[Senate Hearing 111-1181]
[From the U.S. Government Publishing Office]





                                                       S. Hrg. 111-1181

                 THE NEED FOR TRANSPORTATION INVESTMENT

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



                                HEARING

                               before the

                              COMMITTEE ON
                              
                      ENVIRONMENT AND PUBLIC WORKS
                      
                          UNITED STATES SENATE

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 25, 2009

                               __________

  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
                     
                             FIRST 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

                              ----------                              
                                                                   Page

                             MARCH 25, 2009
                             
                           OPENING STATEMENTS

Boxer, Hon. Barbara, U.S. Senator from the State of California...     1
Bond, Hon. Christopher S., U.S. Senator from the State of 
  Missouri.......................................................     2
Cardin, Hon. Benjamin, U.S. Senator from the State of Maryland...     4
Inhofe, Hon. James M., U.S. Senator from the State of Oklahoma...     6
Baucus, Hon. Max, U.S. Senator from the State of Montana.........     8
Barrasso, Hon. John, U.S. Senator from the State of Wyoming......    11
Lautenberg, Hon. Frank, U.S. Senator from the State of New Jersey    12
Voinovich, Hon. George V., U.S. Senator from the State of Ohio...    13
Klobuchar, Hon. Amy, U.S. Senator from the State of Minnesota....    14
Specter, Hon. Arlen, U.S. Senator from the State of Pennsylvania.    16
Merkley, Hon. Jeff, U.S. Senator from the State of Oregon........    18
Sanders, Hon. Bernard, U.S. Senator from the State of Vermont....    18
Udall, Hon. Tom, U.S. Senator from the State of New Mexico.......    19
Gillibrand, Hon. Kirsten, U.S. Senator from the State of New 
  York, prepared statement.......................................    17

                               WITNESSES

LaHood, Ray, Secretary, U.S. Department of Transportation........    20
    Prepared statement...........................................    23
    Responses to additional questions from:
        Senator Udall............................................    32
        Senator Inhofe...........................................    39
        Senator Voinovich........................................    43
    Response to an additional question from Senator Bond.........    47
Rendell, Edward G., Governor, State of Pennsylvania..............    57
    Prepared statement...........................................    61
    Responses to additional questions from:
        Senator Carper...........................................    67
        Senator Inhofe...........................................    70
    Response to an additional question from Senator Voinovich....    72
Novak, Kathleen M., President, National League of Cities; Mayor, 
  Northglenn, Colorado...........................................    73
    Prepared statement...........................................    76
    Responses to additional questions from:
        Senator Carper...........................................    81
        Senator Inhofe...........................................    84
        Senator Voinovich........................................    86
    Response to an additional question from Senator Bond.........    89

 
                 THE NEED FOR TRANSPORTATION INVESTMENT

                              ----------                              


                       WEDNESDAY, MARCH 25, 2009

                                       U.S. Senate,
                 Committee on Environment and Public Works,
                                                    Washington, DC.
    The full committee met, pursuant to notice, at 10:10 a.m. 
in room 406, Dirksen Senate Office Building, Hon. Barbara Boxer 
(chairman of the Committee] presiding.
    Present: Senators Boxer, Barrasso, Baucus, Lautenberg, 
Inhofe, Voinovich, Bond, Cardin, Carper, Klobuchar, Sanders, 
Gillibrand, Udall, and Merkley.

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

    Senator Boxer. Good morning, everybody. Sorry it is running 
a little late. I was on the floor this morning, the Senate 
floor. Today's hearing focuses on the need for transportation 
investment as we move forward with the next highway transit and 
highway safety authorization.
    The current legislation, SAFETEA-LU, will expire on 
September 30, 2009. The new bill, we are calling it MAP-21, 
Moving Ahead for Progress in the 21st century. This legislation 
will impact all Americans because it sets the policy and 
provides the funding for transportation nationwide and this 
Committee will be taking the lead to authorize the new 
legislation.
    We held several hearings in the 110th Congress on issues 
including bridges, goods movement, safety and the Federal role 
in transit. I also held field hearings in several California 
cities to hear directly from my constituents on their ideas for 
a new bill.
    At this time, I would ask unanimous consent that all the 
statements which were submitted as part of my California field 
hearing be inserted in the record. Without objection.
    [The referenced material was not available at time of 
print.]
    Senator Boxer. We will continue to hold hearings, meetings 
and listening sessions to make sure all points of view are 
considered. We continue to hear loud and clear that the need 
for investment is great.
    Congress passed and the President recently signed into law 
the American Recovery and Reinvestment Act of 2009, H.R. 1, 
which provided a total of $48 billion for transportation 
improvements. Of that $48 billion, $27.5 billion was included 
for the highway program. These funds are currently being used 
to improve our Nation's infrastructure and are already creating 
jobs, and the Committee does plan to oversee the use of those 
funds informally and formally.
    The funding provided in H.R. 1 was a good start, but 
certainly not enough. We must have continued investment to 
maintain these jobs and make additional needed improvements to 
our infrastructure.
    The National Surface Transportation Policy and Revenue 
Study Commission, which released a congressionally mandated 
report in January 2008, called for investments of up to at 
least $225 billion annually over the next 50 years at all 
levels of government to bring our existing surface 
transportation infrastructure to a good state of repair and to 
support our growing economy.
    All combined, our States, our cities and the Federal 
Government are spending 40 percent less than that amount. The 
more recent February 2009 report of the National Surface 
Transportation Infrastructure Financing Commission estimates 
that we need to invest at least $200 million per year at all 
levels of government to maintain and improve our highways and 
our transit systems.
    According to the U.S. Department of Transportation's 2006 
Conditions and Performance Report, the costs at all levels of 
government to maintain our current highway system is $78.8 
billion a year. That is just to maintain, while the costs to 
improve the system would be $131 billion per year. The same 
report shows that the backlog of needed improvements to simply 
maintain the current highway program is $495 billion.
    Today's witnesses will further highlight the need for 
investment in transportation at the Federal, State and local 
level. I appreciate each of the witnesses because they took 
time out of their busy schedules to be with us today, and I 
look forward to hearing their testimony.
    I would like to give a very special welcome Secretary 
LaHood who is making his first appearance before this Committee 
as the Secretary of Transportation. I appreciate his being here 
today and I look forward to working with him and all of my 
colleagues on both sides of the aisle on MAP-21.
    And we are very happy to have Governor Rendell with us, and 
Mayor Novak, who will be on the next panel, on the final panel.
    So at this time, I am happy to turn it over to Senator 
Inhofe for his opening statement.
    Senator Inhofe. Thank you, Madam Chairman.
    I would like to defer my opening statement to Senator Bond, 
who has a conflict, and if you could wind me back into the 
system after that.

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

    Senator Bond. Thank you very much, Madam Chair.
    Senator Inhofe, I very much appreciate it. Unfortunately, I 
do have another hearing I have to attend, but this hearing is 
an extremely important opportunity to examine the 
transportation investment needs throughout our system, and also 
to develop a proper transportation infrastructure that fosters 
economic development and produces the greatest return to 
taxpayers.
    I thank all the witnesses for appearing today. Your 
perspectives will give us a unique glimpse into our Nation's 
transportation needs at the local, State and Federal levels, to 
give us a more accurate understanding of our system's 
deficiencies, develop a better insight into how transportation 
dollars are best spent, and examine how all of these needs can 
come together to move our Country forward.
    It needs to be said again and again that quality 
infrastructure connects people and communities with one 
another. It is this connection that attracts and sustains 
businesses, jobs, and high quality of life for our 
constituents.
    One of the toughest questions that we are going to face is 
funding for the Federal Highway Trust Fund. As we all know, the 
decline in road miles has really hurt that fund. I was very 
disappointed that we could not add in the stimulus bill a 
withdrawal of the rescission scheduled for September 30 of this 
year; $8 billion, that is $8 billion worth of work that would 
be under way that will be cut off if we are unable to deal with 
that in the time between now and then.
    In my home State of Missouri, we have seen a significant 
improvement over the last decade, but obviously, like all 
States, we have a long way to go. We are maintaining our 
current infrastructure better. We have seen the major 
percentage of our major highways in good condition, go from 47 
percent to 83 percent over 4 years. Structurally deficient 
bridges have decreased by 5 percent over the same time period.
    That being said, obviously there is a lot of work yet to be 
done. We have made great strides, but to continue forward we 
must make investments to bring our infrastructure up to speed.
    There is a growing concern in Missouri in the capacity of 
the system. We are at the crossroads of the Nation, right in 
the middle of the Country. Traffic north, south, east and west 
goes through our State. We are beginning to bust at the seams. 
Our vehicle miles traveled are at historic highs. Congestion 
rates are up, with more and more Missourians and interstate 
travelers tied up in traffic next to truck carrying products 
that are necessary for commerce.
    Congestion is a real problem. It is taking an economic toll 
at a time when we simply cannot afford more burdens on our 
system. Moving forward, we have to invest more in good roads, 
but we cannot rely on roads alone. We have to look toward rail 
and river transport as efficient ways to move goods and ease 
checkpoints. River transportation is the most economical 
energy-efficient, and environmentally friendly way of 
transporting large commodities. We have to start to think in a 
comprehensive manner that stresses flexibility of one entire 
transportation system, rather than just the separate several 
ones.
    There will be a tendency just to throw money at it, but we 
remember that it won't necessarily fix our problems. We have to 
be diligent in creating an authorization bill that makes 
infrastructure investments in a wise way, and provides 
taxpayers a good return.
    One issue that could have an enormous impact on our needs 
for transportation investment return is project delivery time. 
And we worked with the Department of Transportation in the past 
and look forward to guidance on this in the future.
    As we speak, the cost of transportation projects across the 
Country are increasing, while contractors, municipalities, and 
State DOTs wade through the mass of bureaucracy that is our 
current project development process. Simply put, we cannot 
afford to continue down the path of 10 to 15 year delivery 
times for transit and highway projects. It doesn't take a 
mathematician to figure out such an impediment means project 
costs doubling or tripling, for congested highways, decreased 
productivity, and compromised road safety.
    We have difficult decisions before us, Madam Chair, but 
understanding both the challenges ahead and establishing a 
clear path can make those decisions more informed and more 
effective.
    Thank you, Madam Chair, Senator Inhofe, Senator Baucus, 
Senator Voinovich for your hard work. And I look forward to 
hearing perspectives from our witnesses and from you on how 
together we can craft a new authorization bill that will move 
us forward in solving our infrastructure needs, and thus our 
economic needs.
    Thank you, Madam Chair.
    Senator Boxer. Thank you so much.
    We are so fortunate on this Committee we have so many 
senior Members of the Senate, and you know, not the least of 
which is the Chairman of the Finance Committee. We are so 
fortunate because we have to work so closely with the Finance 
Committee as we move forward.
    Here is the order of arrival on the Democratic side: 
Cardin, Baucus, Lautenberg, Klobuchar, Merkley. So if there is 
no disagreement, I will call you in that order.
    And on the Republican side would be Inhofe, Barrasso and 
Voinovich, if that is OK.
    So we will hear from Senator Cardin.

