[Senate Hearing 111-1227]
[From the U.S. Government Publishing Office]





                                                       S. Hrg. 111-1227

                    THE IMPORTANCE OF TRANSPORTATION
                  INVESTMENTS TO THE NATIONAL ECONOMY
                                AND JOBS

=======================================================================

                                HEARING

                               before the

                              COMMITTEE ON
                      ENVIRONMENT AND PUBLIC WORKS
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 3, 2010

                               __________

  Printed for the use of the Committee on Environment and Public Works



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               COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS

                     ONE HUNDRED ELEVENTH CONGRESS
                             SECOND SESSION

                  BARBARA BOXER, California, Chairman
MAX BAUCUS, Montana                  JAMES M. INHOFE, Oklahoma
THOMAS R. CARPER, Delaware           GEORGE V. VOINOVICH, Ohio
FRANK R. LAUTENBERG, New Jersey      DAVID VITTER, Louisiana
BENJAMIN L. CARDIN, Maryland         JOHN BARRASSO, Wyoming
BERNARD SANDERS, Vermont             MIKE CRAPO, Idaho
AMY KLOBUCHAR, Minnesota             CHRISTOPHER S. BOND, Missouri
SHELDON WHITEHOUSE, Rhode Island     LAMAR ALEXANDER, Tennessee
TOM UDALL, New Mexico
JEFF MERKLEY, Oregon
KIRSTEN GILLIBRAND, New York
ARLEN SPECTER, Pennsylvania

                    Bettina Poirier, Staff Director
                 Ruth Van Mark, Minority Staff Director
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                 
                            C O N T E N T S

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                                                                   Page

                             MARCH 3, 2010
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     2
Cardin, Hon. Benjamin L., U.S. Senator from the State of Maryland     4
Bond, Hon. Christopher S., U.S. Senator from the State of 
  Missouri.......................................................     7
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....    10
Voinovich, Hon. George V., U.S. Senator from the State of Ohio...   100

                               WITNESSES

Rahn, Pete K., Director, Missouri Department of Transportation, 
  on behalf of the American Association of State Highway and 
  Transportation Officials.......................................    11
    Prepared statement...........................................    13
    Response to an additional question from Senator Vitter.......    62
Buechner, William R., Vice President, Economics and Research, 
  American Road and Transportation Builders Association..........    63
    Prepared statement...........................................    65
    Responses to additional questions from Senator Vitter........    83
Poupore, Raymond J., Executive Vice President, National 
  Construction Alliance II.......................................    86
    Prepared statement...........................................    88
Foss, Tom, President and Chief Operating Officer, Griffith 
  Company, on behalf of the Associated General Contractors of 
  America........................................................    92
    Prepared statement...........................................    94
 
 THE IMPORTANCE OF TRANSPORTATION INVESTMENTS TO THE NATIONAL ECONOMY 
                                AND JOBS

                              ----------                              


                        WEDNESDAY, MARCH 3, 2010

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The full Committee met, pursuant to notice, at 10:05 a.m. 
in room 406, Dirksen Senate Office Building, Hon. Barbara Boxer 
(chairman of the full Committee) presiding.
    Present: Senators Boxer, Inhofe, Bond, Voinovich, Cardin, 
Whitehouse, Klobuchar, and Merkley.

           OPENING STATEMENT OF HON. BARBARA BOXER, 
           U.S. SENATOR FROM THE STATE OF CALIFORNIA

    Senator Boxer. Good morning, everybody, and thank you so 
much for being here.
    This is the first in a series of hearings to spotlight 
important areas of focus in the process of authorizing surface 
transportation programs. Today's hearing will examine the ways 
transportation investment creates and preserves jobs and 
increases America's economic competitiveness.
    We know transportation infrastructure investment is a 
proven jobs creator. According to the DOT, every $1 billion in 
Federal funds for transportation that is matched by State and 
local funds supports 34,700 jobs. According to a recent report 
by the American Association of State Highway and Transportation 
Officials, AASHTO, more than 280,000 direct jobs have been 
created or sustained at projects across the country as a result 
of the highway and transit funding in the American Recovery and 
Reinvestment Act.
    On February 19th Transportation Secretary LaHood and I 
toured a facility in Los Angeles where workers are providing 
preventive maintenance service to city buses through L.A. 
Metro's Bus Mid-Life Program, replacing engines and fuel 
cylinders, refurbishing interiors and wheelchair lifts, and 
repainting older buses to improve their safety, performance and 
reliability.
    A Federal investment of $47 million under ARRA is giving 
these buses a new lease on life, and it is keeping 97 workers 
on the job. These workers and their families and thousands like 
them across the country are the real beneficiaries of Federal 
investments that are putting Americans back to work, 
strengthening our economy, and rebuilding the infrastructure 
that keeps our country moving.
    Transportation investments not only create and sustain jobs 
in the short term; they help us with economic recovery. They 
also provide benefits to America's families and businesses 
every day, including shortened travel and commuting times, 
increased productivity, and improved safety. Infrastructure 
investments also enhance the productivity of business and 
individuals by reducing disruptions that waste money, time and 
fuel and undermine our competitiveness.
    In the coming weeks, we will be considering many important 
aspects of the surface transportation authorization, including, 
among other topics, Federal, State and local partnerships to 
accelerate transportation benefits, mobility and congestion in 
urban and rural America, and transportation's impact on the 
environment.
    The next highway transit and highway safety authorization 
provides an opportunity to take a fresh look at these programs 
and make the changes necessary to ensure our transportation 
system will meet America's needs in the coming years. At the 
end of the day, it is a matter of setting the right priorities 
and crafting innovative and effective means to address them.
    As the Chairman of this Committee, I want to acknowledge 
the bipartisan support that I have received in this whole area 
of transportation and infrastructure. It really warms my heart 
because, as we know, it is hard to find those areas of 
agreement these days, but this is one area where there has been 
much agreement.
    I also want to say that I am encouraged that the House is 
taking up the reauthorization of this SAFETEA-LU bill on 
Thursday under suspension of the rules. And if we can get two-
thirds vote, then we put this whole thing to bed, this 1-year 
extension, which will give certainty to all of our States. If 
they don't get the votes under suspension of the rules, we have 
other ways. They can go issue a rule and go the regular route, 
but we are hopeful, and we could use all the help that we can 
get here from Members of the Senate calling our colleagues over 
there, and of course outside groups as well. And we can get 
that to bed, then we can fully concentrate on the 
reauthorization, and this is my hope.
    So job creation is my top priority, and I am grateful, 
again, to colleagues on both sides of the aisle for their great 
interest in moving forward together on a transformational 
transportation bill that makes the investments necessary to 
ensure our long-term prosperity.
    And with that, I will call on Senator Inhofe, the Ranking 
Member.

          OPENING STATEMENT OF HON. JAMES M. INHOFE, 
            U.S. SENATOR FROM THE STATE OF OKLAHOMA

    Senator Inhofe. Thank you, Madam Chairman.
    And you know, what she says is right. We sometimes disagree 
on other issues in this Committee. This Committee has such an 
incredible jurisdiction. It has the largest jurisdiction of any 
Committee in the U.S. Senate. It takes two Committees in the 
House to do what we have in our jurisdiction, so there are 
areas of disagreement.
    This area, and I am proud to say that as someone who just 5 
days ago was--the National Journal said I was the most 
conservative and rated me No. 1 and the most conservative one, 
and yet I tell them hastily that in a couple of areas--national 
defense and infrastructure--I am a big spender. That is what we 
are supposed be doing here.
    Now, I had an opening statement I was going to give because 
I didn't know we would be able to get to the point last night 
that we got, so I feel a little better. We have in the audience 
today Gary Ridley. He has testified before this Committee, 
Madam Chairman. He is our Transportation Secretary in Oklahoma.
    Stand up, Gary. I know Pete is a good friend of yours, and 
you work together. And if you were on the panel, I would have 
you tell us what a crisis we would have in Oklahoma if we 
hadn't been able to do what we did last night.
    Now, what the Chairman says is right. We need to take care 
of this thing. We did pass legislation out of here, and it 
would save us a lot of money, and we would be able to plan in 
advance.
    Those of us who came here with a business background, it is 
mind boggling when you are doing something where you are 
dealing 1 month at a time, and we can put a price tag on that, 
on what it costs us each month that we are doing it this way. 
So I agree with you, Madam Chairman. I am hoping that we will 
be able to get this adopted.
    I can remember when we did the last major bill in 2005. It 
was very successful, but that was a $286.4 billion bill. That 
didn't really take care of the maintenance of what we have 
right now. That is why I think this Committee--and I know that 
most of the Members on this Committee agree with this--we have 
to give a higher priority to this.
    So while we escaped a crisis, at least in my State of 
Oklahoma and I suggest in most other States last night, we 
still need to do a better job, and that is what we are going to 
be doing.
    So thank you, Madam Chair.
    [The prepared statement of Senator Inhofe follows:]

                  Statement of Hon. James M. Inhofe, 
                U.S. Senator from the State of Oklahoma

