EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503

STATEMENT OF ADMINISTRATION POLICY
 (THIS STATEMENT HAS BEEN COORDINATED BY OMB WITH THE CONCERNED AGENCIES.)

October 8, 1997
(Senate)


S. 1173 Intermodal Surface Transportation Efficiency Act of 1997
(Warner (R) Virginia and 17 cosponsors)

Reauthorizing the Nation's surface transportation programs is the Administration's top transportation priority for this session of Congress. The Administration is pleased that S. 1173 is a 6-year bill, and that it addresses many of the President's priorities as reflected in the Administration's proposal. For example, the bill includes important environmental protection, welfare-to-work, and worker protection provisions; and expands the uses of the highway and mass transit capital funds. In addition, the Administration supports many of the safety provisions under consideration by the Commerce Committee.

The Bipartisan Budget Agreement. The Bipartisan Budget Agreement (BBA) between the President and the Congress increased highway spending by $10 billion. While the Senate reported bill is more consistent with the BBA than the 6-year bill considered by the House Transportation and Infrastructure Committee, S. 1173 still exceeds the total transportation spending levels assumed in the BBA -- including an additional $2 billion in mandatory outlays. However, the Administration understands that it is the managers' intent to modify the bill so that it remains within the bounds of the carefully crafted BBA. The Administration supports this goal and urges the Senate to craft a bill that is fully consistent with the BBA. The Administration would strongly oppose amendments to the bill which would further increase funding levels above those agreed upon in the BBA.

Amendment Concerns. The Administration commends the Senate for retaining ISTEA's disadvantaged business enterprise goals and uniform certification provision for highway projects, and strongly opposes any amendments to repeal or weaken these provisions. In addition, the Admin istration would oppose any amendments to weaken: the National Environmental Policy Act, the Congestion Mitigation and Air Quality Improvement Program (including allowing single occupancy vehicle projects to receive funding under the Program), or the Clean Air Act. The Administration is also committed to retaining ISTEA's labor standards and employee protection requirements afforded working people on federally assisted projects (including those assisted by State infrastructure banks), and would oppose any amendments repealing or limiting these protections. The Administration would also oppose changing the transit formula by adopting any form of minimum allocation for transit.

Major Concerns. The Administration supports Senate passage of a 6-year transportation bill, but will seek amendments to S. 1173 to address the concerns described below and the additional concerns discussed in the attachment.

  • The bill should be modified to be fully consistent with the Bipartisan Budget Agreement.

  • The bill's safety provisions should be strengthened by -- retaining the unbelted crash testing requirement; penalizing repeat drunk driving offenders at the same blood alcohol level as first offenders; including the Administration's criteria in the seat belt incentive program for States to increase seat belt use rates; and eliminating the special exemption from the Federal seat belt use law for New Hampshire.

  • S. 1173 should be amended to authorize the full $2.2 billion requested by the Administration for the Appalachian Development Highway System, and the full $161 million requested for National Park roads and parkways. The funding levels currently authorized in the bill are inadequate to support these important programs.

  • The bill should provide additional flexibility to State and local governments in establishing hiring preferences for in-State welfare recipients, in order to meet the aggressive targets included in the recent welfare reform law.
Finally, the Administration supports the use of alternate fuels to improve our nation's air quality, and therefore strongly supports the extension of the excise tax exemption for ethanol (but without phasing down the rates of the benefits).

Pay-As-You-Go Scoring. S. 1173 as reported would increase direct spending; therefore it is subject to the pay-as-you-go requirement of the Omnibus Budget Reconciliation Act of 1990. Therefore, if the bill were enacted and these costs are not offset during the remainder of this Congressional session, a pay-as-you-go sequester would be triggered at the end of the session. OMB's preliminary scoring estimates of this bill are presented in the table below. Final scoring of this legislation may differ from these estimates.

 PAY-AS-YOU-GO ESTIMATES
($ in millions)
 19981999200020012002 200398-03
Outlays712443354024635292,044

Attachment: Additional Concerns

The Administration supports Senate passage of a 6-year transportation bill, but will seek amendments to S. 1173 to address the major concerns described above and the additional concerns discussed in this attachment. The bill should be amended to:

  • Expand its intermodal focus by permitting State and local governments to use Surface Transportation Program (STP) funds for publicly owned freight rail infrastructure.

  • Retain the current 10 percent set-aside of STP funds for transportation enhancements.

  • Delete Section 1115 which would unnecessarily expand Federal Lands Program eligibility to include non-Federal aid eligible roads.

  • Delete two provisions that would dilute the effectiveness of the Hazard Elimination program by unnecessarily extending the program to the Interstate System (which is already our safest system of roads), and unnecessarily expanding program eligibility to include non-safety traffic calming projects.

  • Prevent confusion and duplication by deleting the provision that would give States the option of using or not using the metric system in connection with highway construction contracts.

  • Further expand the definition of capital to make contracted paratransit services for individuals with disabilities an eligible expense.

  • Advance transportation projects more prudently and leverage private and non-Federal investment by substituting the Administration's State Infrastructure Bank and Credit Enhancement proposals for the bill's current Innovative Infrastructure Finance provisions.

  • In addition, the Administration is concerned that the proposed Magnetic Levitation Transportation Technology Deployment Program does not adequately take into consideration evidence on the costs and benefits of projects that would be eligible under the program.