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

    Senator Cardin. Thank you very much, Madam Chair. And let 
me thank you for holding this hearing.
    I would ask unanimous consent that my entire opening 
statement be placed in the record.
    Senator Boxer. Without objection.
    Senator Cardin. And I want to just underscore some brief 
points.
    There is no question that our national transportation 
system is in dire need of repairs and investments. We have 
heard the dollar amounts of what it would take in order to get 
our transportation infrastructure up to date. But let me just 
share with you the frustration of motorists in the Washington 
area and the Baltimore area. I commute every day between 
Baltimore and Washington, so I see first hand the frustration 
of motorists and those who are trying to commute back and forth 
to work.
    It has been estimated that we spend 4.2 billion hours a 
year stuck in traffic. That translates to about $78 billion 
lost to our economy and 3 billion gallons of fuel wasted every 
year. So this is a huge issue, a huge challenge for America, to 
try to get this right, to invest in our transportation system.
    I think the American Recovery and Reinvestment Act was a 
good first start. It provided significant investments in 
transportation in the right way for our Country. It provided 
$48 billion of investment in transportation, and did it in a 
way that will be friendly toward energy independence and toward 
our environment.
    So I think our challenge, Madam Chair, is to craft the 
Surface Transportation Reauthorization Act, that you referred 
to as MAP, that will meet our investment needs in a fiscally 
responsible way. That means it is nice to talk about the dollar 
amounts that we need, but let's talk about how we are going to 
pay for it.
    And I understand that Senator Baucus is here and he has 
probably the greatest burden of any of us as Chairman of the 
Finance Committee. I know it is not easy to figure out how we 
can do what we need to do in our economy, without jeopardizing 
our economic growth. But I think we need to make sure that what 
we do in the Surface Transportation Reauthorization Act is 
consistent with our overall responsibility to balance the 
Federal budget and I hope that we will take up the revenues as 
part of the way that we go about a realistic reauthorization 
bill.
    Second, I think we need to make sure that this is done in 
an environmentally friendly way. We talk about that, but 
transportation can play a huge role in reaching our goals on 
our responsibility to future generations toward our 
environment. This Committee has heard me talk frequently about 
public transportation, and how our investments in public 
transportation will help us deal with energy independence, will 
help us deal with reducing greenhouse gases, will help us deal 
with quality of life.
    I think these are important points and need to be part of 
the policies that we look forward to in our next effort on 
reauthorization.
    And let me just mention another area where I think we can 
make incredible progress on our environment, and that deals 
with the quality of our water. The way that we do 
transportation construction can have a major impact on runoff 
issues and quality of water in this Country, which is another 
coordinated policy that I hope we will use as we look at the 
reauthorization.
    So yes, it is critically important that we make the right 
investments. And my colleagues will be giving numbers of how 
America is behind the rest of the world in the investments that 
we make, the public investments we make generally, as well as 
what we make in transportation. And we need to increase that. 
We need to increase our investment for our future.
    But let's make sure it is not done in tunnel vision, that 
our only priority is to see how many roads we can build. Let's 
take a look at the overall problems that we have in America in 
dealing with quality of life and our commitment to our 
environment, our commitment to energy independence. And if we 
get this right, I think we truly will be making the right 
investments for America's future.
    I look forward to hearing from our witnesses today, and I 
really do look forward to the work of this Committee in giving 
constructive suggestions, along with our President, to meet 
these goals.
    [The prepared statement of Senator Cardin follows:]

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

    Madam Chairman, thank you for holding this hearing today.
    Our Nation's surface transportation system is in desperate 
need of repair while being stretched to its limits. As a 
consequence there have been increasing expenses to motorists 
and commuters in terms of operating costs and lost time due to 
congestion.
    As anyone who drives in the Washington, DC, or Baltimore 
area knows, we have an extraordinary problem with congestion 
and it's getting worse. Americans spend 4.2 billion hours a 
year stuck in traffic, at a cost of $78 billion a year to the 
economy and nearly 3 billion gallons of wasted fuel.
    At the urging of the Obama administration, we enacted the 
American Recovery and Reinvestment Act (H.R. 1) earlier this 
year. It contained a major infusion of transportation funding: 
$48 billion overall with $27.5 billion for the highway program.
    In Maryland, we provided $431 million for highway 
infrastructure investments. The State also received $179 
million for transit capital assistance and $15 million for the 
fixed guideway modernization program.
    All across my State of Maryland, these transportation 
dollars were greeted with enthusiasm--and a request for more. 
The funding we provided merely put a dent in the enormous 
backlog of transportation needs in this country.
    Maryland is actively pursuing additional Federal funding 
through the competitive grants programs established in the 
Recovery bill.
    In 2007, Dr. Jay Mandle, a Professor of Economics at 
Colgate University, published a brief article in which he 
analyzed the fraction of the Gross National Product that 
represents our public investment in non-defense structures and 
equipment: bridges, roads, wastewater treatment plants and the 
like.
    Taking data from 1960 to 2005, Professor Mandle found that 
the Nation had a public investment rate that has been in 
constant decline from a high of 0.430 in 1980 to 0.299 in 2005.
    Less than three-tenths of 1 percent of our GDP is being 
invested in our non-defense public structures and buildings. 
What is even more remarkable is the fact that--not including 
the Recovery funds enacted last month--this level of investment 
is the lowest it's ever been in the 45 years that Professor 
Mandle analyzed.
    The price tag associated with addressing these critical 
needs is measured in the hundreds of billions of dollars. Total 
current spending is well below what is needed to improve the 
condition of our national transportation infrastructure. As we 
will learn today, investments in infrastructure are required 
for the U.S. to remain competitive in our global economy.
    I hope today's witnesses will go beyond a recitation of 
needs and instead focus on two aspects of how we meet those 
needs in the coming years.
    1. Roads, rails and runways don't pay for themselves. Who 
will foot the bill, and how will they secure the funds they 
need to get the job done?
    2. What ideas do our witnesses have that will deal with our 
infrastructure needs in a holistic fashion? Roads and bridges--
yes, of course, but what about light rail . . . rapid bus . . 
.freight rail . . . intermodal ports . . . airports. We need a 
truly integrated transportation system that breaks down the 
barriers not only at our DOTs but also here in Congress where 
different committees share jurisdictions.
    As this debate moves forward, we will need to focus on 
other key issues besides financing and program integration. We 
will need to reduce greenhouse gas emissions from the 
transportation sector, generally work to improve air quality, 
and also address the polluted stormwater runoff from our 
highways. We face critical challenges. I look forward to 
hearing from today's witnesses as we begin the dialog about how 
we transform our transportation infrastructure for a 
sustainable, economically viable future.
    Thank you, Madam Chairman.

    Senator Boxer. Thanks, Senator, very much.
    Senator Inhofe.

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

    Senator Inhofe. Thank you, Madam Chairman. We all 
appreciate the opportunity to get into this thing. We have 
talked about it now since we saw the expiration coming. This 
will be my fourth reauthorization. My first one was when I was 
serving in the House, so it is something that I am very, very 
much concerned about.
    There is a direct link between a robust economy and a 
strong transportation infrastructure, and that is one of the 
problems we are having right now. We started this system way 
back in the Eisenhower days, relying on the proceeds, the 
revenues from the gas tax, and this just really hasn't worked.
    I think that today the witnesses that we have, Governor 
Rendell, I remember meeting you up in Philadelphia when we, not 
that you were attending the Republican Convention, but we were 
up there together.
    [Laughter.]
    Senator Inhofe. And Ms. Novak, it is nice to have you here.
    And of course, I called up the President when he nominated 
Ray LaHood to be the Transportation Secretary. And I said, this 
is by far the best nomination that you have made, and then I 
thought afterwards, am I destroying his career? So I am glad to 
see you made it through confirmation and just look forward to 
continuing to work with you.
    As I mentioned, the Highway Trust Fund has always had 
surpluses until just recent years. And this is something that 
is very difficult to deal with because others noticing the 
surplus, they started hitchhiking, putting different things 
that were not really roads and bridges, and other interests in 
there, because the money was there.
    And I can remember back in 1998 when then-President Clinton 
took a very large amount of money, $9 billion, out of the 
Highway Trust Fund and put it back into the general fund. And 
it was 10 years later that we were able to get that reversed 
back over. So we have to be kind of patient with these things.
    Nonetheless, we have greater needs, and we are going to 
have the money in the conventional sources to get it done. 
While the Chairman and myself philosophically differ on a lot 
of things, we are together, and it really bothers people how 
much we like each other when we talk about transportation.
    [Laughter.]
    Senator Inhofe. But we tried. We tried to put an amendment 
on the stimulus bill to triple the amount of money that would 
have gone. Out of $787 billion, only $27 billion was going to 
go to this cause, 3 percent. And that is not adequate. We tried 
to triple that amount and were unsuccessful in being able to 
get the bill up.
    So I think, and I will wait to hear from Senator Baucus on 
this, I think we are going to have to get a little more 
creative. If we are going to be able to do what we have to do, 
it is going to be close to $400 billion to $500 billion to do 
the job that needs to be done.
    I know in my State of Oklahoma, I notice that the Senator 
from Missouri had to leave, but he used to be dead last in 
terms of the condition of the bridges in his State. Now, my 
State of Oklahoma is dead last. And we want to do something 
about that. We have that obligation. So we are going to get 
together. We have had several Big Four meetings and we are 
going to try to get this done.
    And as I say, Madam Chairman, we tried. We talked about 
this for so long now, about whether it is a VMT or what we have 
to do to deviate from what we have done for the last 50 years, 
but we are going to have to do something. So let's get 
creative.
    [The prepared statement of Senator Inhofe follows:]

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

    Thank you, Chairman Boxer. I appreciate the opportunity to 
examine the investment needs of our Nation's transportation 
system. This next bill will be my 4th authorization, and I 
believe the challenges in continuing to provide a safe and free 
flowing transportation network have never been greater. I am 
sure our witnesses will agree that our Nation's transportation 
needs outpace our current investment levels.
    The link between a robust economy and a strong 
transportation infrastructure is undeniable; yet when it comes 
to other spending priorities in the Federal Government, 
transportation is often neglected. We cannot continue to rely 
on investments made over 50 years ago.
    Since the Highway Trust Fund has historically maintained 
high balances, it has become a favorite funding source for all 
surface transportation activities, all while maintaining the 
highway users as the only revenue stream into the fund. As this 
Committee addresses growing infrastructure investment needs, 
with limited resources on hand, we will need to be bold in re-
evaluating our highest national transportation priorities.
    I was disappointed that the Stimulus Plan signed last month 
provided less than 7 percent of spending for all classes of 
infrastructure, and highways was only about 3 percent. This 
level of funding for highways in an economic stimulus bill is 
unacceptable, as it largely ignores the immediate job creation 
and economic growth associated with infrastructure investment. 
In response to this insufficient level of investment, Senator 
Boxer and I worked together to craft an amendment, that it if 
had successfully been added to the package, would have provided 
an additional $50 billion for highways, transit and clean and 
safe drinking water, without increasing the size of the bill. 
Unfortunately, this was blocked.
    It is important to note that the $27.5 billion for highways 
in stimulus is no way a substitute for the hundreds of billions 
needed to address our Nation's infrastructure crisis. In fact, 
the U.S. Department of Transportation calculates that the 
backlog of projects needed to simply maintain our Nation's 
current highway and bridge network is $495 billion and growing.
    As we wait for a re-authorization proposal to emerge from 
the Administration, I would encourage President Obama to 
prioritize the transportation needs of this Country. Now more 
than ever, we cannot afford to ignore the needs of our aging 
highway network.

    Senator Boxer. Thank you so much, Senator. And you 
certainly speak for me. We are partners on this effort, and it 
is a very good thing for the Country, I think.
    Senator Baucus, we are thrilled you are here.