    I am relieved the Senate was able to work out a deal last 
night on the 30-day extension of the highway program. However, 
this is in no way a victory. This simply means that we will go 
back to the highway program being funded $1 billion a month 
lower than 2009 levels and living with the uncertainty of 
short-term extension. In fact, the States won't receive the new 
funding provided by this extension for close to a month--just 
when this extension is expiring. The House needs to move and 
pass the long-term extension the Senate sent over last week.
    Before I get into today's hearing, I want to thank my good 
friend Gary Ridley, who is Oklahoma's Transportation Secretary, 
for coming out to Washington to help resolve this crisis. Gary 
is an asset to both Oklahoma and the Nation.
    There has been a lot of discussion recently about the 
impacts of infrastructure investment on the economy, so I thank 
the Chairman for having this hearing to clarify some 
misconceptions. For years I have been leading the fight in 
Washington for increased investment in transportation and 
infrastructure because I believe strongly that no other form of 
Government spending is as beneficial to our citizens and the 
economy as infrastructure investment.
    There is an undeniable link between a robust economy and 
strong transportation infrastructure investment. Yet when it 
comes to other Federal spending needs, transportation is often 
neglected as a priority--one only needs to look at the so-
called ``stimulus'' bill to see evidence of this.
    Despite the relatively small amount of highway investment 
in the stimulus bill, it is evident that highway investment is 
a proven job creator--much more so than any of the other of the 
Administration's so-called ``stimulus'' initiatives. Although I 
support increased infrastructure investment in any form, it is 
important to note that supplemental highway funding in the so-
called ``jobs bill'' is in no way a substitute for the short- 
and long-term economic necessity of a multi-year highway bill 
re-authorization.
    As an author of SAFETEA in 2005, I know first-hand that 
infrastructure spending from a new highway bill is one of the 
most proven ways to stimulate the economy and create jobs. 
However, when we look at the benefits of infrastructure 
spending, we often focus solely on the immediate employment and 
economic benefits, which is only part of the story. The 
greatest impact is over the long run--when the new roads and 
bridges add to productivity by improving mobility. I believe 
one of the most overlooked aspects of the post-World War II 
prosperity was the creation of the interstate highway system.
    We simply can't continue to ignore the infrastructure 
crisis in this country. The Department of Transportation has 
estimated that the maintenance backlog on our Nation's roads 
and bridges exceeds $600 billion. I have often said that, 
despite its large size, SAFETEA didn't even maintain the system 
we have. The previous estimate was just $500 billion--in other 
words, increases in the costs of steel, cement and higher 
wages, combined with chronic underinvestment, have put us into 
an even deeper hole.
    We learned in many of our previous hearings that if we 
don't take dramatic action, growing congestion and 
deteriorating pavement conditions will choke the U.S. economy. 
It is understandable in these dire economic times to measure 
investment decisions based on immediate results, but if we are 
going to continue to be the leader in the global economy, we 
need to take a much more strategic approach. We can no longer 
rely on transportation infrastructure investments made a 
generation ago.
    As the rest of the world continues to finance new ports, 
highways, and sophisticated rail networks to attract new 
commerce, we are falling far behind, and our underinvestment 
means that our domestic industries are operating globally at a 
competitive disadvantage. If we fail to provide a free flowing 
transportation system to accommodate the needs of our economy, 
our manufacturing industries will be forced to export their 
operations abroad.
    I welcome our witnesses, and I look forward to hearing 
about their first-hand accounts of infrastructure investment's 
impact on the economy as well as the consequences of continued 
underinvestment.

    Senator Boxer. Thank you, and I agree with everything you 
said.
    Senator Cardin.

         OPENING STATEMENT OF HON. BENJAMIN L. CARDIN, 
            U.S. SENATOR FROM THE STATE OF MARYLAND

    Senator Cardin. Well, Madam Chair, first let me give you 
some good news. The snow is melting. Spring is around the 
corner, and the construction season will be beginning soon in 
earnest. So this hearing is particularly timely for this 
Committee to exercise its responsibility to make sure that we 
have the surface transportation authorizations necessary for 
the infrastructure of America and the growth of America.
    So I thank you for holding this hearing, and I thank the 
witnesses that are here to help us as we start this journey to 
enact the next authorization for surface transportation.
    I need to, though, start by what happened this week, where 
we saw the vulnerability in a lapse in the highway program. 
That had immediate impact, and I think we need to underscore 
that because before we look at reauthorization we have to make 
sure that there is no gap.
    Let me, if I might, just quote from two people who talked 
about the impact of one Senator blocking the short-term 
reauthorization, or short-term continuation. John Horsley, 
President of the American Association of State Highway and 
Transportation Officials, said in response to the block on the 
extension, ``It will have a ripple effect throughout the whole 
construction world. The jobs we are trying to create through 
the stimulus programs are going to be undercut by cancellations 
of contracts. There is a consequence in the real world.''
    William Millar, President of the American Public Transit 
Association said, ``Letting Federal funding for transportation 
programs expire at a time when jobs are a national priority is 
unthinkable.''
    I say that first because we were successful last night in 
getting an extension done, and the Chairman is expressing 
optimism that we can get the extension through the end of the 
year. It is critically important that we have no more lapses in 
our transportation authorization programs so that we can 
continue this.
    And while trust fund extensions are essential for the time 
being, all of these SAFETEA-LU 2005 projects and intermediate 
ready-to-go projects are nearly complete, and it is time for 
new project authorizations.
    While our next transportation bill reauthorization could 
result in landmark achievements in pavements like the 
Appalachia Development Highway System, which is critically 
important to the people of Maryland, it is time to increase 
development in transit systems, multi-modal infrastructure and 
smart growth transportation projects that emphasize 
sustainability and livability.
    The benefits of these types of projects are many, not the 
least of which are jobs associated with transit and smart 
growth projects. Building transit systems and retrofitting 
community transportation infrastructure will be efficient, 
multi-modal transportation systems and create traditional hard 
hat and engineering jobs, just like roads and highway projects.
    The American Public Transit Association estimates that for 
every $1 billion invested in transit, it yields 30,000 jobs. 
This includes jobs in bus and rail car manufacturing, an 
industry that is very important in America; a variety of high 
tech, high paying jobs in software development and design 
computer programs for logistics management, fare collection and 
safety and security management; the design, procurement and 
installation of computer systems to operate these programs, not 
to mention the permanent transit operators that are created 
when we expand our transit system.
    It is lasting jobs that are worth the most to our 
communities around the Nation. Transit and increased efficiency 
in community transportation systems foster increased economic 
development and increase property values.
    I am encouraged by President Obama and Secretary LaHood's 
recognition of how sustainability and livability and 
transportation design play in not only protecting the 
environment, but also creating economic sustainability for our 
Nation's communities.
    So Madam Chair, as we start this process of looking at how 
we are going to deal with the next chapter in our surface 
transportation, I hope we will take advantage of this to focus 
on where we can create jobs, create the type of infrastructure, 
but also create the livable communities that are so important 
to Americans.
    And with that, I look forward to hearing from our 
witnesses.
    [The prepared statement of Senator Cardin follows:]

                 Statement of Hon. Benjamin L. Cardin, 
                U.S. Senator from the State of Maryland

    Thank you, Madam Chairman, for holding this hearing this 
morning.
    As the snow in the region and across the country begins to 
melt and with spring just weeks away, State DOTs around the 
country are preparing for the 2010 construction season. As 
authorizers of Federal funds for surface transportation 
projects it is time we get down to work and deliver the means 
for our States and counties to get working on the next phase of 
transportation projects for our States and regions.
    However, before discussing the importance of new road and 
transit construction projects we must continue to address the 
needs of our State and local Departments of Transportation. 
These agencies continue to make progress on existing road and 
highway projects using the critical Federal funding we have 
provided by way of extending the surface transportation trust 
fund in lieu of full reauthorization.
    Yet with complete disregard for the needs of the States and 
the pay checks of thousands of highway construction workers, we 
saw the ability of one Senator to single handedly halt this 
progress.
    John Hoarsely, President of the American Association of 
State Highway and Transportation Officials (AASHTO), said in 
response to the block on the extension, ``It'll have a ripple 
effect throughout the whole construction world . . . The jobs 
we are trying to create through the stimulus programs are going 
to be undercut by cancellations of contracts . . . There is a 
consequence in the real world.''
    William Millar, President of the American Public Transit 
Association, said, ``Letting Federal funding for transportation 
programs expire, at a time when jobs are a national priority, 
is unthinkable.''
    I am glad we were finally able to pass a short-term 
extension of our highway program. At the same time, I am 
encouraged that this Committee is focusing attention on the 
reauthorization of SAFETEA-LU, because there is terrific 
promise in the jobs we will create by authorizing new 
transportation projects across the country.
    While trust fund extensions are essential for the time 
being, all of the SAFETEA-LU 2005 projects and intermediate 
``ready to go'' projects are nearly complete, and it is time 
for new project authorizations.
    Our next transportation bill reauthorization could result 
in landmark achievements in pavement--like the completion of 
the Appalachian Development Highway System. It is time to look 
toward increased development of transit systems, multi-modal 
infrastructure and smart growth transportation projects that 
emphasize sustainability and livability. The benefits of these 
types of projects are many, not the least of which are the jobs 
associated with transit and smart growth projects.
    Building transit systems and retrofitting community 
transportation infrastructure with efficient multi-modal 
transport systems create traditional hard-hat and engineering 
jobs just like road and highway projects.
    The American Public Transit Association estimates that 
every billion dollars invested in transit yields 30,000 jobs. 
This includes jobs in:
     Bus and rail car manufacturing;
     A variety of high tech, high paying jobs in software 
development to design computer programs for logistics 
management, fare collection, and safety and security 
management;
     Design, procurement and installation of the computer 
systems to operate these programs;
     Not to mention the permanent transit operations jobs that 
are sustained long after a transit project is completed.
    It's lasting jobs that are worth the most to communities 
around the Nation. Transit and increased efficiency in 
community transportation systems foster increased economic 
development and increased property values.
    I am encouraged by President Obama and Secretary LaHood's 
recognition of how sustainability and livability in 
transportation design play in not only protecting the 
environment but also in creating economic sustainability for 
our Nation's communities.
    I look forward to the testimony of our witnesses. Thank 
you, Madam Chairman.

    Senator Boxer. Thank you.
    Before I call on Senator Bond, Senator Inhofe wanted to 
take the remainder of his time because he has a couple of 
minutes remaining.
    Senator Inhofe. Very brief. I was reminded by my staff that 
while I was ad-libbing my opening statement, I left out 
something that was significant that we want to make sure, so 
let me just go ahead and put this paragraph in.
    I am relieved, as I have said, the Senate was able to work 
out a deal last night on a 30-day extension on the highway 
program, but this is no way to victory. This simply means that 
we will go back to the highway program being funded at $1 
billion a month--$1 billion a month lower than 2009 levels, and 
living with the uncertainty of short-term extensions, which I 
think I implied that.
    In fact, the States won't receive the new funding provided 
by this extension for close to a month, just when this 
extension is expiring. The House needs to move and pass the 
long-term extension of the Senate bill, as we have said, and I 
think that is right.
    The figure that I have from Gary Ridley, Madam Chairman, is 
that just in our State of Oklahoma, by doing this on this 30-
day extension thing as opposed to the long-term extension, it 
is costing us $160 million over this period of 12 months in my 
State of Oklahoma. And I would hope that during the opening 
statement of Mr. Rahn that you would kind of share with us what 
it is doing in the State of Missouri.
    Thank you, Madam Chair.
    Senator Boxer. Well, Senator, now that you have put this 
out so forcefully, I just hope the message gets to the House 
Democrats and Republicans. Pass this bill under suspension on 
Thursday, please. Please put this behind us because these 
delays are really hurting our people back home, all of us, 
every one of us, no more than Missouri.
    So I would like to call on Senator Bond.

