – Baselines and Timing Currently we are operating on a Continuing Resolution It is critical to pass an extension from the authorizers so that we get the benefit from a higher budget allocation We are approaching the end of the first extension and decisions on what and for how long the next iteration will go

11. Discussion