             OPENING STATEMENT OF HON. MAX BAUCUS, 
             U.S. SENATOR FROM THE STATE OF MONTANA

    Senator Baucus. Thank you, Madam Chairman, and thank you 
for calling this hearing on needs.
    Clearly, we have many needs for our transportation system. 
One definition of need is in Webster's Dictionary, and I quote 
it, I repeat it here. It is ``a lack of something requisite, 
desirable or useful.''
    Transportation infrastructure has always been requisite, 
desirable and useful to our economic growth and our national 
security. Whether it was Treasury Secretary Albert Gallatin 
building the first National Road at a cost of about $13,000 per 
mile, which was a staggering sum for a Country steeped in debt 
in 1911, or it was the 1862 passage of the Pacific Railway Act 
that connected the Missouri River to the Chairman's home State 
of California, or it was the first authorizing legislation for 
Federal highways, such as the Federal Aid Road Act of 1916 and 
the Federal Aid Highway Act of 1921.
    All of these things and others have combined to make our 
Country the safest and most prosperous place on earth. And we 
can still see the fruits of those efforts. As Governor Rendell 
might know, Gallatin's National Road runs close to southwestern 
Pennsylvania. It is today called U.S. Route 40. The President 
who led the passage of the Pacific Railway Act was Lincoln, 
from Secretary LaHood's home State of Illinois. And his efforts 
resulted in what we now refer to as the Union Pacific Railroad. 
And our current interstate network is based on maps developed 
as far back as that 1916 authorizing legislation.
    My State of Montana depends on Federal infrastructure, 
deeply, especially on Federal investment in infrastructure. We 
are a vast rural State. We have more Federal miles per capita 
than any State in the Nation. However, we have a smaller 
population, with one of the Nation's lowest rates of per capita 
income. Back after World War II, Montana ranked 10th in the 
Nation in per capita income. We now rank about 48th or 49th in 
per capita income: big State, lots of highways, low income.
    That makes it difficult to meet the needs by ourselves, 
although we are on the top one-third in the Country in State 
gasoline taxes. Like many other nearby rural States, Montana 
serves as a key bridge State for freight movements moving 
through the State. Montana is 10th of all the States in terms 
of interstate miles. However, nearly half our primary roads are 
nearing the end of their 50-year design life.
    And Montana is not alone. Other rural States such as Idaho, 
Wyoming, Vermont and New Mexico also have needs that can only 
be addressed through a national highway program.
    And finally, it would be very easy to just focus on urban 
needs, to the detriment of rural needs. And that is one of the 
major concerns, although I have several, with the ideas that 
some people have, such as the national infrastructure bank. I 
fear that a national infrastructure bank will serve urban areas 
at the expense of rural. And I am afraid that a lot of money in 
a national infrastructure bank, again proposed by some, would 
go to fund non-transportation matters, such as urban water 
treatment systems and public housing, rather than addressing 
our highway, bridge and road needs.
    Instead, I think that bank idea will rob the future growth 
of the highway program. And that will destroy the national 
scope of our highway program. The key strength of our highway 
program is it is national. The interstate program is based on 
the premise that we are one Country. It links the various parts 
of our Country together. Some can pay for highways more easily 
than others. Rural States clearly cannot.
    And I also want to point out that we have lots of financing 
mechanisms to pay for surface transportation. The mechanism is 
not the problem. The problem is the funds. It is the money that 
flows through those mechanisms. So we don't need new mechanisms 
if we don't have the money. That is why I urge all of us to 
figure out ways to make this surface transportation program 
really work and address future needs.
    I have sometimes mentioned, probably ad nauseam to many of 
the Members of this Committee, how a couple of years ago when I 
was in China, I got off a plan in Chongqing, China, to say 
nothing of Shanghai and other parts of China. But just go to 
Chongqing. Fly to Chongqing, a wonderful, big new airport, a 
fancy big airport.
    When I arrived there, the counsel over in Chongqing met us, 
and he is very angry. He said, why couldn't Americans help 
build this airport? Why couldn't American engineers help build 
this airport? It was German, and other engineers, that were 
there.
    Then we got in the car and drove on the highways. I could 
not believe it. The best, fanciest interstate highways I have 
ever seen. They are better than those in the U.S., nice big 
ribbons going through Chongqing. Chongqing is nearly 33 million 
people, and that is just one part of China. That is just one 
part.
    And there are many other parts of the world that are 
building wonderful infrastructure programs. Not to talk too 
long here, but as an example here. Several years ago, I was 
meeting with the Business Roundtable here on Capitol Hill. We 
were just trying to figure out what is it that gets our Country 
moving again in terms of infrastructure, gets it going again. 
This Country response to crisis. We responded to Pearl Harbor. 
We responded to Sputnik. We respond to crisis.
    The trouble is that the competitive crisis we are facing 
from competitive pressures overseas is not well defined. It is 
not like a Sputnik. You can't see it in the sky immediately, 
nor is it like Pearl Harbor or the Great Depression, when we 
did respond to a crisis.
    But there is one fellow who was in the room here, who was 
the CEO of a major railroad. He said, Senator, I have seen 
Sputnik. Sputnik is the Shanghai Harbor. All of you should go 
to Shanghai if you haven't already. Look at that harbor. Look 
at the massive infrastructure spending. China is undertaking up 
to date, modern. It far surpasses that of the United States, 
far surpasses.
    I have been in Vietnam not too long ago. Vietnam has built 
a huge, huge seaport. It is going to rival Singapore and Hong 
Kong. And I have been to Dubai. Dubai is doing the same thing 
in both air and sea transportation, a big hub, brand new 
airport, and a brand new port.
    So I am saying, Madam Chairman, and I will stop here, that 
we have to in the United States get our act together and 
address infrastructure in a big way. We can't just authorize 
another highway bill. We have to big time figure out a way to 
reauthorize a transportation system with many new funding 
mechanisms and relying basically upon the current highway 
system because that is a formula which allocates dollars to 
States and gets away from big political fights that would 
otherwise occur in an infrastructure bank. Frankly, a bank is 
just for project deals. It is not for a system approach.
    So I just urge us to keep our eye on the ball and get a 
very good transportation system program passed.
    Thank you.
    Senator Boxer. Well, Senator Baucus, I know hectic you are 
and what is on your shoulders. I really want to thank you so 
much. I will take just 60 seconds or less to say that your 
being here today is very important, and your message and your 
challenge to us is equally as important.
    The public should know that for the last, well I would say 
6 months, even before the election, we were meeting, the four 
of us who will deal with this as a first shot. The rest of the 
Committee will soon enter the negotiations.
    We have been looking at all of the possibilities that have 
been laid out by the various commissions on how to do what 
Senator Baucus says, which is to look at how we are going to do 
this in the future.
    I think that statement about I have seen the new Sputnik 
and it is public works, that we are falling behind. It is a 
brilliant point. It does challenge us.
    And I know, Senator Voinovich, if I could maybe say 
something about you, sir. You know, Senator Voinovich, a senior 
member of our Committee who is now part of the Big Four has 
said to me that he wants to solve this problem because, as you 
know, he comes from State government. We have to do our share. 
The States have to do their share, but we can't do our share 
with an ever-dwindling Highway Trust Fund.
    Now, President Obama at first in the budget took this whole 
trust fund idea and basically said it is not working, and we 
don't accept that. We are going to make sure that there is a 
stream of funding.
    So I guess what I want to say is my commitment is to 
everything in my power, working with my friend, Jim Inhofe. We 
are going to look at, along with Senator Baucus, Senator 
Voinovich and every member of this Committee, ever idea that 
has come before us. And we welcome more ideas.
    I say to our panelists as they come up, because this is our 
challenge, and we cannot walk away from it because we would be 
walking away from the future, and none of us wants to do that.
    So it is my pleasure now to call on Senator Barrasso. I 
know colleagues have to run off to other places, but your words 
will not be lost on us.
    Senator Barrasso.

           OPENING STATEMENT OF HON. JOHN BARRASSO, 
             U.S. SENATOR FROM THE STATE OF WYOMING

    Senator Barrasso. Thank you very much, Madam Chairman.
    Thank you, Senator Inhofe.
    Thank you, Mr. Secretary, for being here. I enjoyed 
visiting with you prior to this hearing.
    I also want to thank you, Madam Chairman, for trying to get 
Governor Freudenthal of Wyoming to testify, and I request that 
you do invite him in the future, because just as Senator Baucus 
has just testified, there are huge issues in terms of the rural 
States, great miles and long miles and not many people in 
between.
    So as we look forward to this new highway reauthorization 
bill, it is important that this Committee and Congress not lose 
sight of the importance of a national interconnected system of 
highways that includes access for rural America.
    Both Wyoming and Montana are bridge States, as Senator 
Baucus has mentioned, and these are States that allow the flow 
of commerce to move from coast to coast. The great majority of 
the truck traffic in the States of Montana and Wyoming doesn't 
originate in those States, doesn't terminate in those States, 
but yet they travel through, and it is those large trucks for 
which we must make sure that the roads are maintained for the 
trucks and the national commerce, not just for the folks that 
live within the States.
    So we must ensure that the next highway bill enables 
transportation between major cities by connecting rural areas 
with well-maintained roads.
    Mr. Secretary, as you know, you can't drive from Illinois 
to the Chairman's home in California without driving across 
Wyoming and Interstate 80. So again, I want to thank you for 
coming up here to testify and I look forward to your testimony 
today.
    Thank you, Madam Chairman.
    Senator Boxer. Thank you.
    Senator Lautenberg, we are so happy you are here, such a 
leader on this. Welcome.

        OPENING STATEMENT OF HON. FRANK R. LAUTENBERG, 
           U.S. SENATOR FROM THE STATE OF NEW JERSEY

    Senator Lautenberg. Thank you.
    Coming from the State of New Jersey which is the most 
densely populated State in the Country, you can pre-determine 
my interest in transportation.
    Secretary LaHood, good to see you here. We continue to have 
discussions along the way and we are happy that you have your 
heart, as well as your mind, in investments in transportation.
    I focus a lot on rail, but highways and air are all 
necessary places for attention.
    Each year, we need $250 billion just to meet our Country's 
transportation needs, according to a Federal commission. And 
yet, we are investing less than half of that amount. Now is the 
time to change our priorities and our plans for the future. Now 
is the time, despite the hardship, the economic hardship that 
we face as a Country, for a policy that will renew and vitalize 
our transportation infrastructure because it will create jobs, 
reduce congestion, reduce our dependence on foreign oil, and 
fight global warming.
    First, America needs more not only passenger rail service, 
but to expand our freight rail systems as well. Goods move more 
efficiently, people and goods, on rail than they do on 
congested highways. Amtrak, for instance, saw ridership hit 
historic records last year, and that was the sixth straight 
year in a row that ridership on Amtrak increased.
    As a user of the Acela train, I find out that airplanes 
seem to be getting slower. It takes longer to get where you 
want to go on an airplane these days. Last Thursday night, I 
went to the airport. To get a train to the New York area, I can 
fly either to New York or New Jersey because I am mid-point 
between there on the Jersey side. And I got on an airplane, 
6:30 flight, shuttle, to LaGuardia Airport. They closed the 
door on the airplane, and almost concurrent there was an 
announcement by the pilot who said, I am sorry to tell you we 
have a 2-hour wait. That was just after announcing flying time 
was 40 minutes, a 2-hour wait. They have to get better 
airplanes.
    Anyway, to see Governor Rendell, our distinguished Governor 
of our neighboring State here, and see what progress he has 
made in the State of Pennsylvania with a new line that he was 
very happy to talk to me about some time ago, and the success 
of that line. I guess Philadelphia to Pittsburgh has been 
eminently successful.
    Getting cars off the road, getting people onto trains saves 
time, money, and energy. Last year, we passed a law that I 
wrote to revolutionize Amtrak and passenger rail. Combined with 
new funding in the economic recovery law, it will lead to more 
reliable service and major improvements in rail service 
throughout the Country.
    And as an aside, if we make the updates, the changes that 
we need for high speed rail, we will relieve significantly the 
congestion in the skyways. One out of four flights that take 
off today, as determined by 2007, one in four flights was late. 
And if we can get more people on the trains for shorter 
distances, we can improve conditions even up in the air.
    Second, we need transit options for our commuters, from 
subways and buses to commuter trains. More people are riding 
America's public transit options than ever before. In 2008, 
Americans showed the highest ridership in 52 years. Mass 
transit reduces our dependence on foreign oil, relieves stress, 
and congestion on our already crowded roads and bridges, and 
save commuters money on gas and other costs associated with 
commutation by car.
    And third, we need to repair our highway infrastructure. We 
heard it from Senator Baucus just now about how countries far 
less advanced, far less developed than we have improved their 
highway systems. He talked about China in particular. A 21st 
century economy cannot be built on collapsing bridges. Nearly 
25 percent of our Nation's bridges are still deficient. We have 
to be able to repair them to carry the cars, trucks and buses 
that will continue to be part of our transportation network.
    To meet the demands of tomorrow, we need to make major 
changes and commit to investments in our surface transportation 
programs today. This hearing, as was noted, marks the beginning 
of our Committee's work in crafting a new surface 
transportation bill. I sit on the Commerce Committee, as well 
as the Environment Committee. I am Chairman of the Surface 
Transportation Subcommittee here. I welcome the opportunities 
ahead of us. I look forward to working with our energetic 
Chairperson, and my colleagues in the new Administration, to 
rebuild our roads, our tunnels and bridges, while also 
expanding our rail, subways and bus service.
    In the past, this legislation, Madam Chair, has been called 
the highway bill, but our future needs call for a true surface 
transportation bill that encompasses all modes of 
transportation.
    I thank you very much.
    Senator Boxer. Thanks, Senator, very much.
    Senator Voinovich.