        OPENING STATEMENT OF HON. CHRISTOPHER S. BOND, 
            U.S. SENATOR FROM THE STATE OF MISSOURI

    Senator Bond. Thank you, Madam Chair and Senator Inhofe. 
The hearing is a great opportunity not only to examine the link 
between infrastructure spending and job creation, but also to 
understand how transportation policy can help rebuild our 
economy.
    I personally was very disappointed that the huge stimulus 
bill that was passed last year spent an appallingly small 
amount on highways and transportation. To me, and I think to 
some of my highway friends in Missouri, it was a great 
opportunity that we whiffed. It would have put a lot more 
people to work. It would have done a lot more for the economy 
and had lasting impact.
    But I thank the witnesses for coming. Your perspectives are 
important. We need to hear from you what is going on in the 
States and get a better understanding on what we can do at the 
Federal level.
    A very special, warm welcome to my old friend, Pete Rahn, 
while he is here on behalf of AASHTO. As has been mentioned 
several times, he is the Director of Missouri Department of 
Transportation, and I would say on his behalf that he is a 
popular DOT Director. There have been some in the past who 
refused to listen to the people. I found as I traveled the 
State prior to Pete's assuming this position that people were 
terribly frustrated that the highway priorities were not being 
developed at the local level, and Pete has avoided a whole lot 
of problems others had by listening. It is amazing how much you 
can hear when you listen. I think Yogi Berra may have said 
that.
    But he has a mantle full of awards for his notable service, 
and he is here with some good information. As a self-described 
infrastructure conservative, I, like Senator Inhofe, am a big 
spender when it comes to fulfilling our major responsibilities 
in defense and transportation.
    And we know that every billion dollars will generate some 
30,000 to 40,000 jobs for every billion spent. But it also 
leads to the development of our States. When I was Governor, I 
wanted to find out what were the keys to having a growing 
community, and it was very clear--if you had good highways, the 
town grew, jobs came, people were better off. And it makes a 
lasting impact, far beyond the immediate jobs it creates.
    AASHTO uses a term, ``economic benefit magnifier,'' and 
estimates an average economic benefit over $5 for every dollar 
spent, and I would not be surprised. When we build a new 
highway, provide access from point A to point B, we create 
communities where businesses will want to locate. We can build 
bridges and fund transit systems in the middle of nowhere and 
still create jobs, but we miss out on the jobs that should be 
created.
    Unfortunately, over the last year, instead of working 
toward a blueprint for our future for our Nation's aging 
transportation system, we spent all of our time dealing with 
the consequences of inaction. We need a blueprint for improving 
and investing in our Nation's transportation system, and 
tomorrow's priorities are the ones that will give us the best 
bang for our buck.
    Unfortunately, that is not where we are today. Here, we all 
agree on the economic benefit of infrastructure, but right now 
we are missing out on the full extent of those opportunities 
because we are operating off a bill that under-funds 
yesterday's priorities.
    This is why I truly hope, and maybe it is too late to have 
that hope, that we could do what we are supposed to do every 5 
years and have a real genuine authorization that looks forward 
5 years.
    Now, some people know the secret that this is my last year 
in the Senate, and I would love nothing better than to be able 
to work with my colleagues to frame the infrastructure 
development for the future, but we will take whatever we can 
get. That is why I was one who supported the bill, despite what 
were some very real partisan problems with the way it was 
structured.
    But we can't continue to delay these hard decisions. There 
are no easy solutions. But I think we get paid to make the 
tough decisions and try to lay out a plan for the future. It is 
time to do our job, move forward with a reauthorization bill, 
pass a blueprint that will move our transportation system 
forward, help our economy grow.
    I thank the Chair and the Ranking Member and our witnesses 
today for a very, very important message I am confident they 
will deliver.
    Thank you, Madam Chair.
    Senator Boxer. Senator Bond, you need to know that this is 
the point of the hearing. This is the first hearing on our way 
to markup. And I have been working closely with Senator Inhofe, 
Senator Voinovich, Members on my side, and our intention is to 
hold a series of hearings and then sit down and write the bill 
while you are still here, and while Senator Voinovich is still 
here. That is a commitment I make to you, and that is a pledge 
that I make to you. We do have to do this bill, and we are 
going to do it.
    And I also want to say that I agree with you that the 
stimulus bill did not have enough for infrastructure. As a 
matter of fact--although Senator Inhofe, I don't want to get 
him in any kind of trouble back home, opposed the stimulus 
bill, he worked with me, and we tried to triple the funding for 
infrastructure.
    I also want the record to show that we did succeed, 
Senator, in upping it to $48 billion. Plus we got more funding 
through the Build America Bond Program, which in California we 
issued billions of Build America bonds, which are also 
infrastructure and many States utilize them.
    There also was some money for TIGER grants, and in 
addition, $8 billion for high speed rail. It still, in the 
context of the large bill, was not enough, and I fully agree 
with you on that. And I fully agree that this bill that we 
write now for the next 5 years has to be robust, and it has to 
be clear that this is an economic driver for America.
    So I just want you to feel good about that. You will be 
part of what we are calling MAP-21, Moving Ahead for Progress 
in the 21st Century, and you and Senator Voinovich will be part 
of that.
    Senator Bond. Well, I like the MAP-21 team better than the 
LU bill that we had. I like that idea. I thank you and I 
really, I enjoyed working on the 2005 bill. I am sorry my loss 
of seniority knocked me out of the position, but I know that 
Senator Voinovich will do a good job, and I very, very much 
appreciate and thank you for making every effort to see if we 
can't go forward this year.
    Senator Boxer. We will.
    Senator Inhofe.
    Senator Inhofe. Let me just quickly respond to what you 
said.
    Yes, I did oppose the stimulus bill because it didn't 
stimulate. It is as simple as that. It had a total of 3 percent 
of the whole $787 billion that went to roads, highways, 
bridges. Now, and while it was an improvement to increase by 
the $48 billion, still that wasn't roads, highways and bridges. 
That was transportation, a lot of things that I probably would 
not have individually wanted.
    The amendment that we had would have tripled the amount of 
money that went to roads, highways, bridges and maintenance and 
construction. And of course, we lost that amendment, but we 
tried.
    Senator Boxer. OK. Now, I didn't want this to turn into an 
argument over the ARRA, but just let the record show that there 
is disagreement. We believe the tax cuts in that bill did 
stimulate the economy. We believe it has saved and created 
jobs. So let the record show there is a big disagreement on 
that.
    Where there is agreement is we all wanted more for 
highways, bridges, and yes, I did support transit, but I also 
supported the highways, bridges and roads.
    With that cleared up, we will call on Senator Klobuchar, 
and then we will get right to our panel.

           OPENING STATEMENT OF HON. AMY KLOBUCHAR, 
            U.S. SENATOR FROM THE STATE OF MINNESOTA

    Senator Klobuchar. Thank you very much, Madam Chair. Thank 
you for holding this hearing.
    Thank you, all of you, for being here.
    You know, I live six blocks from the bridge that fell down 
that August day in Minneapolis, an eight-lane highway right in 
the middle of the river. So I am reminded of the need for 
transportation investment literally every time I go home 
because any time I have to get to about three-fourths of the 
places I go, I drive over that new bridge, which is a beautiful 
new bridge. It got built in 9 months because there was a sense 
of urgency.
    Well, there is not always a sense of urgency of all the 
repairs that need to be made, as you all know, all around the 
country. And that was a national embarrassment and really a 
call to action for the people of this country.
    And it has been pointed out, and we will hear about today 
at this hearing, it is not just a safety issue to invest in our 
infrastructure. It is also an economic issue.
    The direct link between transportation investments and job 
creation is clear. The Federal Highway Administration estimates 
that every $1 billion of highway spending creates roughly 
35,000 new jobs. And like my colleagues here, I would have 
liked to see more infrastructure spending in the stimulus bill, 
but now it is our time to move on and to get a new 
transportation bill done.
    The other thing that I don't believe has been pointed out 
that is a real concern of my constituents is just the lost 
economic time when people sit in traffic. I am here talking 
about the fact that we should be doing more with rail, and we 
should be doing more with highways and making them more 
efficient.
    In fact, Americans spend 4.2 billion hours a year stuck in 
traffic, at a cost to the economy of $78.2 billion or $710 per 
motorist. And that is why I have been intrigued by the interest 
in public transportation in our State in places that are pretty 
conservative areas that suddenly want the train expanded from 
Big Lake to St. Cloud, that want bus lanes, that want more bus 
stations. And I think it has been a new found interest in that 
kind of public transportation, in addition to the expansion of 
roads and bridges and other things that are really the meat and 
potatoes of how we look at transportation policy in our State.
    So I want to thank you for being here. I look forward to 
hearing from you today.
    Thank you.
    Senator Boxer. Thanks so much for your patience, and we are 
going to start with our panel: Peter Rahn, Director, Missouri 
Department of Transportation, on behalf of the American 
Association of State Highway and Transportation Officials.
    And I want to thank you personally for the work you did to 
help us finally get this short-term extension, and now 
hopefully the long-term extension done. So why don't you go 
right ahead, Mr. Rahn.

