Testimony: Representative Oberstar, with Representative Wise, proposed a capital budget pilot program. The Congressmen requested that the Commission include three recommendations in its report: 1) the FY 2001 budget should include a capital budget pilot program; 2) the pilot program should display infrastructure and Federal buildings in the form of a capital budget; and 3) there should be an analysis of the effect of the pilot program on the current budgetary process, macroeconomic stability and growth, and budgetary choices. The Congressmen advised the Commission to develop a model for the pilot program in support of these recommendations.

In his oral testimony, Representative Oberstar discussed the following issues:

• borrowing to finance physical infrastructure investments, because both present and future generations pay for them and benefit from them;
• the need for a capital budget to make rational investment decisions before lagging further behind Japan, Germany, and France; and
• the need for increased investments in the nation's aging infrastructure, because dedicated revenue sources, such as the highway trust fund, are not dedicated to infrastructure investments, but rather held to cover the unified budget deficit.

Q.    Would it be appropriate to have target levels for investments extending into the future?
A.    Once you establish a capital budget, you can have an investment portfolio and prioritize investments.

Q.    If we undertake an extensive capital program, we lock in expenditures for a period of time. Do we increase the goals of the budget under this circumstance?
A.    No, you don't lock in an uncontrollable part of the budget. Decisions today may result in illuminating a long-term spend out program. It's not a matter of locking in, but setting up a process where a "short-term" group of people take a longer-term look at investment.

Q.    Under your pilot program, would authorizing committees decide which projects to undertake or would the projects have to be appropriated as well?
A.    In most cases you still have to appropriate.

Q.    How would the size of the capital budget be determined? In relation to what?
A.    That is the fundamental issue of establishing a forum for the debate.

Q.    Would Congress allow some kind of a commission to make capital budgeting decisions?
A.    It should be part of a public policy debate.