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

    Senator Voinovich. Thank you, Madam Chairman. I want to 
publicly thank you for your leadership in getting our staffs 
together to begin to try to make sure that we get this 
transportation bill done on time.
    I experienced two of the transportation bills while I was 
Governor of the State of Ohio, and I am glad that Governor 
Rendell is here and Mayor Novak. I think it is important that 
we have the perspective of both State and local government. And 
I lobbied here as president of your group and as chairman of 
the National Governors, and I think so often your perspective 
isn't adequately heard here.
    You, indeed, are our partners. And I think it is important 
that you emphasize how important it is that we get this done on 
time, because even though we have the stimulus bill, we need to 
know where we are going, not only in terms of our 
infrastructure, but also in terms of the economy.
    I know in my State, and I am glad that the Chairman and the 
Ranking Member encouraged more money in the stimulus bill, but 
my State, we have $2.7 billion worth of shovel-ready projects, 
and we, out of the stimulus bill, got less than $1 billion. So 
the need is there, and I think it is important that we get this 
done on time.
    Second, I think we all know that the National Surface 
Transportation Infrastructure Financing Commission came back 
and said that we need, overall, another $234 billion between 
the Federal Government and the role that State and local 
government plays. I think it is important that we decide what 
the number is, what we are capable of doing, so that there is a 
consensus there. And then the second, just like working with 
your legislators, it is nice if the Governor sits down with a 
legislature and says, here's the budget. Do you guys agree with 
the number? OK, fine. We agree on the number. Then how do we 
get the money to take care of getting the job done?
    So I think that is important, Madam Chairman, that we 
decide on what that number is. And second of all, then, how are 
we going to pay for it. And there is a lot of discussion about 
how we should do it. The thing that, and I know this doesn't 
ring a bell with too many people, but I am absolutely 
surprised, and I met with the Chamber of Commerce people and 
all the other groups that in the past have been just adamantly 
opposed to seeing an increase in the gas tax, and of them 
coming on board and saying this is necessary for us to get the 
job done, understanding that that isn't the sole source of 
revenue, that there are other revenues that will be available 
to us.
    So Madam Chairman, I am just anxious to work with you and 
see if we can get a consensus and move forward and get this 
done on time, and get the money on the street, and put people 
back to work.
    Senator Boxer. Well, Senator, that is music to our ears. It 
think this is one area where we are going to see tremendous 
cooperation. I am so thrilled to see all the attendance here. 
It is slowing us up, so if we can move to 4-minute opening 
statements now, if you can, and if you can't, you can add 
another minute.
    Amy, you can add your other minute if you want.
    Senator Klobuchar.

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

    Senator Klobuchar. Thank you very much, Madam Chairman.
    Thank you to our witnesses, Mayor and Governor. I wouldn't 
have gotten to Washington without having driven on the 
Pennsylvania Turnpike. Thank you.
    Secretary LaHood, who just visited our State with the Vice 
President during the past week. I think you saw that people 
care about transportation not just in densely packed New 
Jersey, but in St. Cloud, Minnesota, where at the town meeting 
I would say they were very results-oriented, especially about 
the route of the rail from Big Lake to St. Cloud. Thank you so 
much for spending the time out there.
    The need for transportation investment in our State, and I 
think you could feel it when you were there. It became 
tragically clear to us when the I-35W bridge collapsed in the 
middle of the Mississippi River, killing 13 people, injuring 
scores of others. And as they said that day, a bridge just 
shouldn't fall down in the middle of America. It was at tragedy 
that shocked our Country and exposed our deteriorating 
transportation infrastructure.
    For far too long, we have neglected our roads and our 
bridges. According to the Federal Highway Transportation 
Administration, more than 25 percent of the Nation's 600,000 
bridges are either structurally deficient or functionally 
obsolete. I think we talked about the bill that Congressman 
Oberstar and I have which mandates that bridge repair money be 
used for bridge repair money, because we found that was an 
issue in our State and others, as there is a natural tendency 
to want to build new bridges and open new infrastructure, when 
in fact some of our infrastructure needs to be fixed.
    It is not just a safety issue. It is also an economic 
issue. Congestion and inefficiencies across our transportation 
network limit our ability to get goods to market. They 
exacerbate the divide between urban and rural America, and they 
constrain economic development and competitiveness.
    Our State is ninth in the Country for Fortune 500 
companies, from 3M to Target to Best Buy to Medtronic to 
General Mills, and our business community actually has been 
very focused on trying to get more transportation funding on 
the State and the Federal level because they see this 
connection. If we are going to move into a 21st century 
economy, we need a 21st century transportation system.
    The Recovery Act, the stimulus package, was a good first 
start toward bolstering our investment in our transportation 
system, but it is just a start. As we have all discussed, there 
are going to be challenges with funding, but we also see this 
as an opportunity. Every billion dollars of highway spending 
creates 35,000 new jobs. And as we have discussed today, it is 
not just about the roads and bridges, and I know you understand 
this from our meeting, rail, rapid transit, high-occupancy 
lanes, pedestrian walkways, other options.
    Smart planning decisions at the local level will also serve 
to broaden options for many Americans, while helping to reduce 
our dependency on foreign oil. Research and innovation, 
something we haven't talked about as much, can stretch our 
transportation dollars even further. IBM in the Twin Cities and 
Rochester, Minnesota is looking to partner with the University 
of Minnesota to examine how advancement in intelligent 
transportation solutions can solve some of our most pressing 
transportation needs.
    So whether it is predicting a traffic jam before it happens 
or using smart cards to provide a paperless transit system, 
public-private partnerships all across America will play a key 
role in leading us into the 21st century.
    So those are some of the things that I am going to be 
focusing on this week and debate this bill. But I want to thank 
you for recognizing, which I clearly saw when you came to 
Minnesota, how important this is to our economy's future.
    Thank you very much.
    Senator Boxer. Thanks so much, Senator.
    Senator Specter, welcome.

           OPENING STATEMENT OF HON. ARLEN SPECTER, 
          U.S. SENATOR FROM THE STATE OF PENNSYLVANIA

    Senator Specter. Thank you, Madam Chairwoman.
    The good news is that there are 10 Senators here to listen 
to you. That is a lot of Senators, considering what is going on 
this morning. The bad news is that everybody is going to speak.
    [Laughter.]
    Senator Specter. But not for too long, at least here.
    But I wanted to come by and pay my respects to the new 
Secretary of Transportation and the longstanding Governor of 
Pennsylvania, two very distinguished public servants tackling 
very, very important issues.
    I am pleased to hear that you were in Minnesota. I know 
that you have been in Pennsylvania. You have probably been in 
all 10 States represented here today. And as the saying goes, 
if you haven't been, you probably will be, and sooner rather 
than later.
    But I appreciate the chance to talk to you on the train 
ride when Vice President Biden came to Philadelphia to join 
Governor Rendell, Senator Casey, me and others on the stimulus 
package and the important needs of our region.
    I am glad to have had an opportunity to discuss those with 
you, Mr. Secretary. And Ed Rendell and Arlen Specter and others 
are going to be following you. And you have a big, big, 
critical, critical, important job, and it applies in two ways. 
One is to make the stimulus package work. And right now, we 
have an America which is not enthusiastic about spending $787 
billion, in fact, very unenthusiastic. Lots of political perils 
for those of us, those few of us, those very few of us who 
voted for it in a certain context, but it is necessary for 
America, and now we have to make it work, and we have to make 
it work to put people to work.
    An early conversation I had with Governor Rendell was how 
fast. And after we negotiated a while, he said, ``as early as 6 
months on a lot of the transportation matters.'' And there are 
big projects on infrastructure, highways, bridges, and mass 
transit. And we have already given you a long list.
    So it is putting people to work and it is also putting 
people to work on very, very important items which will last 
and which will promote economic development.
    As we speak, we have FBI Director Muller in Judiciary, and 
then in another committee, we have former Supreme Court Justice 
Sandra Day O'Connor and others, so I am going to yield back the 
balance of my minute and 9 seconds.
    Thank you.
    Senator Boxer. Senator, thank you for coming.
    And I also wanted to note Senator Gillibrand had to go to 
another committee as well, but she will submit her statement 
for the record.
    [The prepared statement of Senator Gillibrand follows:]

          Statement of Hon. Kirsten Gillibrand, U.S. Senator 
                       from the State of New York

    Thank you, Madam Chairman.
    I want to begin by thanking our witnesses for being with us 
today; in particular, I want to recognize our first witness--
Secretary LaHood.
    Secretary LaHood and I had the pleasure of meeting early 
last week, and I am so thankful for his leadership on the 
critical issues facing our Nation's transportation system.
    I look forward to hearing from the Secretary as well as our 
other witnesses, Governor Rendell and Mayor Novak.
    Thank you all for being here.
    The state of our Nation's infrastructure, as one leading 
advocacy organization has stated, ``is poorly maintained, 
unable to meet current and future demands, and in some cases, 
unsafe.''
    Given the great economic challenges this Nation faces, our 
core infrastructure needs should be seen as an opportunity to 
put Americans back to work, address the issue of global climate 
change, and invest in long-term economic development 
opportunities.
    For States like New York, the numbers illustrate the 
importance of our transportation infrastructure:
      The New York City area is home to nearly one in every 
three Americans that use mass transit.
      In terms of passenger rail, two-thirds of the Nation's 
rail riders reside in New York.
      While 90 percent of Americans commute to work via 
automobile, nearly two-thirds of those who commute to the New 
York City from surrounding areas use mass transit.
    Reducing our dependence on fossil fuels through the 
development of alternative energy vehicles and encouraging the 
use of mass transit systems are critical to our Nation's 
future.
    Investments in our mass transit systems are critical to 
prevent service cuts and further increases in transit fares, 
which will only further burden American families who rely on 
mass transit for their primary transportation needs.
    Congestion issues in our metropolitan areas have a 
significant impact on our economy and our ability to move 
goods.
      By the year 2020, traffic congestion could cost the city 
of Buffalo more than $150 million annually.
      For Rochester, $70 million, Albany, nearly $100 million.
    At research centers like SUNY-Stony Brook's Center for 
Excellence in Wireless & Information Technology on Long Island, 
researchers are developing technology to better measure 
transportation infrastructure usage to aid city planners and 
emergency personnel.
    This type of innovation will save money and save lives.
    The challenge before us is finding the funding mechanisms 
that will meet America's growing infrastructure needs from 
maintaining our critical freight rail systems, developing the 
high speed passenger rail lines of the future, to ensuring the 
safety of our bridges and roads.
    I look forward to working with my colleagues and with the 
counsel of individuals like the distinguished panel that we 
have before us today, to improve our Nation's transportation 
and our ability to move people and goods across this Nation.