  STATEMENT OF PETE K. RAHN, DIRECTOR, MISSOURI DEPARTMENT OF 
TRANSPORTATION, ON BEHALF OF THE AMERICAN ASSOCIATION OF STATE 
              HIGHWAY AND TRANSPORTATION OFFICIALS

    Mr. Rahn. I am Pete Rahn, Director of the Missouri 
Department of Transportation, and on behalf of the American 
Association of State Highway and Transportation Officials I am 
here to talk with you about the importance of transportation to 
the economy.
    But first, Madam Chairman, let me thank you, and of course 
Senator Bond and the members of this Committee for your 
leadership in passing legislation last week which extended the 
highway and transit programs until the end of the year. That 
action was absolutely crucial to my State and to all States.
    As a matter of fact, there was so much uncertainty a week 
ago as to the future of the highway program that I had to 
announce the suspension of the February letting and the 
potential shutdown of all future highway contracting in the 
State for the remainder of the fiscal year. I understand that 
some of the contractors affected by that decision may have 
contacted Senators here in Washington to ask for their help in 
passing your bill.
    Let me turn now to the Economic Recovery Act. On February 
17th of last year, Missouri started construction on our 
Nation's first highway stimulus project within minutes of the 
President's signing the bill into law. Our Osage River Bridge 
Project replaces a Depression era structure that was in 
desperate shape. Stimulus funding has had a huge impact in 
Missouri. A survey of a dozen of our largest contractors has 
found that MODOT now makes up more than 90 percent of their 
workload, when traditionally we would be about 40 percent. ARRA 
has worked, and it is filling the void.
    States have pushed hard to create jobs and deliver projects 
under ARRA. On February 19th, 2010, California fully obligated 
its $2.57 billion in ARRA highway funding. As of yesterday's 
deadline, every State obligated every highway dollar they were 
eligible to receive, and not one dime will be returned to 
Washington, DC, for redistribution.
    I understand that every member of the Committee has been 
given a copy of AASHTO's report, Projects and Paychecks. It 
found that States have created or saved 280,000 direct on-
project jobs. While transportation, as of December of last 
year, received 6 percent of total ARRA resources, it created at 
least 14 percent of the 2 million direct jobs saved or created 
to date.
    Longer lasting economic benefits include repair or 
replacement of 1,125 bridges, resurfacing of 21,400 miles of 
pavement, and the purchase of 7,450 buses. My answer to the 
question: Is transportation important to the economy? You bet 
it is.
    Transportation is a $1.2 trillion industry, generating 8 
percent of the jobs and accounting for 9 percent of the U.S. 
economy. It supports agriculture and natural resources, 
manufacturing, retail and services. Together, these businesses 
and industries account for 84 percent of the U.S. economy.
    Demand for freight has increased steadily since the 1970s. 
However, the freight productivity improvements gained through 
the Interstate Highway System and deregulation of trucking and 
the railroads are beginning to fade. Freight demands have now 
exceeded the capacity of the Nation's highways, rail, waterway 
and port systems, and we are facing a freight transportation 
capacity crisis.
    AASHTO will shortly publish a report called The Freight 
Transportation Bottom Line, which examines demand, capacity and 
the implications of congestion and deteriorating freight 
transportation performance and what should be done about it. We 
will provide this to you.
    The final freight issue I want to raise is global 
competition. China spends 9 percent of its GDP on 
infrastructure; India, 3.5 percent; and the United States less 
than 1 percent. Their economies are growing far faster than our 
own. If we are to maintain our economic competitiveness, 
national investment in transportation needs to increase.
    In 2010, there are two things the Senate can do to help 
assure that our transportation can help sustain economic 
recovery. First, we hope you can enact a new jobs bill similar 
to the one which passed the House, which provides $27.5 billion 
for highways and $8.4 billion for transit. Second, we hope you 
can complete action on a multi-year authorization. Funding this 
program at the $500 billion level pending in the House will 
have AASHTO support.
    We need a balanced bill that increases funding for both 
highways and transit, and funds continue to progress on high 
speed rail. We also need a balanced bill which meets the needs 
of both rural and urban parts of the country. Funding the 
program at the $500 billion level would help to double transit 
ridership, preserve and modernize the highway system, and 
launch a new era of inner city passenger rail. We believe such 
investments are vital to the economy.
    Thank you, Madam Chairman.
    [The prepared statement of Mr. Rahn follows:]
    
    
    
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    Senator Boxer. Thank you very much.
    And Dr. Buechner, Vice President of Economics and Research, 
American Road and Transportation Builders Association.
    Thank you very much.

STATEMENT OF WILLIAM R. BUECHNER, VICE PRESIDENT, ECONOMICS AND 
RESEARCH, AMERICAN ROAD AND TRANSPORTATION BUILDERS ASSOCIATION

    Mr. Buechner. Well, good morning, Chairman Boxer, Senator 
Inhofe and members of the Committee. Thank you very much for 
inviting ARTBA to be part of this hearing.
    You asked us to address two key issues in our testimony 
today: first, the impact of transportation investment and the 
Federal Surface Transportation Program on jobs; and second, its 
impact on American competitiveness in the world market.
    I can answer both questions on one breath. The impact is 
enormous. Last year, $120 billion of construction was performed 
on transportation infrastructure in the U.S., making this the 
second largest construction sector in the United States, only 
second to home building. That $120 billion investment supports 
nearly 3.4 million American jobs: almost 1.7 million jobs in 
construction and 200 supplier industries plus an additional 1.7 
million throughout the economy that are sustained by 
transportation construction in employee firm and agency 
spending.
    To put that in perspective, transportation construction 
sustains about 2.5 times as many American workers as motor 
vehicle and parts manufacturing in this country, so it is a 
very important industry. The importance of the Federal Surface 
Transportation Program to this sector of employment can't be 
overstated. Over 90 percent of the U.S. transportation 
infrastructure is publicly funded and maintained. And about 45 
percent of the capital investment in transportation 
infrastructure comes from the Federal Government.
    But there is another very important dimension to this job 
story, and it helps articulate how vitally important the 
Federal Surface Transportation Program is to America's future 
competitiveness. The work product delivered by the men and 
women employed in transportation construction makes possible 
the jobs that exist in virtually every other major sector of 
the U.S. economy.
    For example, how many tourism related jobs would exist in 
the United States without our network of highways and transit 
and railways and water ports and airports? How many 
manufacturing jobs, how many retail jobs, how many trucking 
jobs? The fact is, we believe that conservatively about 78 
million American jobs are fully dependent on the existence of 
the Nation's transportation infrastructure. These are what we 
call dependent industries. And it fleshes out the importance of 
transportation investment to jobs in the United States.
    Most economists will tell you that along with advanced 
telecommunications, the relatively low cost and reliability of 
freight transportation in the United States has been critical 
to this country's economic success for years.
    Unfortunately, we are letting this competitive advantage 
slip away. The latest commodity flow survey shows that almost 
80 percent of freight in the U.S. is shipped by truck over the 
Nation's highways, and much of the rest are multi-modal 
shipments that include trucks. So the competitiveness of 
American business depends on an efficient, reliable highway 
system.
    The growth of traffic in recent years has far outstripped 
the increase in highway capacity, and each year congestion gets 
worse and worse. The impact on trucking is costing American 
businesses billions of dollars each year in lost productivity 
and higher costs that make U.S. industry less competitive.
    Let me quote from a recent article by Michael Lind, Policy 
Director for the New American Foundation, where he says, 
``America's failure to modernize its overloaded freight 
transportation infrastructure, chiefly the railroad network and 
highways used by trucks, is imposing costs on American 
efficiency. As a result of congestion, the penalty on American 
growth rose from 8.6 percent of GDP in 2003 to 10.1 percent in 
2007, even before the crisis.''
    Chairman Boxer and members of the Committee, the Nation's 
transportation challenges are not going to solve themselves. I 
cannot stress enough the importance of enacting a new, robustly 
funded multi-year surface transportation authorization bill 
this year. This measure must focus on clearly unmet national 
needs such as good movement, traffic congestion and public 
safety.
    To that end, we urge you to carefully consider the merits 
of the critical commerce corridors freight movement proposal 
the ARTBA membership has developed. We are certainly aware of 
the difficulties facing reauthorization, but there are also 
grave consequences for failing to act. One example is that the 
Recovery Act's transportation investments will be tailing off 
rapidly by the end of this year. This means that absent a new 
infusion of capital investment, the hundreds of thousands of 
jobs being supported by these funds will also come to an end.
    We greatly appreciate your leadership in commencing today's 
hearing and shepherding legislation to stabilize the Highway 
Trust Fund through the Senate last week. Be assured, the 
American Road and Transportation Builders Association stands 
ready to provide any assistance it can as you work to develop a 
multi-year bill.
    Again, thank you for inviting us to testify.
    [The prepared statement of Mr. Buechner follows:]
    
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    Senator Boxer. Thank you so much.
    Next, we will hear from Raymond Poupore, Executive Vice 
President, National Construction Alliance.

