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Infrastructure Featured in State of Union, House Hearing

February 14, 2013

By Oliver Patton

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Infrastructure had its moment in the spotlight this week as President Obama called for most-needed repairs funded in part by private investment, and the lead transportation committee in the House kicked off what will be a two-year effort to reauthorize the federal highway program.

In his State of the Union address on Tuesday evening, Obama said that reinvestment in infrastructure will make the country more competitive and, not incidentally, create more jobs.

“Tonight I propose a “Fix-It-First” program to put people to work as soon as possible on our most urgent repairs, like the nearly 70,000 structurally deficient bridges across the country,” he said.

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“And to make sure taxpayers don’t shoulder the whole burden, I’m also proposing a Partnership to Rebuild America that attracts private capital to upgrade what our businesses need most: modern ports to move our goods; modern pipelines to withstand a storm; modern schools worthy of our children.”

Although he acknowledged the role of taxes in paying for infrastructure, Obama did not explicitly call for increases. But witnesses at the House Transportation and Infrastructure Committee hearing yesterday took up the slack.

“It’s a difficult time to consider taxes, but we have to fund transportation,” said Ed Rendell, the former Pennsylvania governor who now co-chairs the action group Build for America that is calling for substantial new investment.

Rendell told the committee that short-term fuel tax increases should be part of an overall funding package that includes a national infrastructure bank and an easing of restraints on tolling.

The U.S. Chamber of Commerce, which represents the views of the business community, is solidly behind a fuel tax increase, said president and CEO Thomas Donohue.

“The Chamber supports reasonable increases that are phased in and indexed to inflation,” Donohue said.

The fuel tax is a user fee so shippers can get their goods to customers in a timely way, and it is insane to consider today’s highway congestion a cost of doing business, he said.

Asked by Rep. Nick Rahall, D-W.Va., if groups like the Chamber should help build support for a fuel tax hike, Donohue replied, “We’ll raise a lot of noise but maybe Congress could say nothing instead of saying hell no.”

Terrence O’Sullivan, general president of the Laborers’ International Union of North America, continued the theme, saying that his group supports user fees and more use of public-private partnerships.

Rep. Bill Shuster, R-Pa., the chair of the committee, said that while the panel must tend to water resources and passenger rail legislation it also is beginning work on highway reauthorization.

He said Rep. John Duncan, R-Tenn., will chair a panel on intermodalism and freight movement that will make recommendations on legislative language for the reauthorization.

Shuster had to take a moment to apologize at the start of the hearing for remarks about President Obama’s State of the Union address.

Obama said: “Ask any CEO where they’d rather locate and hire, a country with deteriorating roads and bridges or one with high-speed rail and Internet, high-tech schools, self-healing power grids.”

Asked by Politico for his reaction, Shuster said, “I think he’s lying about CEOs – they want to invest in a country that has high-speed rail? Really? Tell me what CEO said that.”

Shuster opened yesterday’s hearing with an apology. “I do not think the president is a liar,” he said, adding that while he disagrees with the president on high-speed rail this type of rhetoric is not his style.

The other themes, besides the need for more revenue, that emerged at the hearing were the need for a strong federal role in transportation, and for improvements in the administration of governance.

Rendell, Donohue and O’Sullivan told Rahall that they favor a federal presence over devolution of money and authority to the states.

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