    Senator Boxer. So we will turn to Senator Merkley.

            OPENING STATEMENT OF HON. JEFF MERKLEY, 
             U.S. SENATOR FROM THE STATE OF OREGON

    Senator Merkley. Thank you very much, Madam Chair.
    And thank you, Mr. Secretary.
    I can't go to a town meeting in Portland or anywhere in the 
State of Oregon without hearing about transportation issues. So 
there is a great deal at stake here. Certainly, I am interested 
in how our transportation policy and how this bill will affect 
our strategy to fight global warming, our ability to take on 
congestion, and develop livable communities, to improve our 
approach to multi-modal transportation, and to strengthen our 
economies, particularly our rural economies.
    And so I look forward to your testimony.
    Thank you.
    Senator Boxer. Senator, thank you very much.
    Senator Sanders.

          OPENING STATEMENT OF HON. BERNARD SANDERS, 
             U.S. SENATOR FROM THE STATE OF VERMONT

    Senator Sanders. Thank you, Madam Chair.
    Mr. LaHood, welcome, and we look forward to working with 
you. Vermont has not been one of the States that you visited, 
so we want to get you up there. The weather is clearing, I want 
to tell you. We look forward to having you, if we could work 
that out.
    Madam Chair, Congress and this Committee deal with 
enormously complicated issues such as global warming and so 
forth. But the truth of the matter is that transportation and 
infrastructure are not all that complicated. The bottom line 
is, and I say this as a former Mayor, but I think it will not 
surprise anybody, is if you allow your infrastructure to 
deteriorate, year after year after year you don't put funding 
in it, you know what? It is going to get worse; probably will 
not get better. And that is precisely what we have done as a 
Nation.
    And the irony there is it costs more money to rebuild a 
crumbling infrastructure than it does to simply maintain it. So 
we have been really dumb and we have wasted enormous sums of 
money.
    In my State of Vermont, we are one of the smallest States 
in this Country. We need an additional $1 billion over the next 
5 years just to keep our roads and bridges in the same poor 
shape they are in right now. I am embarrassed about the 
condition of our roads and bridges in the State of Vermont and 
I suspect that is true all over this Country.
    So Madam Chair, No. 1, as others have said, we need, the 
American Society of Civil Engineers has estimated that we 
should be investing over $2 trillion in infrastructure. So we 
are going to have a major debate on how we raise that money, 
but we must raise that money, because if we are not investing 
in infrastructure, we are only going to see more deterioration.
    And I hope that every member of this Committee shares the 
embarrassment that when we go to so-called third world 
countries, whether it is China, Vietnam or other countries, we 
are seeing transportation technology that we don't have in the 
United States of America.
    I was in China some years ago. We were going from the 
airport to Shanghai, and suddenly this thing whizzed by. We 
couldn't see it. It was a magnetic levitation train. China. We 
don't have them in the United States of America.
    As I think Senator Lautenberg pointed out, people are 
crowding into airports because we don't have fast rail to get 
from one city to another, et cetera, et cetera.
    So Madam Chair, our Committee has the responsibility for 
not only rebuilding the infrastructure in this Country, but 
also creating millions of good jobs as we do that. You 
understand better than anyone that infrastructure is also 
related in terms of mass transportation to greenhouse gas 
emissions and cutting back on that. So infrastructure ties a 
whole lot of issues together, and I hope very much that after 
years and years of neglect, this Committee will rise to the 
occasion, rebuild our infrastructure, our mass transportation.
    And in that regard, Mr. Secretary, we certainly look 
forward to your leadership and working with you.
    Thank you very much.
    Senator Boxer. Senator, as usual you made it very simple 
and straightforward.
    Senator Udall.

             OPENING STATEMENT OF HON. TOM UDALL, 
           U.S. SENATOR FROM THE STATE OF NEW MEXICO

    Senator Udall. Thank you very much, Madam Chair. And it is 
great having you hold this hearing today.
    And Secretary LaHood, great to see you again. You are a 
great service to our Nation, and your position is very much 
appreciated.
    You know, we know from government studies and reports by 
respected organizations such as the American Society of Civil 
Engineers that much of our Nation's transportation 
infrastructure is crumbling, which was just emphasized by my 
colleague Mr. Sanders. And all of us remember, as Amy Klobuchar 
said, the Mississippi River bridge in Minneapolis collapsing in 
2007.
    In my State, there are over 400 structurally deficient 
bridges, according to the U.S. Department of Transportation. 
This is just one example that illustrates the overall problem 
that exists across the Country.
    It seems to me we face two fundamental challenges with our 
transportation infrastructure. First, much of it was built more 
than 50 years ago. And second, we know today about the dangers 
of global warming and our dependence on foreign oil and we must 
do more to encourage alternatives to automobiles.
    Given the grave transportation infrastructure challenge, we 
need better coordination at State, local and Federal levels, 
and it is great to see Governor Rendell here and Mayor Novak, 
so that you can engage with us in this conversation.
    I am going to focus my questions on the transportation 
needs of my State of New Mexico, but I also am looking forward, 
Governor Rendell, to hear you talk about, and Secretary LaHood, 
talk about this whole issue as we try to develop a 
transportation system that is going to be lower carbon and 
carbon-neutral and move in that direction, what are the wise 
ways to do that? How do we, and I know you are going to talk 
about competitive bids and things like that, but I think it is 
very, very important that as we move forward with 
transportation, we look at the issues of global warming, our 
dependence on foreign oil, and how we move to a low-carbon 
future.
    So with that, because I am very excited about hearing you 
testify, I am going to yield back 1 minute and 46 seconds and 
move forward.
    Thank you, Madam Chair.
    Senator Boxer. Well, that is great.
    Well, finally, I think, if I could just say this. I think 
it is important that so many people came here, so for those who 
are saying why do they want to put their statement on the 
record, I think it is very key and very important that on both 
sides of the aisle, we heard unanimity here. We want to get 
this job done.
    And by the way, you don't hear that on all the issues we 
take up, as you know.
    This is important. And I want to also say the dynamic of 
having Senator Voinovich in his important position as he really 
builds a tremendous legacy in politics, is very, very helpful. 
So you should be complimented, I say to the panel, that so many 
folks wanted to get their ideas out here. It is a signal to the 
public that we are very serious on this.
    So with that, we want to hear from our honored guest, Ray 
LaHood.