  STATEMENT OF RAYMOND J. POUPORE, EXECUTIVE VICE PRESIDENT, 
               NATIONAL CONSTRUCTION ALLIANCE II

    Mr. Poupore. Thank you, Chairman Boxer, Ranking Member 
Inhofe, and distinguished members of the Committee.
    On behalf of the National Construction Alliance II, a 
partnership between two of the Nation's leading construction 
unions, the International Union of Operating Engineers and the 
United Brotherhood of Carpenters and Joiners of America, I want 
to express our appreciation for the opportunity to join you 
today.
    The two unions of the Alliance together represent nearly 1 
million workers, the same workers who build our Nation's 
highways, bridges, transit systems and much more. As I begin my 
testimony, the construction industry is in a depression, 25 
percent unemployment, 2 million construction workers without 
jobs, the worst construction economy since World War II.
    Together, we need to put America back to work. The NCA II 
believes that the Environment and Public Works Committee can 
and should play a key role in American economic competitiveness 
by undertaking two equally important--but separate--steps in 
the area of transportation policy and investment.
    The Committee should adopt both a short-term and long-term 
strategy to aid the ailing national economy through 
transportation investments. First, the Environment and Public 
Works Committee should continue to provide its leadership in 
developing an immediate investment in jobs legislation. It 
should include the full array of infrastructure in the 
Committee's jurisdiction--wastewater, drinking water, locks and 
dams--with highway transportation playing a lead role.
    The first prong of the strategy is necessary immediate 
investment in transportation to create jobs in the short term. 
And let me thank you, Chairman Boxer, on your work with 
Senators Durbin and Dorgan to develop another infrastructure 
investment package before this construction season.
    The bipartisan effort by certain Committee members to 
support transportation funding on the HIRE Act last week was 
also much appreciated. That was a key step, but we hope only 
the first one. That investment nearly stabilizes the inadequate 
SAFETEA-LU funding level. The Nation needs another investment 
in good transportation related jobs now.
    A key consideration for the short-term infusion of 
infrastructure spending is this: every dollar invested in 
construction generates another $1.59 that flows through the 
rest of the economy. This multiplier effect is higher for the 
infrastructure investments than for any policy under 
consideration, except for direct transfer payments.
    Investing in infrastructure is literally the best short-
term job creation move that Congress can make. Members of the 
Carpenters and Operating Engineers and the other building 
trades need paychecks now, and the rest of the economy will 
benefit not only in terms of directly attacking high 
unemployment in construction but also by making an essential 
down payment in the competitiveness of the Nation.
    That point brings me to the second longer range 
recommendation of the NCA II, enacting a multi-year 
transportation authorization. In coordination with the other 
Committees of jurisdiction, the EPW Committee should 
immediately begin the work of authorizing a multi-year 
transportation bill and enacting it into law as quickly as 
possible. Through transportation investments in the 
authorization of a multi-year bill, the Committee can greatly 
enhance the country's competitiveness in the global 
marketplace.
    The Nation's transportation system is being left in the 
dust by some foreign competitors. Spain, China and Japan are 
leaving the U.S. behind on high speed rail. Asia and Europe 
boast the world's best, most efficient airports. None of the 
world's top 10 airports are in the United States.
    Madam Chairman, a long range authorization provides 
certainty for transportation planners and construction 
employers. Construction contractors won't make investments in 
new equipment, for example, unless they have long-term 
certainty about future work opportunities. State officials 
won't conduct the design and engineering work and prepare the 
projects unless they have predictability about available 
resources.
    Similarly, the construction trades won't be able to bring 
in new apprentices into the industry unless there is certainty 
about future job opportunities. It doesn't do anyone any good 
to prepare a worker for a job that doesn't exist. It takes 
around 4 years in most of the trades apprenticeship programs to 
become a journey level worker.
    Just as business and the labor community come together 
around transportation investments, we hope that Democrats and 
Republicans will be able to come together to make the necessary 
investments to move this Nation forward.
    We thank the Environment and Public Works Committee for 
conducting this hearing and what we hope and understand will be 
a series of sessions to develop the policy that will guide the 
Nation through a key phase of economic progress. The NCA II is 
particularly appreciative of Senator Voinovich's efforts to 
have the majority leader commit to scheduling a floor vote on a 
multi-year transportation authorization in 2010.
    In conclusion, the NCA II urges the Committee to support a 
dual transportation investment strategy. We need a short-term 
investment in infrastructure now to reach the under-utilized 
markets in the 2010 construction season, and we need a long-
range, multi-year authorization designed to provide certainty 
to planners, contractors and workers, ensuring that the 
Nation's highways are safe and efficient, and that the United 
States reasserts its place as the world's economic powerhouse 
undergirded by a world class infrastructure.
    Madam Chairman, thank you and this Committee for the work 
you have done in helping put America back to work, and thanks 
for the opportunity to offer this testimony.
    [The prepared statement of Mr. Poupore follows:]
    
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    Senator Boxer. Thank you so much.
    Before I call on Tom Foss, I just want to note that when he 
finished, we are going to turn to Senator Whitehouse for his 
opening statement, and then to Senator Voinovich for his.
    Senator Whitehouse. I will waive.
    Senator Boxer. So, fine.
    Mr. Foss, and I want to say that you are representing the 
General Contractors, is that correct, today?
    Mr. Foss. Yes, Senator Boxer.
    Senator Boxer. And you are President and Chief Operating 
Officer of the Griffith Company, and you are speaking on behalf 
of the Associated General Contractors of America.
    And I just want to personally thank that organization for 
all you did to help us get where we are today. I know you are a 
Californian. We welcome you.

 STATEMENT OF TOM FOSS, PRESIDENT AND CHIEF OPERATING OFFICER, 
     GRIFFITH COMPANY, ON BEHALF OF THE ASSOCIATED GENERAL 
                     CONTRACTORS OF AMERICA

    Mr. Foss. Thank you, Senator Boxer.
    Madam Chairman, members of the Committee, thank you for the 
opportunity to present testimony on the importance of 
transportation investment to the national economy and jobs. 
Like Senator Boxer mentioned, my name is Tom Foss. I am 
President and CEO of Griffith Company. We are a 108-year-old 
general engineering contractor operating in Southern 
California.
    I started with Griffith Company in 1978 as a laborer. I 
know this business from the outside and in. Griffith Company 
builds highway infrastructure, bridges, airports, et cetera, 
and I am here representing the Associated General Contractors 
of America.
    The U.S. transportation system unites road, rail, air, 
seagoing commerce into a nationwide network that connects 
customers to manufacturers who are often on different sides of 
the globe. Much of this system was provided through Federal 
transportation programs which have largely been administered by 
States as agents of the Federal Government.
    The program has been successful in establishing the best 
transportation system in the world. The efficiency of the 
Nation's transportation system, particularly its highways, is 
critical to the health of the Nation's economy. Efficient 
transportation plays a key role in business productivity, 
product cost, quality of life, global competitiveness and jobs.
    An efficient transportation system is important to the 
construction industry because we are a major user. Construction 
materials and supplies accounted for 1 out of every 10 U.S. 
manufacturing shipments and 1 out of every 16 machinery 
shipments in 2009. For a company like Griffith, transportation 
is important to our business--it impacts the movement and 
delivery of products to our jobs.
    Traffic congestion causes contractors to schedule 
deliveries at times that may not be most cost effective or 
efficient. Managing construction start and finish times are 
also impacted by the ability of workers to get to the job site.
    Here is an example. We price our work in downtown Los 
Angeles. When we calculate the movement of goods, we use an 
average of four miles an hour for our truck speed. As we get 
out to areas of less congestion, we may use a rate of 30 to 40 
miles an hour for the movement of goods. That is a multiplier 
of cost in construction.
    For the construction industry, the transportation program 
represents the market in which we work. Griffith Company relies 
on the transportation industry for market opportunities and the 
livelihood of our 485 workers and the families they represent. 
Our employees are our greatest asset, and they reflect the 
communities in which we work.
    The economic slow-down has hurt our industry. Since the 
peak construction employment in January 2007, 1.7 million 
construction jobs have been lost, with job losses accelerating 
significantly over the past 12 months. This is because the 
total construction market contracted by more than $100 billion 
in 2009 over 2008.
    As you have heard, construction unemployment currently 
stands at nearly 25 percent. Construction employment in 
California has dropped 37 percent in the last 4 years and 
stands at the lowest level since 1998.
    In California, as elsewhere, the collapse of the housing 
and commercial markets has led to an increase in the number of 
contractors competing in the public sector. A few years ago, 
CalTrans averaged three to four bidders on their projects. 
Today, that number is between 9 and 10. I have seen projects 
with well over 20 bidders. The bidding climate is very 
difficult to be low bidder and more difficult to make a profit.
    One of the largest risks for a company like mine is the 
failure of subcontractors. We began to see failures last year, 
and we anticipate this trend to continue in 2011. Both general 
contractors and subcontractors will have a high failure rate 
this year, with many of these businesses being small 
businesses.
    The ARRA money was a help to our industry. In California, 
it was a big help. Without having a long-term bill, the 
uncertainty permeates down into the local and State markets. 
For example, Caltrans has a list of projects budgeted at about 
$770 million ready to be built but waiting for funding. We need 
stability and continuity in this program. Without that, the 
State and local agencies stop bidding work. It puts everything 
about my business at risk. The uncertainty that comes, my 
relationship with my bank, my insurance company, my surety 
company, all have added stress because of the uncertainty in 
our market.
    Bottom line, the highway program needs to have the long-
term program. This program is a pay as you go program. The 
system's user fee is deposited in the Highway Trust Fund, which 
is then used to improve the system. We need to enhance that. 
The multi-year authorization is needed to restore faith in the 
program, build the system we need to reduce congestion, and get 
our goods to market.
    It is our responsibility to leave future generations a 
legacy that provides them the foundation for future economic 
growth as solid as the one that we inherited. Now is the time 
for a multi-year bill.
    Thank you.
    [The prepared statement of Mr. Foss follows:]
    
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    Senator Boxer. Thank you so much.
    Well, I think this panel was terrific, and I would turn to 
Senator Voinovich for his opening statement.

