WASHINGTON, August 5, 2015 – Hope is growing that Congress will finally pass a long-term highway bill this year to guarantee funding for road and bridge construction.
Senate and House leaders still don’t agree on to how to fund a long-term bill, and an increase in the gas tax seems to be off the table. But leaders on both sides of the Hill now say it’s a priority to get a long-term bill done this fall. If they don’t reach a deal by the end of the year, the issue would likely get shuffled aside in election-year politics in 2016. That means a new long-term bill would likely get pushed off to 2017, when there will be a new president and Congress.
The Senate passed a six-year bill last week, and President Obama signed into a law a three-month funding extension to Oct. 29, giving House leaders time to advance a long-term bill this fall. Funding had been scheduled to run out July 31 under the last short-term extension.
“I have a moderate degree of optimism that we’ll get a bill passed by the end of this calendar year,” Mike Steenhoek, executive director of the Soy Transportation Coalition, told Agri-Pulse on the sidelines of this week’s 2015 Agriculture Transportation Summit in Rosemont, Ill. “There is this increasing acknowledgment that if we allow this thing to extend into 2016 that is almost tantamount to just putting it to 2017.”
Bud Wright, executive director of the American Association of State Highway and Transportation Officials, said the “potential for a long-term authorization is encouraging.”
The chairman of the House Transportation and Infrastructure Committee, Bill Shuster, R-Pa., said the extension allows the House “time to put forward a fiscally responsible long-term surface transportation proposal when Congress returns and then go to conference with the Senate.”
Obama used the signing of the Oct. 29 extension to put the heat on congressional Republicans.
“I guarantee you this is not how China, Germany, other countries around the world -- other big, powerful countries around the world handle their infrastructure. We can’t have bridges collapsing and potholes not being filled because Congress can’t come up with an adequate plan to fund our infrastructure budget for more than three or five or six months at a time.”
How to fund the bill isn’t the only area of disagreement. The Export-Import Bank also is emerging as an issue. The bank’s authority lapsed June 30, but the Senate voted 64-29 to approve an Ex-Im reauthorization amendment to the highway measure. Conservative groups such as Heritage Action are pushing to kill the bank, and they have broad support among House Republicans, including the chairman of the House Financial Services Committee, Jeb Hensarling of Texas.
The bank has also helped finance some sales of agricultural equipment and commodities.
Walter Kemmsies, chief economist for the port engineering firm Moffatt & Nichol, told the transportation summit that the bank’s reauthorization shouldn’t be that controversial. “The bottom line is it works,” he said. “We should try to improve it, but not get rid of it.”
In other news from the summit:
Prospects dim for bigger truck sizes: The Soy Transportation Coalition, among other interests, want to use the highway bill to increase the size limit for interstate trucks. An Informa Economics study for the coalition found that six-axle, 97,000-pound trucks would be just as safe as five-axle, 80,000-pound semis, but larger trucks would cut the number of truck trips needed to haul soybeans and soy products by 1.2 million a year, saving 5.5 million gallons of fuel.
Nevertheless, the higher limit didn’t get into the Senate bill due to opposition from the ranking Democrat on the Senate Environment and Public Works Committee, Barbara Boxer of California. EPW is one of three committees that share Senate jurisdiction for the bill. “It’s going to have to come from the House,” said Steenhoek.
The Senate bill does include a provision meant to address the shortage in drivers nationwide - a pilot program to allow truck drivers between 18 to 21 years old to cross state lines. Many states now allow truck drivers as young as 18, but under current law they have to be at least 21 years old to cross between states. Under the bill, an under-21 trucker could drive up to 100 miles into a neighboring state that participates in the pilot project.
The Senate bill also would authorize a new formula-based, $2.2 billion-a-year national freight program to create a nationwide strategic plan and help fund state infrastructure projects.
‘Stunning turnaround’ seen in rail service: A member of the Surface Transportation Board says the railroads have pulled off a “stunning turnaround” since the delays that plagued grain shippers after the 2013 harvest. “Railroads were not able to move goods quickly enough, and now railroads don’t have enough goods to move,” said Debra Miller, one of three STB members speaking at the Soy Transportation Summit.
Representatives of the major railroads say they’ve improved communication but continue to spend heavily on new track and equipment, raising shipping times. Shipping of agricultural commodities is also down somewhat this year, and coal shipments have fallen sharply because of reduced demand. The “resources have finally come in line with volume and expectations,” said Brad Yeatts, director of agriculture and consumer products for Norfolk Southern.
Panama Canal expansion eyed for Spring 2016: Expansion work on the Panama is more than 91 percent complete and on track for opening in the second quarter of 2016, likely April, says Javier Ho, a dry bulk shipping specialist with the Panama Canal Authority. The work includes building new entrances on both ends of the canal, replacing locks, deepening and widening the channels through Gatun Lake.
The expansion, which will allow bigger vessels to use the canal, should lower the cost of shipping grain and soybeans, Ho said. The ocean shipping cost of transporting a ton of soybeans from eastern Iowa via the Gulf to Japan would drop from $30.69 to $21.43 a metric ton, using the larger vessel, according to data he presented at the transportation summit. That’s less than the estimated $22.11-per-ton cost for the barge segment of the journey.
Agricultural shipping has been on the rise. A record 48.6 million tons of grains and oilseeds were shipped through the canal in 2014 and that record is likely to be broken this year, he said.
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