    STATEMENT OF RAY LaHOOD, SECRETARY, U.S. DEPARTMENT OF 
                         TRANSPORTATION

    Mr. LaHood. Well, Madam Chair, my statement is not any more 
enlightening that what has already been said. I will be happy 
to suspend with it and go to questions.
    Senator Boxer. Just give us a 5-minute, off the top.
    [Laughter.]
    Mr. LaHood. Then you want me to read it, is that right?
    Senator Boxer. Well, I feel like it is important that we 
know where you are coming from, where the Administration is 
coming from on the highway bill. Then we will go to questions.
    Mr. LaHood. Sure.
    Senator Boxer. I think it is worth taking 5 minutes of your 
time.
    Mr. LaHood. Thank you.
    Chairman Boxer, Ranking Member Inhofe, and Members of the 
Committee, thank you for holding this hearing to discuss 
transportation investment needs.
    Today, I would like to focus primarily on the funding 
required to maintain and improve the condition and the 
performance of our Nation's highway system. America's 
transportation systems are the lifeblood of our economy. They 
allow people to get to jobs and allow businesses to access 
wider pools of labor, suppliers and customers.
    Without efficient transportation routes, economies 
stagnate. We need to protect, preserve and invest in our 
transportation infrastructure to ensure it can meet our present 
and future demands.
    Above all, we must make our roadways safe for all 
travelers. Where public safety is concerned, there is no room 
for compromise. As you know, less than 1 month after taking 
office, President Obama signed into law the American Recovery 
and Reinvestment Act of 2009. The resources made available for 
transportation infrastructure through the Recovery Act are 
significant and a good start on what we need to do to address 
some of the most significant challenges.
    These challenges include: reducing fatalities, mitigating 
the impact of transportation on the environment, improving 
highway and bridge infrastructure, and ensuring mobility in 
transportation choices for travelers in congested metropolitan 
regions. These needs will continue to exist long after the 
recovery funds are expended, and dealing with them will help 
create and preserve many good paying jobs for years to come.
    While we await the release of the 2008 edition of the 
Conditions and Performance Report, which is now being reviewed 
by OMB, we can draw some conclusions about highway and bridge 
infrastructure needs from data published in the 2006 version. 
At the heart of the report is an analysis of future capital 
investment requirements under different scenarios.
    The cost to maintain highways and bridges scenario presents 
the investment required to keep future conditions and 
performance at current levels. The cost to improve highway and 
bridges defines the upper limits of cost beneficial investments 
based on engineering and economic criteria.
    Sharp increases in construction materials costs since 2004 
have substantially increased the costs identified in the 2006 
report. The average annual cost to maintain would now require 
at least $100 billion in investments from all sources. The 
estimated average annual cost to improve level would now equate 
to at least $170 billion.
    While we have seen some improvements in physical conditions 
of roads and bridges, particularly on the NHS, their 
performance has deteriorated, wasting travelers' time and fuel. 
Without renewal and restoration of our transportation 
infrastructure, the system will not be able to support the 
needs of a growing economy.
    The real challenge in addressing the needs I have outlined 
will be the availability of funding at the Federal level. We 
are looking at every option to solve this problem, but it will 
not be ready overnight. The new authorization bill for surface 
transportation programs is one of the highest priorities. We 
will be seeking changes and encouraging more effective 
investments in an environmentally friendly and multi-modal 
approach. Taxpayers want to see results from infrastructure 
investments that directly benefit their lives, better access to 
jobs and goods, and improved mobility within and between 
communities.
    We need an increased focus on measuring the outcomes of 
infrastructure investments such as improved safety, reduced 
congestion, improved pavement and facility life, and better air 
quality.
    Our transportation infrastructure is critically important 
to our Nation's economic health. As this Committee considers 
the next authorization, I ask you to work to maintain the 
safety and integrity of our highways and bridges, while 
improving the overall performance and reliability of our 
transportation infrastructure.
    This must be done in the context of striving toward the 
goal of livable and sustainable communities. This is a tall 
order, but we look forward to continue working with the 
Committee, the States, and our partners in the transportation 
community to succeed.
    Thank you, Madam Chair. I look forward to your questions.
    [The prepared statement of Mr. LaHood follows:]
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    Senator Boxer. Thank you.
    As we work to craft our new bill, our MAP-21, will you be 
available to work with us? Because I think we need your 
expertise. I know that you spoke about vehicle miles traveled 
as a concept, and some folks in the Administration said, well, 
we are not interested in that.
    You know, I guess my question to you is, I hope the 
Administration is open to working with us on every possible 
idea. Senator Inhofe and I have been talking, just here this 
morning, but really for months about this. There are many 
options in terms of how we can get a funding stream that meets 
our needs.
    So I guess my question is, do you believe the 
Administration, despite whatever the back channels were that 
responded to you, do you think they are open to looking at all 
of our ideas and have not put anything off the table? Because I 
think as we meet, we are going to have another meeting today, 
we want to make sure that we are working with you.
    Mr. LaHood. I was at a meeting, which I think would explain 
in pretty good detail, last Friday with Governor Rendell, 
Governor Schwarzenegger, and Mayor Bloomberg in the President's 
office. They presented the President with a report. I can tell 
you, there is a very, very strong commitment from President 
Obama to put everything on the table, to throw out all the 
ideas that we can, and see which ones stick and which ones make 
sense.
    I am committed as a part of his team and a part of his 
Cabinet to work with you. Whenever you need me up here, I will 
be here. When you need our staff, we will be here. We are going 
to be full partners in trying to work through what resources we 
need and how to get those resources.
    And the President is committed to that. I know Governor 
Rendell will talk to you about the work that he has been doing 
with other Governors and Mayors and so forth. But I think we 
came away from meeting with a full commitment from the 
President.
    We have to talk about a lot of creative ideas to do all the 
things we want to do with infrastructure and roads, and to 
create livable communities and other opportunities.
    And so you will have a full partner.
    Senator Boxer. Well, that is really my only question, 
because I think that is what we need right now. None of us is 
ideological about all this. We just want to be pragmatic and 
get this to happen.
    I want to thank Governor Schwarzenegger and Governor 
Rendell, who I will have a chance to formally thank again, and 
Mayor Bloomberg, and yourself, because this is really in a way 
a tripartisan team, Independents and Republicans and Democrats. 
And that is what we need.
    This is something we can get done, but nothing should be 
off the table, even if at first blush, you know, we reject it. 
We just need to be very open to all the ideas.
    So thank you for that comment. I really appreciate it.
    With that, I will turn to Senator Inhofe.
    Senator Inhofe. Thank you, Madam Chairman.
    It might be a good time just for any brief thoughts that 
you have on some of the options that we are looking at. Let's 
start with public-private partnerships. Have you developed any 
ideas that you think might be something we might want to look 
at?
    Mr. LaHood. Well, there are a lot of innovative public-
private partnerships that we can model after. In Miami, they 
are building an intermodal facility that I had the privilege of 
visiting with Vice President Biden to make some announcements 
on a couple of weeks ago.
    There are some folks out west that are putting together a 
public-private partnership having to do with high speed rail. 
There are lots of people in this Country who want to work with 
us at DOT and all of you to put some private dollars with 
public dollars, and really leverage what we can to make these 
things happen.
    It is not only on high speed rail. It is on highways. It is 
on intermodal facilities. And there are lots of examples out 
there that we can use to build on.
    Senator Inhofe. You know, I am glad to hear you say that 
because all too often, we want to reinvent something that has 
already been invented. We have a testing area out there, like 
Governor Rendell and others, have tried things. Some things 
haven't worked. Some have worked. And I would hope that we 
could go and try to pick the very best of those and perhaps use 
them.
    One of the areas, well, let me thank you again for your 
appearance at our Chamber the other day. That was very helpful.
    Mr. LaHood. Sure.
    Senator Inhofe. One of the other areas that we talk about 
up here, you have been there long enough you have probably 
looked. Both Chairman Boxer and I have complained about some of 
the bureaucratic delays that might be eliminated. Have you 
looked at some of these and how we might be able to expedite 
some of the programs that we have?
    Mr. LaHood. When we implemented the recovery plan, our part 
of it, the $40 billion plus at the Department, we put together 
for the highway portion, the $28 billion, what we call--well, 
for all of it, including transit--we put together a TIGER team, 
where we took all the modes and they meet every day. I meet 
with them once a week and we talk about how we are getting the 
money out the door and how the money is being spent, and we 
make sure we are following the rules and regulations and the 
law that was passed by Congress.
    And this kind of approach has enabled us to get about $3 
billion out the door to 33 States and over 800 projects in a 
very short period of time. So we have cut a lot of the 
bureaucracy, a lot of the red tape. No short cuts. We are 
following the law. But we have done it with the TIGER team 
approach and we are hoping to be able to use that kind of 
approach in getting dollars out the door as Congress passes a 
bill.
    We can do it. We know we can do it. We are doing it right 
now just by getting people in a room working together. And so 
it works, and we are going to take that model and use it to 
work with all of you as you, you know, put together the bill 
that will continue our successes.
    Senator Inhofe. Yes, that is great to hear. That is great 
to hear. I appreciate that very much, Mr. Secretary.
    A couple of times we have referred to the 2006 report and 
the 2008 report is out there somewhere. Where is that?
    Mr. LaHood. It is at OMB. And it was sort of suspended in 
the interim between our Administration and the previous 
Administration. OMB is reviewing it.
    I think we will have a report to you very soon.
    Senator Inhofe. OK. I was saying that at all critically, 
because you just got there.
    Mr. LaHood. No, no. I know.
    Senator Inhofe. I would just think that might be very 
helpful to us.
    Now, as we look at what our job is and what we are going to 
be doing, it is kind of scary to think about the magnitude. I 
can remember during the 2005 bill, and I guess I was Chairman 
at that time. And it was a $286.4 billion, I think, bill. And I 
remember going to the President at that time, President Bush, 
and he said, well, this is just too much. We'll veto it. And I 
said I would head up the veto override, and of course he didn't 
do it.
    But that amount in 2005 was really just enough to kind of 
maintain what is out there. We are just not doing it, not 
keeping up. Have you given any thought to any top line figures 
that, as much as we hate to talk about them publicly, any 
thoughts that you might have?
    Mr. LaHood. We have put together some principles in the 
Department for what needs to be done and how to pay for it. And 
we have sent those to the White House. As a part of the 
Cabinet, we feel that we have to get the President and his team 
at the White House on board on these principles, and once they 
have signed off on them, we will be happy to share them with 
you.
    Senator Inhofe. All right. That is good. That is fair 
enough. Thank you very much.
    Senator Boxer. Thank you, Senator.
    Senator Lautenberg.
    Senator Lautenberg. Thanks, Mr. Secretary.
    I listened with interest, and watched the degree of more 
than interest, perhaps even gluttony, in terms of what it is 
that we need to get this job done.
    You say in your remarks that if we look at the year 2004, 
that we approximated $170 billion in annual maximum economic 
investment. However, if we put this in perspective and we look 
at 2006, what we spent was $78 billion. The shortfall is so 
dramatic that it strikes one as that can't be true; it has to 
be an arithmetic thing. Well, we know that is not the case.
    Mr. Secretary, when it comes to the Highway Trust Fund, an 
important element, the current financial situation is simply 
not sustainable. What kind of plans does the Administration 
have to address this crisis in the near term?
    Mr. LaHood. Well, as I said, we have sent some principles 
to the White House for what the needs are for the way forward, 
and we are waiting. But I have been saying all along, Senator, 
that we need to think outside the box. The Highway Trust Fund 
is simply not going to allow us to do all the things that we 
want to do in America, and in developing our opportunities for 
the way forward. So we need to think about public-private 
partnerships. As much as I hear what Senator Baucus says, we 
need to think about an infrastructure bank.
    We need to throw a lot of ideas out there and see which 
ones stick. And you all are going to write the bill. But we are 
not going to be bashful about saying if you do this, this is 
what you get; if you do this, this is what adds to it.
    We need to build on the Highway Trust Fund. There is not 
enough money in the Highway Trust Fund to do what we need to 
do. So we ought to throw a whole bunch of ideas out there and 
you all decide which ones you think are sound politically 
policy-wise, and what kind of results we get from them in terms 
of new resources.
    I was in Miami and I rode on a lane that was built on 
Interstate 95 with tolls. That works, and they are very happy 
about it. They made that decision. They made the decision to 
build an extra lane on I-95 using tolls, and they paid for it 
that way.
    And so that works. We know that works.
    Senator Lautenberg. That was a State endeavor, and in all 
fairness, a State endeavor. But what do we do nationally? I 
hear a review of opportunities, but what specifically? I mean, 
Mr. Secretary, we are going to have to get leadership from the 
Administration on these things. I mean, we can battle it out 
here, but if we come up to OMB and they say, not possible, 
where are we?
    So we are asking you, I am asking you, to come up with 
particular specific suggestions on how we replace and fulfill 
the obligations of the Highway Trust Fund. We see transit 
systems forced to cut service; increased fares to cover budget 
shortfalls. At the same time, Americans are taking public 
transportation in record numbers. The economic recovery bill 
contained $8.4 billion for transit capital costs, but these 
funds, and all Federal funds, cannot be used for operating 
assistance.
    Might we change the law, Mr. Secretary, to allow Federal 
dollars to be used for operating expenditures?
    Mr. LaHood. Well, I said to another committee, Senator, 
that I am very open minded in these hard economic times to 
looking at the possibility of allowing transit systems to use 
part of their money for operating expenses. It is fine to 
provide a lot of new buses and a lot of new equipment, but if 
you don't have the drivers and you can't pay the drivers, it 
doesn't make any difference how many buses you have.
    We are open minded about that. We are going to look at that 
very carefully. And we think when the transit districts don't 
have enough money to pay bus drivers, it seems logical that we 
should be open minded about that and we are.
    Senator Lautenberg. Well, if we are talking about job 
creation, you just pointed out a place that suggests there are 
lots of jobs available. Do we have the applicants? Do we have 
the interest from the public to take these jobs? And if not, 
where? Show me the money. Absolutely critical.
    The situation that we are in is one that is so difficult. 
And Mr. Secretary, I wouldn't want to be in your position right 
now because you are our flag bearer. You are the one that has 
to continue to fight for a share that will sustain us. And I 
think in the process, you have got to close your ears to the 
other appeals that are being made. You have this mission and 
this mission is critical to the well-being and the ability of 
our Country to get back on its feet.
    So we will give you some more stripes if you can do that.