        OPENING STATEMENT OF HON. GEORGE V. VOINOVICH, 
              U.S. SENATOR FROM THE STATE OF OHIO

    Senator Voinovich. I just would like to say that your 
presentations were terrific. And I look at this as the need for 
our infrastructure as a country, the opportunity to pass a bill 
that would be one that would be different than what we have 
done in the past. It would deal with some of the real problems 
that we have out there.
    No. 2, that of the jobs that are there, and you have 
eloquently talked about those jobs. Carbon footprint, we 
haven't talked about that, but we are talking about reducing 
greenhouse gas emissions, and this will have a dramatic impact 
on reducing emissions, so it is a two-fer from that point of 
view.
    Return on investment, you were mentioning. You know, in 
Ohio the bids are coming in 10, 12 percent below what they were 
a couple of years ago, so there is a lot of competition. We are 
going to get a lot more return on our buck than we have in the 
last several years.
    The certainty of it I think is extremely important, and you 
have emphasized that, that we need to have it so that we know 
where we are going.
    Mr. Foss, I know contractors that are out of business today 
because their line of credit has been shut off because they 
don't know what the future looks like today.
    And I think that the last part of this, I think, we are 
talking about human beings. And this reauthorization with 
robust funding would take and put a segment of our economy in 
place for the next 5 years. In other words, people could bank 
on it. Today, people, it is uncertainty.
    So I think what we should be doing also is thinking about 
all the families out there, millions of people who are worried 
about whether they have a job, or whether they are going back 
to work, or whether they can pay their mortgage, whether they 
can buy a car, whether they can fund their kids' education, 
whether they can just do other things that they would like to 
do. We have got to listen to that and our company.
    Thank you, Madam Chairman.
    Senator Boxer. Senator Voinovich, I wanted to say something 
that I said before you came. I made a commitment to Senator 
Bond and to you, in your absence at that moment, that we will 
do a bill that you will participate in, and we will get that 
bill done in this Committee. I feel very confident in that, and 
this today is the kick-off of that bill.
    So I want to thank you for your strong--I mean, I just want 
to say for the record, Senator Voinovich has been pushing for 
this long 5-year reauthorization for a long time now. And now 
that we hope we have gotten the 1-year extension behind us--we 
are not sure, but looks good for Thursday in the House, we are 
hoping--we will be able to get moving.
    So I am going to start with Mr. Rahn. First, again, I want 
to thank you for your February 19th notice to contractors for 
this reason. You brought it home to the American people and to 
us that there are consequences for our actions or inactions. 
And I blew up your letter, and I made sure that everybody knew 
that if we didn't move on the short-term extension and then now 
on this yearly extension, that there would be a dire situation. 
And so you told us today that you took that very dire step 
because you had to take it.
    And so I wanted to ask you, in your own words because you 
are very forceful, to explain what a long-term extension, and 
that means the yearly extension, and then the 5-year 
authorization, what it would mean to a State like yours, the 
certainty of this.
    Mr. Rahn. Madam Chairman, thank you for your comments.
    The fact is that trying to deliver a construction program 
of hundreds of millions of dollars requires years of planning 
and a great deal of effort in delivering those projects, and 
choreographing that with environmental agencies, contractors 
and such. And we simply cannot do that on these 30-day fits of 
starts and stops. And we can't make long-term decisions and 
neither can contractors. No contractor is going to buy a 
$500,000 piece of equipment if they don't know that there is a 
program that is going to be out there for the next 5 to 6 
years.
    And so the entire realm of highway and transit construction 
means you need a certain, an absolute stream of revenue to be 
able to make long-term decisions and undertake these projects.
    For us in Missouri, the fact is even with the Senate's 
adoption of the House version of a 30-day extension, it has not 
resolved the issue of the authorization level of $30 billion 
versus $42 billion.
    Senator Boxer. Right.
    Mr. Rahn. And so today that means I still cannot release 
our letting process. Not only did I have to cancel last 
Friday's letting, Monday should have been the day that we 
advertised for the March letting. And we have not advertised 
for the March letting either.
    What is at risk right now is this: if we do not get the 
authorization level restored to the funding levels of 2009, 
Missouri will have to make up a $243 million shortfall in the 
current fiscal year, and the only way we can do that is to 
cancel our lettings from February through June to make up for 
this $243 million shortfall.
    Senator Boxer. OK. Well, colleagues, this is so critical 
because that is why this Thursday vote in the House is so 
important. If they pass this under suspension of the rules, we 
have taken care of the yearly extension. That would solve your 
problem. Is that correct, Mr. Rahn?
    Mr. Rahn. Yes, Madam Chairman.
    Senator Boxer. OK. I hope you can let all the Missouri 
Congresspeople understand this. Would you do that for me? Would 
you do that?
    Mr. Rahn. Absolutely.
    Senator Boxer. And will all of you on the panel commit to 
please, if you could stay around today and talk to those House 
Members. Would you do that, all of you? Could I see all of you 
shaking your head yes, that you will contact those? Because we 
have done it over here. We took care of it over here in the 
HIRE Act, H-I-R-E Act, and we need you to do that.
    I wanted to talk to my constituent, Mr. Foss, about the 
impact on small businesses. We all know that the smaller 
contractors and subcontractors are so essential to the whole 
process. And I wonder how can we, through our program, help 
these businesses remain competitive and stay in business? Does 
it get to the issue that Mr. Rahn talked about, which is the 
certainty of a long-term bill?
    Mr. Foss. The entire premise of the long-term bill is to 
allow the agencies to get a planned program in releasing the 
work. Subcontractors that work for Griffith Company will have 
opportunity on business just based on my ability to bid on work 
as well.
    In California, lots of our agencies, Los Angeles in 
particular, they have a set-aside for small business, like we 
do on the Federal level, for the under-utilized businesses or 
the disadvantaged businesses. Los Angeles opens that up to 
small business. That gives small business an opportunity to 
enter into our industry on a competitive level to get the work 
they need to stay in business.
    Senator Boxer. So you think that certainty is the key here?
    Mr. Foss. The certainty is the key.
    Senator Boxer. OK.
    Mr. Foss. Yes, ma'am.
    Senator Boxer. Very important.
    OK, we will turn to Senator Inhofe for his questions.
    Senator Inhofe. Thank you, Madam Chairman.
    We talk a lot about the jobs, and that is very, very 
important. I think, though, that the primary thing is the 
crumbling infrastructure. I know in our State of Oklahoma, we 
have had some real crises take place, and it gets worse. It 
doesn't get better. So in helping us to build our case with 
some of the people with whom we work, let me just ask a couple 
of things here.
    Dr. Buechner, you talked quite a bit about the jobs.
    One of the things I think came from you, Mr. Rahn, when you 
talked about the amount in the stimulus bill, which we could 
argue what the amount was. I think in terms of just the roads, 
highways and bridges, we are talking about 3 percent, maybe up 
to 5 percent if you are talking about transportation.
    But that provided, of all the jobs that came from the 
stimulus, 25 percent of the stimulus bill in terms of the 
number of jobs that, in other words, 4 percent of the bill 
provided 25 percent of the jobs. Is that accurate?
    Mr. Rahn. [Remarks made off microphone.] As of December of 
last year, 6 percent of the total ARRA resources, and 14 
percent of the direct jobs.
    Senator Inhofe. OK. Now, all right, direct jobs.
    Now, one of the things that is not talked about are the 
indirect jobs, the long-run jobs, the getting people to work, 
getting businesses and industries so that they can operate and 
not be just clogged up. Is there anything further on that that 
anyone would like to say in terms of the long run jobs over and 
above just that which is directly related to jobs?
    Yes.
    Mr. Rahn. The fact----
    Senator Inhofe. Turn on your microphone, please.
    Mr. Rahn. The fact is that when we talk direct jobs, that 
is only measuring the people working on the project, and that 
doesn't even take into account the people that are making the 
steel girders or quarrying the rock or the ready-mix plants. 
This number does not include this very indirect jobs support 
that was created from this activity, and of course the long-
term support that is created to all of these various industries 
that rely----
    Senator Inhofe. Yes, that is my point. There are two things 
here: the indirect jobs and then the long-term, how this helps 
others. And I know there have been studies, and that is the 
kind of thing that we like to hear so we can use that.
    Other comments on that particular thing?
    Yes, Mr. Foss.
    Mr. Foss. I think the AGC, the way they put their stats 
together on that information is they are saying that direct 
jobs per billion of dollars invested is about 19,500, with 
another 9,700 of indirect jobs, which are material suppliers of 
course, but then also those are the jobs that go on, that are 
the restaurants that workers eat out in and further on into the 
economy. That is how AGC looks at those numbers.
    Senator Inhofe. OK. That is good. Now, the last 
Administration had a figure, and I have it down here. It is 
34,779 jobs for every billion dollars that is invested in 
highways. Do you think that figure is still good?
    Mr. Rahn. Yes, Mr. Chairman.
    Mr. Buechner. It is still pretty good.
    Senator Inhofe. OK. The other thing I wanted to ask----
    Mr. Buechner. May I respond?
    Senator Inhofe. Of course. I want you to.
    Mr. Buechner. I think when you are looking just at the 
direct and indirect jobs created by the actual transportation 
projects, you really miss a very big part of the picture, which 
is the impact that the improvements have on the rest of the 
economy.
    Senator Inhofe. No, we didn't miss that. Apparently, you 
weren't listening because I said there are two things----
    Mr. Buechner. No, no, I am sorry. But we haven't discussed 
that yet. You discussed it, yes.
    Senator Inhofe. Oh, OK. Fine.
    Mr. Buechner. And you know, the fact is, as we point out, 
there are a number of industries that are totally dependent on 
the transportation infrastructure, almost for their existence. 
And you know, in the last two or three decades we have been 
losing a lot of manufacturing jobs and things like that to 
China and India, where they have been beating us even with very 
primitive infrastructure. But they are now doing what they need 
to do to improve their infrastructure. China has embarked on a 
$40 billion massive expressway program. India is also creating 
massive expressways. And so they are now going to take this to 
the next level.
    And we have been fortunate, though, a lot of the good jobs 
have still remained here, the high paying creative jobs, but 
they are targeting those jobs now. And we are going to be in 
even worse trouble if they succeed in getting their 
infrastructure up to where ours is, and we don't take the steps 
that we need to be doing.
    Senator Inhofe. Yes, that is a good point.
    In your statement, Mr. Poupore, I had asked them to pull 
this out of your statement because you said, ``A key 
consideration for the short-term infusion of infrastructure 
spending is this: Every dollar invested in construction 
generates another $1.59 that flows through the rest of the 
economy.''
    What is the source of that? That is a good one. I am 
looking for talking points here, and I think that is a good 
one.
    Mr. Poupore. That comes from our research directors at the 
Operators and the Carpenters. This multiplier effect is pretty 
much what you were just talking about with every billion 
dollars invested. For example, right now we are building the 
extension of the Metro out to Dulles Airport. And I was just 
talking to the project manager this morning, and we have about 
550 direct hire people on the project.
    But more importantly, they are building new rail cars and 
the steel for it, and the concrete is being put together. And 
