Legislative Update Chris Hundt Michigan Department of Transportation July 15, 2011.
-
Upload
priscilla-andra-walker -
Category
Documents
-
view
233 -
download
0
Transcript of Legislative Update Chris Hundt Michigan Department of Transportation July 15, 2011.
Legislative Update
Chris Hundt
Michigan Department of Transportation
July 15, 2011
July 15, 2011
Overview
• State Issues– Fiscal & political
environment
• Federal Issues– Fiscal & political
environment
– Reauthorization proposals
State Transportation Revenue
$1.70
$1.80
$1.90
$2.00
$2.10
Bill
ion
s
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
Down $224 Million Since 2004
MDOT Match Issue
FY 2012-15 Annual Shortfall
State Revenue Shortfall $120-$160 million/yr
Federal Aid Lost to MDOT
Highway Capital Program$700 - $800 million/yr
Match Problems Not Exclusive to MDOT
“Sadly, there are county road commissions in Michigan that are being forced to turn down millions of dollars in federal road funds for which they are eligible, because they simply cannot provide the required local match.”
Michigan’s Roads in Crisis – Highway, Roads and Bridges CAC Report July 2008
MDOT Reinvented
• 15% reduction in staff since 2009
• Closing or consolidating eight facilities
• Organizational changes and process improvements
• Debt restructuring
Better, faster, cheaper, safer, smarter
Legislative Activity
• FY 2012 state budget
• NITC
• Match Issue– SB 351/HB 4521 – sales tax diversion
• Consolidation of government services
Other Planned Legislative Activity
Special message to the legislature on infrastructure in October
• Transportation funding continues to be inadequate for state’s needs
• Structural problem that directly affects Michigan’s economic vitality
• Permanent solution for matching federal transportation funding is needed
Recalls Add Uncertainty
• Approved recall language– Representatives Damrow, Johnson, Jenkins,
Potvin, Pscholka, and Speaker Bolger– Senators Booher, Emmons, Green, Jansen,
Marleau, Nofs, and Major Leader Richardville
• Awaiting clarity hearing– Representatives Cotter, Jacobsen, Scott,
Shirkey– Senators Caswell, Kahn, Meekhof, Moolnaar,
Proos, Schuitmaker, Warren
Federal Reauthorization 2011
• SAFETEA-LU extended through 9/30/11– Originally expired 9/30/09
– Currently on 7th extension
History of Overdue Bills
37
98
275
79
252
680
0
200
400
600
800
STAA 7
8
STAA 8
2
STURAA 8
7
ISTEA
TEA-21
SAFETEA-L
U
Number of Days Authorizing Legislation Was Overdue
Recap of Key Milestones
• August 2005 – SAFETEA-LU signed• September 2008 - $8.017 B GF to HTF transfer• August 2009 - $7 B GF to HTF transfer• September 2009 – SAFETEA-LU expires• March 2010 – HTF shuts down for two days• March 2010 - $19 B transferred from GF to HTF• September 2011 – 7th extension of SAFETEA-
LU expires
Federal Fiscal Environment
HTF is Broke
-$80
-$60
-$40
-$20
$0
$20
$40
$60
2007
2009
2011
2013
2015
2017
Bill
ion
s
Revenue Outlays Ending Balance
Federal Fiscal Environment
• Little/no apparent support for increasing user fees
Infrastructure Needs Are Dramatic
$262
$214$189$194
$172
$134
0
50
100
150
200
250
300
C & P FinancingCommission
PolicyCommission
C&P FinancingCommission
PolicyCommission
20
08
$ i
n B
illi
on
s
Source: Report of the National Surface Transportation Infrastructure Financing Commission
Maintain Scenario Improve Scenario
Infrastructure Needs Dramatic in Michigan
Business as Usual
Estimated System
% of Needs Met
MI Transportation Plan
$37 billion $81 billion 46%
TF2 $2.3 billion $7.2 billion 32%
Administration’s Proposal
• Obama Administration released broad outline of reauthorization in February– $551 billion over six years (2012-17)
• This includes $50 billion in up front funding
– Assumes $231 billion in new revenue
Administration’s Proposal
SAFETEA-LU Admin Proposal
Percent Increase
Highways $228 B $336 B 48%
Transit $53 B $119 B 126%
Safety $7 B $12 B 87%
Rail - $53 B -
Infrastructure Bank
- $30 B -
Total $286 B $551 B 93%
Administration also proposed one-time funding of $2 billion for TIGER grants and $3 billion for airports
• Significant program consolidation to result in:– 6 highway programs
– 6 transit programs
– 2 rail programs
• Expands HTF to TTF and include passenger rail
Administration’s Proposal
Administration’s Highway Proposal
2012-17 Annual Avg.
National Highway $253.3 $37.6*
Safety $17.5 $2.9
Livable Communities $27.5 $4.6
Research, Tech, and Ed. $4.5 $0.8
Federal Allocation $8.9 $1.5
Transportation Leadership $17.1 $2.9
TOTAL $328.9 $50.2
(Billions)
Administration’s Transit Proposal
2012-17 Annual Avg.
Formula Grants $43.1 $7.2*
Bus & Rail State of Good Repair $28.0 $4.7*
Expansion & Livable Communities $19.6 $3.3*
Research & Technology Deployment $1.2 $0.2
Transportation Leadership $14.7 $2.4
Operations & Safety $1.1 $0.2
TOTAL $107.7 $17.9
(Billions)
Proposed Planning Changes
?
House Rule Change
• House procedural rules• “Cut-as-you-go” instead of
PAYGO
• Easier to reduce transportation spending
• More difficult to increase revenue
• Impact on firewalls and funding guarantees
House Budget Resolution
• Fiscal year 2012 budget resolution calls for big cuts• $30B per year from transportation
• Does not allow for a “reserve fund” to bring in additional revenue for reauthorization
House Reauthorization Proposal
• Chairman Mica’s priorities:– Stabilizing the HTF (spending w/in its means)
• $230 billion over six years
– Reform federal program– Increase flexibility and accountability– Maximize private funds leveraged– Accelerate project delivery – 437 day plan
Senate Activity• Agreement among transportation leaders
– Fund program at current levels– Eliminate earmarks– Consolidate programs– Strengthen TIFIA– Expedite project delivery
• Likely to be a two year bill
Alternative Scenarios
HTF Investments in Highways, Transit, and Safety
Six Year Total
(2012- 2017)
Annual
Average
Administration Proposal $467 billion $77.8 billion
Senate Transportation Leaders (current funding)
$339 billion $56.5 billion
House Budget Resolution $230 billion $38.3 billion
Immediate Concern is FY 2012
• House budget and reauthorization plan could:– Reduce highway program by 30%– Eliminate transit new starts– Cut funding for Amtrak
• Impact to Michigan’s highway funding depends on where reductions are made, but estimated reduction ranges from $175 million to $360 million per year
Other Complicating Factors
• Congress has not been willing to juggle transportation with other priorities– Federal budget deficit– Trade Deals & TAA– Appropriation bills
Questions?