    Mr. LaHood. We are going to provide the leadership. We take 
our cues from the President, and a big part of the economic 
recovery plan was the $40 billion to $50 billion to put people 
to work quickly because the President knows that works.
    And when you see people out building roads this summer and 
you see transit districts buying buses and you see people 
driving these buses, these are people that are in good paying 
jobs that are going to be working this summer. I think the 
President recognizes the value of a very, very strong 
infrastructure program. You will see the leadership, but we 
need a little bit of time here. The President has been a little 
bit preoccupied with a few other things. We are trying to get 
his attention on these things. We will get his attention. He 
knows the importance of it. And we will provide the leadership, 
Senator. I guarantee you of that.
    Senator Boxer. And I want to say, we will as well. So I 
think this is, we are ready to go. We are very close to being 
ready to go.
    Senator Sanders.
    Senator Sanders. Mr. Secretary, first of all thank you very 
much for getting the money out quickly. I know people think 
that is an easy thing to do, but for many years, that was not 
the case. So thank you for doing that.
    And thank you for your strong advocacy for the stimulus 
package which I think is one of the most important pieces of 
legislation, for a dozen different reasons, that this Country 
has passed in a very, very long time.
    I want you to focus for a moment on rural transportation. 
You know, I am aware of the problems in urban America. My State 
is a very rural State. And you know what? Throughout most of 
rural America, you don't have a transportation system. You 
really don't.
    I could tell you that in my State that if you live in, say, 
Hardwick, Vermont up in the northeastern part of the State, and 
you are going to Burlington, our largest city, there really is 
no practical way for you to get there other than your 
automobile.
    So if we are talking about greenhouse gas emissions, if we 
are trying to talk about saving people money, in many parts of 
rural America, you can't go from one town to another town other 
than with your automobile.
    Can you give us, share with us some thoughts about how we 
are going to make some very profound changes in rural 
transportation in America? What do you think?
    Mr. LaHood. Well, I think that the way to do it, Senator, 
is to take some leadership on our own and take the ideas that 
you all have to try and persuade transit districts that are in 
areas that are not serving rural areas to begin to really look 
at those kinds of opportunities. Now, obviously they would need 
some dollars to do that.
    I think the other part of it is really trying to think of 
opportunities for perhaps some other modes of transportation 
other than just buses. The idea of light rail, you have to be 
able to show that that can work and that you would have the 
ridership, but we know that in some parts of the Country, folks 
are planning those kinds of opportunities.
    To me, those are the two things that we can really look at 
as opportunities to work with transit districts to determine 
their level of interest in really providing the kind of service 
into rural areas.
    I met with a group of mayors recently that are big city 
mayors that have tried to reach out into the rural parts of the 
areas----
    Senator Sanders. If I could interrupt you to tell you why 
that is important is often in the urban areas, the larger 
towns, is where the jobs are and you want to get people from 
the rural areas, the workers, to get to the jobs.
    Mr. LaHood. Correct.
    Senator Sanders. You need that transportation.
    Mr. LaHood. Correct. When I was in Philadelphia, Chaka 
Fattah, the Congressman from that area, told me of a plan where 
he got the transit district in Philadelphia to actually take 
buses out to rural and suburban areas to bring people in for 
jobs.
    Senator Sanders. Right.
    Mr. LaHood. That is the kind of innovative thinking we need 
to be doing with transit districts, to provide the kind of 
transportation to people who maybe are starting a first job and 
don't have a car, and have no way to get into the area where 
the job is.
    Senator Sanders. I think that is exactly right.
    Let me ask you this, do you see potential use, when we talk 
about buses, very often we are talking about large, expensive 
buses. Sometimes in rural areas you don't have the people to 
get on those buses. What about vans and small buses?
    Mr. LaHood. The example I described of Congressman Fattah 
actually used a van. It wasn't a bus, it was vans that went out 
to these rural and suburban areas to bring people in to jobs. I 
don't know if it was a program that Governor Rendell started 
when he was Mayor, but the point is there are innovative things 
that we can do with the dollars that we have, and there are 
systems available to do it. We have to get transit districts to 
think outside the box and we have to develop other 
opportunities.
    Senator Sanders. OK.
    Madam Chair, my only point here is that as we discuss the 
transportation infrastructure crisis in America, we cannot 
forget rural America. That has to be part of the equation.
    Senator Boxer. Well said.
    Now, Senator Voinovich, I owe you an apology. You should 
have been next, and I missed that. I am sorry.
    After you are done with your questions, we are going to 
move to the second panel, so go ahead, Senator.
    Senator Voinovich. Mr. Secretary, a little Ohio problem. I 
brought Continental Airlines to Cleveland back when I was Mayor 
and Continental Airlines needs an international connection with 
the STAR Alliance. They have had an application pending in your 
Department since last year. And I would like somebody here that 
is from your staff to write that down and see if we can't get 
that decision taken care of as soon as possible because they 
are on hold right now because they haven't had that decision 
made by the Department, and we need to have that as soon as 
possible. It is a great job creator in our town in Northern 
Ohio, so if you would take care of that.
    Mr. LaHood. Yes, sir.
    Senator Voinovich. Second of all, you know, we had Mary 
Peters here and Mary, we asked her about how she was going to 
pay for a lot of this, and she kept talking about principles 
and public-private partnerships and so on and so forth. When we 
got to the legislation in the last bill, we came up with $286 
billion. We knew we needed $320 billion or $300 billion, 
something like that. They said it was too much, couldn't do it. 
Many of us said that the money we made available wouldn't keep 
up with inflation, that we would fall behind.
    And I was wrong. It is worse than what I predicted, because 
with the cost of steel and the cost of oil, they haven't been 
able to do what we thought they would be able to do with the 
money.
    Now, the National Surface Transportation Infrastructure 
Financing Commission said that we need to enact a modest 10 
cent increase in the Federal gasoline tax, 15 cent increase in 
the Federal diesel tax, and commensurate increases in all 
special fuels taxes.
    And what they pointed out is that these adjustments 
approximate the amounts required to recapture the purchasing 
power lost to inflation since 1993. That is the last time it 
happened, 1993. That translates into approximately $20 billion 
per year more to just keep us up to where we would be if we got 
that money originally.
    And the question I have is how are we going to pay for all 
these things we are talking about? I think we need to level 
with the American people. It is going to take a gas tax 
increase and it is going to take public-private partnerships 
and it is going to take a whole lot of other stuff to get the 
job done. And I think the sooner we face up to it, the better 
off we are all going to be.
    I know we were talking about doing it here in the Senate. I 
think we would have had some votes in the Senate to pass a gas 
tax increase, but your colleagues over in the House that took 
Grover Norquist's pledge that they wouldn't increase taxes, oh, 
no, we're not going to do that.
    Well, let's get serious. We have a really awful 
infrastructure problem in this Country, and you have heard the 
other Senators talk about other countries. It is time we looked 
the American people in the eye and told them we are in bad 
shape. People complain to me all the time about the time that 
they spend on the road, the gas we burn, the pollution that is 
taking place. I think that we have to be forthright.
    And I would like to know, you know, how are you going to 
take care of this? And it can't be principles and other things. 
Let's get serious. Where are you going to get the money?
    Mr. LaHood. We are going to get the money from Congress, 
Senator.
    [Laughter.]
    Mr. LaHood. You all write the bill. I am just telling you 
though, Senator, and you have heard me say this before, this 
Administration in these hard economic times, with so many 
people out of work, can ill afford to tell people we are going 
to raise the gasoline tax.
    Senator Voinovich. Well, then you can't--look, you can't--
--
    Mr. LaHood. That is off the table for now, Senator.
    Senator Voinovich. You can't do it. You know it and 
everybody else knows it and it is about time we leveled with 
people.
    Mr. LaHood. Senator, respectfully, I disagree with you. I 
think we can do it. I think we can take the Highway Trust Fund 
and do a number of other things that will help us raise the 
revenue to satisfy the needs that we want to meet here.
    Senator Voinovich. If you just did what I said, it would 
give us $20 billion that would put us even. It wouldn't deal 
with the gap of 43 percent in terms of maintaining, or the 31 
percent gap to improve the highway system in the Country.
    Mr. LaHood. Well, I think it is pretty difficult. I met 
with the Governor of Michigan yesterday and she told me that 
their unemployment rate is 12 percent, and if the automobile 
industry continues in the decline that it is in, it is going to 
be higher than that.
    How do you say to people you are going to raise their 
gasoline taxes when 12 percent of the people in Michigan are 
out of work? It is very difficult to do that and we are not in 
a mode to do that. We are in a mode to think about a lot of 
other things.
    Senator Voinovich. Then what you tell them is, I am sorry, 
folks, we are not going to be able to do the job that needs to 
be done in our Country, to take care of the logjams and other 
things that you have. We are not going to do it. We are going 
to delay this for a couple of years of whatever it is. But we 
just have to be honest with people. It is time to level with 
them.
    Senator Boxer. Senator Voinovich.
    Senator Voinovich. Yes.
    Senator Boxer. Thank you for that candor.
    I just think that before you said everything was on the 
table. Now you said the gas tax is not on the table. All I want 
to say is, I am averse to raising the gas tax. But I have not 
signed a pledge, and that means I am willing to see what we 
have to do.
    Now, we are going to have this meeting this afternoon. We 
are putting everything on the table. There are some proposals 
not to raise the tax, but to index it to inflation in the 
future. Now, I would urge you to take a look at that because if 
you index it to inflation in the future, you are not raising it 
today and you are doing it in the future. And by the way, if 
there is no inflation, it doesn't go up.
    But I just think we all, including myself, you know, we 
have to be completely flexible here because at the end of the 
day, you know, I think Senator Voinovich has been very forceful 
on the point, this is one of our constituents' biggest 
complaints. I don't care where you live. It is a problem: 
congestion, pollution, congestion, pollution, falling behind, 
goods movement, business losing money, all this and that.
    Now, Senator Udall did come in to ask a question, a couple 
of questions to the Secretary, so I will allow that, but then, 
drum roll, we will hear from Ed Rendell and our head of the 
Conference of Mayors.
    Yes.
    Senator Udall. Thank you, Madam Chair.
    Senator Boxer. The League of Cities. Sorry.
    Senator Udall. Secretary LaHood, the issue I wanted to have 
you focus on a little bit is how we bring back the railroads. 
And you can enlighten, I think, all of us, but I understand 
that it is much more efficient to move goods and people on 
railroads than it is to move them in automobiles and trucks. 
And so if we are trying to be energy efficient, we should be 
moving in that direction.
    My Governor, Governor Richardson, who I believe you served 
with in the House, has been a real leader in terms of commuter 
rail. We have now built about 80 miles of commuter rail from 
Belen, New Mexico up to Santa Fe. And the ridership is going 
up. I mean, when we hit $4 gasoline, they couldn't put enough 
rail cars on the system in order to accommodate people at 
certain times of the year.
    So I really believe that commuter rail is the way to go, 
and bringing back our railroads. And I hope that your 
Transportation Department will be at the front edge of that. So 
I really want, my question is what actions will you pursue to 
provide funding or to encourage commuter rail and to move in 
that energy-efficient area where you have rail being more 
efficient than some of our other modes of transportation?
    Mr. LaHood. Senator, let me say that a couple of things we 
want to do to implement the Amtrak program that was passed by 
Congress. It is a very good bill and we want to be at the 
forefront in working with all of you to implement that. The 
President personally put $8 billion in the recovery plan for 
high speed rail to launch our opportunities in America for the 
first time, and to say to Americans that high speed rail has a 
priority.
    He also has put a marker down for the next 5 years, $1 
billion in each of his budgets for the next 5 years for high 
speed rail. We have identified corridors in the Country where 
this can be implemented rather quickly. We are in all different 
iterations of high speed rail, but there are some places that 
could begin rather quickly. You have a President and his team 
in the White House that comes from the Chicago area where 
people getting on trains every morning is a common practice, 
whether they live 25 miles from the city of Chicago or just a 
few minutes from downtown. They have one of the best mass 
transit systems in terms of delivering people to jobs of 
anyplace in America.
    So the President's vision is that we do get people on to 
light rail, on to buses, on to mass transit, and on to high 
speed rail in order to get them out of their automobiles and 
provide opportunities for people to use this.
    When gasoline prices went up, ridership on transit, light 
rail, and Amtrak went way up. And even as gasoline prices have 
fallen, the ridership has stayed up. People found that it was 
efficient. It was one time and it was comfortable. And we want 
to continue that kind of progress, and we know that Congress is 
committed through the Amtrak bill that you all passed. And I 
can tell you, this President is committed to the idea that 
passenger rail is very, very important and a priority for this 
Administration and for the Department of Transportation.
    Senator Udall. Thank you very much. And it is great to hear 
that you support that Amtrak bill and that the President has 
put in his budget the kinds of funds that I think are going to 
allow us to do that.
    One of the areas that is the most under served in terms of 
transportation is Indian reservations. I have many in my State 
and I know that there is a significant amount of money, I think 
it is to the tune of about $310 million for Indian reservation 
roads. Apparently much of that, because you have interstate 
highways, is used on those that are within the Indian 
reservation, and then the other tribal roads are neglected.
    So I hope that you will work with me to see that we can get 
money out to those other tribal roads. And I think one of the 
ways to do that would be the piece of legislation, SAFETEA-LU, 
established a Deputy Assistant Secretary for Tribal Government 
Affairs. I hope that you will fill that position. I don't 
believe the position has been filled. I think it would help you 
reach out to tribal communities and bring them together and 
figure out the best ways to provide transportation on Indian 
reservations across the Country.
    Thank you very much.
    Mr. LaHood. Well, I take your point, but I would also tell 
you, Senator, that none of our positions have been filled, so 
it is not just that one. We are working on it.
    [Laughter.]
    Senator Udall. If you send them over here, our Chairman has 
been great at moving these positions along that she has 
jurisdiction over.
    Senator Boxer. Once they come through here, we will try to 
do our best.
    Mr. Secretary, thank you.
    Mr. LaHood. Thank you.
    Senator Boxer. You have been more than kind.
    Mr. LaHood. Thank you.
    Senator Boxer. I think it has been very important. So thank 
you so much.
    If we can move very quickly, we are going to open it up 
with Governor Rendell, our long-awaited Governor, and Hon. 
Kathleen Novak, President of the National League of Cities.
    We honor you. We welcome you. And I think the stage has 
been set now for you to give us that final push forward.
    I would ask people to leave very quickly and quietly. Thank 
you, because we have a vote that starts around the noon hour. 
We want to get started.
    Governor, I am going to give you 7 minutes, and I am going 
to give Kathleen Novak 7 minutes, so please begin.