everybody that is working on the project needs to have 
protective equipment and shoes. And it just goes on and on and 
on.
    If they were sitting home without any jobs, none of those 
other things get going. So that is where that $1.59 comes from.
    Senator Inhofe. Good.
    Thank you, Madam Chair.
    Senator Boxer. Thank you so much.
    Senator Klobuchar.
    Senator Klobuchar. Thank you, Madam Chair.
    I wanted to get your feelings on the Build America Bond 
Program, how that is going. As you know, it is something that I 
have been supporting and Senator Wyden and Senator Thune and 
other people. Do you think it is being utilized to the fullest 
extent? And what is your recommendation on how to make it 
better with States where it has been slow?
    It looks like, Mr. Rahn, you want to answer that.
    Mr. Rahn. Senator, I believe Build America bonds have been 
very successful. Missouri has issued several hundred million 
dollars of debt utilizing the Build America bonds. I think that 
it has provided another vehicle to us to leverage the resources 
we have.
    But I do need to add that ultimately the problem that we 
have within infrastructure today is not ways to borrow more 
money. We have pretty much borrowed everything we can. We now 
need to be able to pay for the improvements that need to occur. 
So Build America bonds have been positive. We have utilized 
them. I know many States have utilized them, and they have 
found that it has been a way to reduce borrowing costs. So it 
has made the cost of our borrowing less.
    But for years now, actually for the last decade and a half, 
States have been borrowing money to pay for infrastructure, and 
we have now tapped out the credit card, and it is now time we 
need income to make those payments and to pay for the 
improvements we need on our system.
    Senator Klobuchar. Right. Good.
    Mr. Buechner, in your testimony, you raise this interesting 
point about how some States are better at getting highway 
projects under construction more than others, which leads to 
more efficient utilization of resources and creation of jobs. 
Could you elaborate on that? And what are some of the 
differences between the well performing and the poor performing 
States?
    Mr. Buechner. Well, clearly, States like Missouri that 
anticipated this and had projects ready to go, has done an 
excellent job of getting projects underway. Pennsylvania has 
gotten a large number. Utah, Maine, and a number of States have 
done very well in getting projects underway. There are a few 
that have been laggards.
    And I think it is kind of interesting that money that was 
coming to the States, 100 percent federally funded projects, a 
lot of the States, why some States wouldn't have actually just 
gotten all that money out there and getting it going as fast as 
possible.
    But I think the importance of those funds is going to 
continue to be felt this construction season when a lot of the 
construction work will be done on projects this year. So even 
though some States may not have gotten things going quite as 
fast as others, everybody this year is going to be benefiting 
from the Recovery Act funds.
    Senator Klobuchar. I just think at some point it will be 
helpful to know what States did that and how we can use those 
as better examples.
    Mr. Buechner. We have a monthly report that we put out. I 
will send a copy to you.
    Senator Klobuchar. OK. Thank you.
    Mr. Foss, you note in your testimony that increasingly 
companies are looking at the quality of a region's 
transportation system when deciding when to relocate or expand. 
Do you have any specific examples of that?
    Mr. Foss. No, I don't have any specific example on that. 
However, in California, just listening to the news and the 
reports that come out, our industry is having a drain in 
California, and a lot of that is then related back to the 
plants are relocating where they can actually get to work and 
get their products shipped.
    Senator Klobuchar. Yes. You also talked about how, and I 
know some of the panel has talked about it ahead of time, the 
benefits of the long-term transportation bill will provide in 
terms of certainty for workers and the industry. How does this 
impact the way construction companies manage their work forces, 
if you know with certainty what is happening?
    Mr. Foss. Griffith Company works within our means. As a 
company, we typically don't reach out to get increased volume. 
But as we grow, the most important piece of our company is the 
employee. And we are looking for our labor unions to provide us 
with quality workers, and we have to plan long range. When you 
go to pour a bridge deck, we have poured some big bridge decks 
in the last year where we poured around the clock, and we had 
over 120 carpenters, masons, laborers on our bridge deck at 
different shifts.
    We have to plan for our work force in everything we do. 
Without the certainty of work, we begin to lose employees. We 
can't keep them on, even valuable employees. And Griffith 
Company is a very stable company. We try to keep our best 
people on board all the time.
    Senator Klobuchar. OK. Very good. Thank you very much.
    Senator Boxer. Thank you, Senator.
    Senator Voinovich.
    Senator Voinovich. Mr. Buechner, you have done a good job 
in your testimony to talk about the impact that transportation 
construction industry have on the U.S. economy. And you have 
various things that you have made reference to. But can you 
capture just of the total U.S. economy, I think you have 
something here where it contributes to--what?--2 percent of 
GDP.
    Mr. Buechner. Yes, sir.
    Senator Voinovich. But it is more than something else. To 
try to give us something that we can use to say to the 
Administration or to anyone that if we had this 
reauthorization, and it was robust, what portion of the economy 
could we basically say is going to be OK and have certainty for 
the next 5 years?
    Mr. Buechner. Well, I think directly it is the 
transportation construction sector of the U.S. economy that 
would benefit immediately from this, from the State DOTs like 
Pete Rahn was saying, give them an opportunity to plan long-
term projects. Contractors would have an opportunity to hire 
workers, purchase equipment and things like that. So there 
would be an immediate impact on the transportation construction 
sector itself.
    And as Senator Boxer pointed out, every billion dollar 
increase in Federal funding for transportation supports 35,000 
new jobs. So if you have a 6-year authorization that ramps up 
Federal investment in construction in highway improvements and 
transit, you will be adding tens of thousands of new jobs in 
that sector each year.
    At the same time, there will be a widespread impact on the 
200 and some-odd industries that provide products and services 
to highway contractors and to bridge contractors, airport 
contractors and things like that.
    But I think, as I pointed out earlier in my response to a 
question by Senator Inhofe, that the long-term impact on this, 
on the rest of the economy probably it dwarfs the direct impact 
on the construction industry, the ability of manufacturing 
firms to lower transportation costs and therefore compete more 
effectively with manufacturers abroad. All throughout the U.S. 
economy, the increase in competitiveness, the increase in 
productivity would support even greater job growth than the 
numbers that we are talking about just in the transportation.
    Senator Voinovich. So the point is that it might be good on 
one piece of paper, two pieces of paper. You have done it, some 
good work here in your testimony. But to kind of lay it out so 
that when the Chairman of the Committee--by the way, I would 
like to congratulate the Chairman for the great work that she 
has done and how enthusiastic she is about moving on this, on 
the urgency of it.
    But I think if you had that list of things in terms of the 
impact on the economy and the jobs it would create, and then I 
think your contrast with some of the other areas, so people 
would be surprised at how much more it contributes than, say, 
some of the other things that you have listed here.
    And then the last half of it would be the indirect impact, 
which was brought up in somebody's testimony, about truckers, 
and I talked with Bill Graves, and he says his guys, they are 
getting maybe 60 percent out of what they were getting maybe, 
you know, 100 percent maybe 10 years ago, but what they are 
running into around the country. And some of these other side 
things that are real important, the competitiveness, say, with 
the Chinese as they move forward. It think Senator Inhofe made 
mention of that. But I think we need to really articulate that.
    And then the other thing is is that from the State point of 
view, and the certainty of your being able, you were mentioning 
about you are going to have to back off some of the lettings 
that you have done unless this thing gets worked out. And I 
think that your groups should lay out the fact that they are in 
trouble now, and if we don't get this thing done, what impact, 
the rippling effect it is just going to have on your ability to 
plan highways to the future. Because I don't think a lot of 
people understand. I do as a former Governor. It takes a long 
time to put one of these things together.
    And so I think there are some big issue things that we need 
to articulate to the public to get the kind of support that we 
are going to need for this. And I think that the more that you 
folks can raise this as a national priority and opportunity, 
the better off we are going to be.
    I think that we have a bill over in the House that I am 
sure the Chairman and I are interested and everyone is 
interested in what your thoughts are about that bill, because 
he has put a lot of work in it, Jim Oberstar. And then to start 
looking at some of the other things that we should do so that 
we can put this on a fast track and get it done.
    Last but not least, and that is the issue of financing. I 
had some folks in yesterday that talked about how they are 
doing some creative financing down in Texas and so forth. But I 
would be interested in--a gas tax is something that we have 
talked about, but what other types of financing would you have 
in mind that we could utilize? Because we are going to have to 
have kind of a smorgasbord of those things. And of course, that 
is Max Baucus's job because he is over in Finance.
    But honest to goodness, I think if we really pull together 
this can be a really great bipartisan thing, a good thing for 
our country. And we are really going to need your support. And 
as the Chairman said, we would like to have you talk to every 
single Member of the Senate, let them know how important this 
is, and run over to the House today.
    Thank you.
    Senator Boxer. We have prepared a list here of all the 
Democrat and Republican House Members from Missouri with their 
phone numbers.
    [Laughter.]
    Senator Boxer. I used to be a staff member, so I have done 
the staff work on this.
    [Laughter.]
    Senator Boxer. Senator Merkley.
    Senator Merkley. Thank you very much, Madam Chair. And 
thank you for bringing folks together to start paving the path 
for us to figure out the reauthorization of the transportation 
bill.
    This is such an important issue for every State and for our 
national economy. Certainly, as a member of the State 
legislature, we wrestled with how to take on major bottlenecks 
in the transportation system. We had a series of bills in three 
subsequent sessions--Connect Oregon I, Connect Oregon II, 
Connect Oregon III--trying to address mainly freight mobility, 
and looking not just at the road system, but also at the 
interconnectedness to our ports and to our rail.
    So one of the things that I wanted to ask is: To what 
degree is our transportation funding system caught in silos 
where we look separately at these key components of the 
transportation infrastructure? And is that perhaps not an 
issue? But if it is an issue, are there ways that we could 
think about how we start to make sure we are addressing the 
transportation system as a coherent whole involving intermodal, 
shipping, water shipping, and certainly rail shipping, as well 
as highway transportation?
    I will just open this up to whoever would like to comment.
    Mr. Rahn. Madam Chairman, Senator, the last count I saw had 
our Federal funding for transportation divided into 108 
different categories. And so there are absolutely silos and 
then cubicles within silos that actually make it quite complex 
for us to put together a funding package for any one particular 
project.
    And that is one of the issues that AASHTO has been 
requesting from Congress: that the next authorization bill is 
less cubicle with more flexibility to allow us to utilize 
funds. We do believe there is justification for some 
categorization of funds, but certainly not down to the level of 
108 categories, some of these representing a relatively very 
small amount of money, and yet having conditions on it. For 
instance requiring a full-time staffer at every State to deal 
with these very small programs.
    And so the idea of simplification, allowing more 
flexibility, allowing States to use money for either transit or 
highways, as an example, or ports. We support that concept, and 
we think it would be very useful and productive to allow States 
to use the flexibility to fund projects within broad areas.
    Senator Merkley. Anybody else want to jump into that 
conversation?
    Mr. Buechner. Yes, sir. When ARTBA's members started 
thinking about reauthorization, the No. 1 issue that we found 
as important was freight transportation because of its great 
impact on the economy. And that is kind of the lost stepchild 
of important elements of, you know, what States consider when 
they are thinking about what projects to do.
    For example, you know, I know Pete has, no matter how much 
money he gets from the Federal program, he still doesn't have 
enough money to do everything that needs to be done in 
Missouri. So when he is looking at projects, and he has one 
project that is going to help get workers or improve travel in 
St. Louis to get people to and from work, versus a project that 
is going to facilitate the shipment of freight from California 
to New England, I mean, he has got priorities that are going to 
say, we've got to get this first project done.
    So some of that may help freight, but it is not going to 
focus on freight. Congestion has become a very important 
obstacle to freight shipments in the U.S.
    So ARTBA proposed a Critical Commerce Corridors Program 
where we would separate out freight as a separate issue, 
develop a national kind of a freight plan: where do we need 
truck-only lanes; where do we need more capacity, not just on a 
State level, but on a national level. And a proposal would be 
to finance that particular kind of program through small user 
fees on shippers. You know, we have $11 trillion worth of 
freight shipped in the United States every year. A teeny 
freight user fee would raise billions of dollars that could be 
used to just improve corridors of freight in the U.S.
    Senator Merkley. Madam Chair, do we have time for me to ask 
one more question?
    Senator Boxer. Yes, OK.
    Senator Merkley. Utilizing your last comment as a segue to 
the revenue side, and I am sorry if I missed this if this was 
in earlier testimony, but given the propensity for folks to 
drive less and to drive in more fuel efficient vehicles, has 
our actual revenue from the gas tax dropped, and how 
significantly, and how much of an impact will that have without 
significant changes in the revenue strategy?
    Mr. Rahn. Madam Chairman, Senator, the States have seen 
declines in gas taxes, but overall it is a relatively stable 
tax, so it has not collapsed, but it has declined. And as we 
look forward, it is pretty clear that our Nation's energy 
policy, which says we want to utilize less petroleum, is in 
conflict with our national transportation policy which says we 
use the fuel tax to pay for our transportation system. And 
clearly these things are in conflict.
    So we have major issues going forward as States in trying 
to discern how it is we are going to pay for our transportation 
system that is becoming more expensive, not less; that is 
having different sorts of usage, freight being one of those 
that has never been anticipated at the levels that we are 
seeing; and how we are going to do that with traditional 
revenue streams that are not sufficient today, let alone being 
sufficient for the future.
    Mr. Buechner. And it is also an issue at the Federal level, 
with the gas tax revenues kind of leveling out in this 
recession and a major collapse in truck sales tax revenues. 
That is the second source of revenue for the Highway Trust 
Fund, which is a sales tax on large trucks. And you know, with 
the economy in a recession and freight shipments down for the 
last couple of years, nobody has been buying new trucks.
    Senator Merkley. Well, thank you very much for your 
comments on both points. The silo challenge, I guess I am kind 
of shocked by that 108 categories, and I am sure that every 
single one of them, there was a purpose at some point, but it 
certainly restricts flexibility. And thank you for your 
commentary on the challenges on the revenue.
    Thank you, Madam Chair.
    Senator Boxer. Thank you, Senator, for bringing up the 
revenue stream because, clearly, I have discussed this with 
Senators Inhofe and Voinovich, we are going to have to look at 
all the proposals that we can in order to make sure that our 
Finance Committee has every idea that is out there, because we 
do want to pay as you go on this.
    Did you want to add to that, Mr. Foss?
    Mr. Foss. Yes. I wanted to make a comment on that. Senator 
Voinovich had mentioned about creative, other ways to raise 
revenue. The industry is working on lots of other ideas other 
than the gas tax increase. But a lot of those ideas are future 
ideas. There are a lot of ideas on bonding and things like 
that, and tolls and vehicle miles traveled. There are a lot of 
ideas floating out there.
    But I would just like to say to the Committee, if I may, 
that the gas tax is still the best way to fund this program. It 
is a user fee. And as an example in California, we can 
advertise this to the general population. They understand 
traffic congestion. They understand their quality of life 
impact based on congestion. In California, we have begun to see 
a movement--it has been quite a few years now, we call them 
self-help counties. These counties put together a 
transportation plan for their specific county. They identify a 
good solid program where they identify specific bottlenecks 
that they are going to plan to improve. And those voters vote 
to tax themselves in the sales tax anywhere from an additional 
half to three-quarters of a cent specifically for 
transportation.
    The general public gets it. And I would just encourage the 
Committee to have the courage to move forward on that idea. The 
general public will support you on that if your program 
identifies specific programs. If you get rid of earmarks, if 
you get your program well identified, the general public is not 
afraid to tax themselves for better transportation and a better 
quality of life.
    Senator Boxer. OK.
    Senator Voinovich.
    Senator Voinovich. I think that one of the other challenges 
are big picture things that we need to communicate, but it 
seems to me that ARTBA, maybe working with AASHTO, could do 
some analysis statewide as to major things that need to be 
taken care of. Because I think the public has to understand 
that if this happens, and I assume that all of you would 
support an increase in the gas tax.
    Mr. Rahn. Oh, you can't do that because you are----
    Mr. Rahn. I can speak as an individual from Missouri.
    Senator Voinovich. But not as your Governor. Right. OK.
    [Laughter.]
    Senator Voinovich. All right. In your heart, you know it is 
something that we might have to do.
    [Laughter.]
    Senator Voinovich. But I think, as the Chairman said, we 
need to look at some other things. But I think that it is like 
everything else. It is the need that has to be communicated out 
there. And I think the other thing is that there is the number 
of jobs that could be created. I mean, AASHTO right now, Madam 
Chairman, is talking about, I don't know how many thousand jobs 
they could turn on just like that because the need is there. It 
is not like one of these, I mean, it is almost like a rocket 
going up in terms of jobs. If this thing passed, boom, we would 
see an increase in jobs in the country, which is something that 
we need to do.
    And then if you had that plus the impact that it is going 
to have in terms of a portion of the economy, I think it would 
be very good.
    Do you all get together at all? I mean, do your 
organizations talk to each other?
    Mr. Buechner. Absolutely.
    Senator Voinovich. I really think that is important because 
the Chairman is going to need as much help as possible. The 
more you can speak with one voice on things, it would be very, 
very helpful, particularly if we are going to move, in terms 
of--have all of you looked at the bill that came out of the 
Subcommittee in the House?
    Mr. Rahn. Chairman Oberstar's bill?
    Senator Voinovich. Yes. Have you looked at it, Mr. 
Buechner?
    Mr. Buechner. Yes.
    Senator Voinovich. How about AGC, have they looked at it?
    Mr. Foss. AGC has looked at it. Yes, sir.
    Senator Voinovich. Yes. Well, it would really help if you 
got the group together, and how much of it would you agree on? 
I know I have talked with the State and Local Government 
Coalition. That is the Mayors, the Governors, the National 
Society of State Legislators and the rest. It would be real 
interesting to all of us, wouldn't it, to find out just what 
you agree on with that and where you have differences.
    You were talking, Mr. Rahn, about the flexibility. Could 
you give us just an example or two of--what is it? How many, 
Madam Chairman, 110 categories or something?
    Mr. Rahn. Madam Chairman, Senator, yes, 108 categories in 
the existing SAFETEA-LU bill for funding categories. It is 
actually quite onerous to administer. While obviously, we are 
grateful for funding that comes to us to address 
transportation, it certainly could be streamlined. And there 
are broad areas of Chairman Oberstar's bill that we support. We 
have some areas that in fact we do believe need continued work.
    I think the issues that we are very supportive of are the 
need for a balanced approach that says both highways and 
transit need significant funding, and as well as a balance 
between urban and rural interests within that bill.
    And so those would be some of the areas that we would like 
to see improvement in Chairman Oberstar's bill.
    Senator Voinovich. He has reduced them down into 
categories. It would be interesting for us to find out just how 
you groups feel about collapsing those into the categories that 
are laid out and how receptive you are to those categories that 
he has laid out.
    Mr. Rahn. We would be happy to get that to you, Senator.
    Mr. Foss. Senator, AGC and AASHTO are AASHTO are currently 
doing just what you are asking. We are looking at the big 
picture as an industry. And like Pete mentioned, there are some 
areas, lack of flexibility, some of the micro-managing, that is 
in that bill we are looking to loosen up a little bit.
    The States and local agencies have done a good job working 
for the Federal Government being the administrator of these 
programs in the past, and we think that should continue.
    Senator Boxer. I just want to say to Senator Voinovich how 
much I appreciate his leadership. And I want to just say that 
I, speaking for myself, I want to team up with him on asking 
you to go through the Oberstar bill section by section. He has 
it down to nine sections. I vow to streamline our bill to 10 
sections at the most because that was the first advice of the 
Special Commission, Senator Voinovich, that came back after a 
year of study.
    But if you could go through that literally with a pen and 
let us know where you agree, where you disagree. If there is 
any problems or things you especially like, it would be very 
helpful. Because we are not going to start from scratch. We are 
going to take that bill and work off it, which was Senator 
Voinovich's idea. So we are going to look at that and go 
section by section.
    I just want to say to all of you how important you are to 
us. There are two ways to fight for things you believe in 
around here. One is an inside strategy, talk to our colleagues. 
The other is an outside strategy, engage the people who are on 
the ground.
    Frankly, you have so much credibility. And Thursday's vote 
is key. Otherwise, Mr. Rahn's State is not going to be able to 
have any progress. We have got to get that year extension 
behind us. And if we don't get it by a two-thirds vote, I don't 
know what happens next, whether there is going to be some kind 
of pay-go difference with our bill. It comes back to our 
Senate, and as Senator Voinovich will attest to, nothing comes 
easy over there. It is going to be more time and more time and 
more time.
    So I now gave Mr. Foss, poor guy, all of the California, I 
gave them all of the California representatives here. And in 
the hopes that the California folks from AGC could get on the 
phone. You have all day tomorrow. Well, all day today to get it 
done. I think if they hear that all of our States are in 
trouble if we don't do this year extension, we should get the 
votes.
    I want to say to all of you my deepest thanks. This is the 
first hearing on our way to a 5-year bill. We are very excited 
about it on both sides of the aisle, and we couldn't have had a 
better first day. Thanks to all of you.
    And we stand adjourned.
    [Whereupon, at 11:35 a.m. the Committee was adjourned.]

                                 [all]