STATEMENT OF EDWARD G. RENDELL, GOVERNOR, STATE OF PENNSYLVANIA

    Governor Rendell. Good morning, everyone. It is a pleasure 
to be here.
    I am going to break my testimony into three parts. No. 1, 
defining the problem. And I think you have all asked that 
question, what exactly is the problem. No. 2, suggestions on 
how we can come up with the funds to deal with the level of 
funding that is needed. And No. 3, how we sell this in a very 
difficult economic time to the American people.
    Let me start out by saying I am here wearing three hats. 
First, as the Governor of the Commonwealth of Pennsylvania. 
Senator Udall, you said your State has 100 structurally 
deficient bridges. We have 6,000, despite the fact that I have 
tripled State funding on bridge repair in my 6 years as 
Governor.
    I am here wearing a second hat, and that is as one of the 
co-chairmen of Building America's Future, an organization that 
is dedicated to revitalizing the American infrastructure, and 
to having a major infrastructure revitalization program over 
the next 5 to 10 years. My co-chairs are Governor 
Schwarzenegger and Mayor Bloomberg.
    And third as the President of the National Governors 
Association. The Governors this year have devoted, as our 
project for the year, infrastructure revitalization.
    Let me start with the first question. When Senator Inhofe 
said he estimated the Federal gap at $400 billion to $500 
billion, he is correct. If you take what the American Society 
of Civil Engineers says, we have a $2.2 trillion gap just to 
put what we have in good condition. They say that that needs to 
be spent over the next 5 years.
    If you take State, local and Federal funding, we are 
destined to spend about $1.1 trillion over the next 5 years. It 
is about a $1 billion or $1.1 billion gap. But the Federal 
Government isn't, and shouldn't be, expected to fill all of 
that. I would say $500 billion is the appropriate Federal share 
of that gap. There should be State and local funding and 
private investment filling in that gap.
    The second report is your own Surface Transportation 
Commission, which said you have a $140 million gap each year in 
just transportation infrastructure. The Society of Civil 
Engineers was all infrastructure. We are spending as a Nation 
$80 billion a year, that is Federal, State and local. We should 
be spending $220 billion a year. So that would be over 5 years 
just for transportation, a $700 billion gap.
    So the definitions of the gap are pretty certain and pretty 
clear, and I think they are right on.
    Now, how do we fund that gap? There are a number of 
suggestions in the financing report of the Surface 
Transportation Committee, and they are all good, but they are 
death by a thousand cuts. There is a little fee here, a little 
fee there. By the time you are finished, you will have raised 
about 17 fees and taxes, including the gas tax, as Senator 
Voinovich recommends.
    That doesn't mean they are bad, but I think it is a very 
difficult way to sustain the dollars that we need. We support 
many of them as an organization. We support, for example, 
radically increasing TIFIA, the Transportation Infrastructure 
Finance and Innovation Act. In the stimulus bill, TIFIA is 
given $200 million of additional authority to guarantee loans, 
to do direct loans to projects to fill the bridge. These are 
projects that have private funding. We think TIFIA should be 
radically increased. We want to lift the $15 billion cap on 
private activity bonds.
    It is all in here, and they are good suggestions, and they 
all can total up to a decent figure. But in my judgment, there 
is only one way that we are going to come to grips with the 
financing problem that we need for infrastructure in this 
Country, and that is for the Federal Government to do exactly 
what every State does, every city does, and every county does, 
and have a capital budget. It's as plain and simple as that.
    That $500 million share, $500 billion share, Senator 
Inhofe, you could do that if you have a capital budget for $45 
billion a year in debt service. Now, I am not saying $45 
billion a year is easy. It isn't. It isn't easy. But it is 
doable. It is achievable. And that would produce the $500 
billion of the billion dollars that needs to be done by State, 
Federal, local and private sources of income. So I think 
whether you would do Federal Garvey bonds, or you call it that, 
or you do an actual capital budget, it is time to do it.
    President Clinton convened a Commission on Capital Budget, 
and Jon Corzine out of Goldman Sachs, and Kathleen Brown, the 
Treasurer of California, were the co-chairs. I testified before 
that Commission as the Mayor of Philadelphia and as the head of 
an organization called Rebuild America. I testified in favor of 
a capital budget. The Commission took testimony and made a 
report with no recommendations.
    The time has come for us to deal honestly with the problem. 
Senator Voinovich is right. A gas tax increase on the Federal 
level would help, but it is not in and of itself the long-term 
answer.
    Third, how do we get public support, particularly in this 
troubled time? I am sorry Senator Baucus couldn't stay, because 
I know he has a whole host of other responsibilities, but he 
couldn't be more wrong about the infrastructure bank. We need 
something created first of all to deal with multi-State 
projects. We have no mechanisms for multi-State projects right 
now. Each State gets its allocation from SAFETEA-LU.
    There are earmarks. I am a supporter of earmarks. As 
Senator Lautenberg knows, he and I have done a few over the 
years. Most earmarks are good. They are right on the money and 
they help transportation needs in this Country. But the public 
hates them, and no matter what you do, no matter how good 
earmarks are, no matter how many controls you put in, earmarks 
will be a dirty word in the American political lexicon going 
forward.
    We at Building America's Future took a poll. We had Frank 
Luntz do the poll. I am sure you are all familiar with Frank. 
And the poll found that 81 percent of Americans would pay 1 
percent more on their Federal income tax, and by the way, the 
poll was taken in December in the middle of the recession, and 
81 percent would pay 1 percent more on their Federal income 
tax, and that was 90 percent Obama voters. Seventy-five percent 
of people who voted for John McCain said they would pay more in 
taxes if they could be assured that the decisions on 
infrastructure spending were transparent, accountable, and made 
not through the political system, but made by some balance that 
took into account cost-benefit analysis, value to the Nation, 
does it meet other long-term goals like climate change, et 
cetera.
    So I think we need an infrastructure bank. All Federal 
funding shouldn't funnel through the infrastructure bank. Each 
State should get their own regular stipend because we don't 
want to leave out the rural States. But for the major projects, 
for the projects that are going to change the way this Nation 
does its infrastructure, the way we transport goods, the way we 
move people, we need a facility to make those decisions.
    Now, just because it is an infrastructure bank, it doesn't 
mean that there can't be any input into it by the Congress. You 
could fashion something that has a certain amount of appointees 
from the Administration, a certain amount of appointees from 
each caucus of the Congress. So I think we need something like 
that for major projects, but most of all we need to be able to 
sell this to the American people.
    And the good news is, last thought, most of these funding 
sources and the capital budget have relatively moderate impact 
on the operating Federal budget.
    Thank you.
    [The prepared statement of Governor Rendell follows:]
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    Senator Boxer. Thank you, Governor.
    The Honorable Kathleen Novak, thank you for being with us.

 STATEMENT OF KATHLEEN M. NOVAK, PRESIDENT, NATIONAL LEAGUE OF 
              CITIES; MAYOR, NORTHGLENN, COLORADO

    Ms. Novak. Thank you, Madam Chair, Ranking Member Inhofe, 
and members of the Committee.
    I am Kathy Novak. I am the Mayor of Northglenn, Colorado 
and President of the National League of Cities. The National 
League of Cities is the Nation's oldest and largest 
organization devoted to promoting cities and towns as centers 
of opportunity and innovation. We represent over 19,000 cities 
and towns from New York City, with eight million people, to 
Taos Ski Valley, New Mexico with 56. So when we come, we speak 
with a collective voice that represents both urban and rural 
interests.
    You have my written statement, so I would like to just 
offer a couple of comments based on what I have heard so far 
today. I am pleased to be here with former Mayors Inhofe, 
Voinovich, Sanders and Rendell. So often, my citizens come to 
me and see government as government. They don't really 
distinguish the Federal, State and local levels. So I am 
getting questioned every single day: What are you doing about 
immigration? What are you doing about transportation? What are 
you doing about homeland security?
    And while local governments are certainly partners, we need 
I think to do a better job of really working together in a 
seamless manner to serve the people that we all serve.
    I was reminded by Senator Baucus's comments about the 
story, and he was talking about the crisis, and how we respond 
very well to crisis. There is a story about boiling frogs, that 
if you throw a frog into a pot of boiling water, he immediately 
reacts and jumps out. However, if you put a frog in cold water 
and slowly turn up the heat, he will boil to death because he 
doesn't realize the crisis that he is getting into.
    That is, I think, how we have treated our transportation 
system. We made great investments in our national highway 
system, but we have been slowly turning up the heat, not 
investing the way we need to, and are now at a crisis point.
    I think this situation really requires a sustainable 
revenue source, as you were talking about, Senator Voinovich, 
one that is really dedicated to meeting our needs. But it is 
more than just throwing money at the process, just money at the 
situation. And we really need a collaborative partnership 
between all levels of government to make this work.
    Hometown America is where investments meet Federal, State 
and local policy goals. For our citizens, transportation is not 
an end in and of itself, but a means to an end. It is about 
getting our kids to school. It is about getting to work. It is 
about providing and accessing the goods and services that we 
need. It is critical to economic development and quality of 
life.
    Transportation isn't just highways and bridges, but it is 
rail, and air, roads, pedestrian bikeways, and transit. And all 
of these must work in a systematic way in sync with our 
environmental goals, our economic development goals, affordable 
housing goals, and livable community goals.
    According to the Brookings Institute, individual household 
investment in transportation has risen. It is now the second 
largest expense for most Americans after housing. As we better 
understand the impact of transportation systems and the impact 
that they have on environmental quality, economic strength, 
housing and public health, all levels of government need to 
think comprehensively about how we ensure that all 
transportation investments yield a greater level of return for 
our residents.
    In my region, we often talk about driving until you 
qualify, that you have to drive further and further away from 
the Denver metro area in order to qualify and get affordable 
housing. Well, people are just trading housing costs for 
transportation costs, and that is in direct conflict with our 
regional goals of increasing density, reducing congestion, 
improving our air quality, and discouraging sprawl.
    We encourage you, and actually we want to work with 
Congress to develop a comprehensive national transportation 
plan that does a number of things: strengthen our cities and 
towns as centers of economic growth; create economic 
opportunity for all our residents; recognize the link between 
energy consumption and transportation; and help us meet our 
goals for livable, vibrant, health and sustainable communities.
    I think this partnership involves breaking down silos not 
just between governments, but within the different levels of 
government. For example, metropolitan planning organizations, 
which play a large role in bringing a variety of communities 
together in a region, are making transportation decisions. But 
often the Federal programs aimed at helping communities are too 
siloed with different rules, different timeframes, different 
sources of funding, and different regulatory frameworks that 
don't allow the local officials to integrate these programs 
efficiently to better serve our communities. And that is just 
within the transportation programs.
    I think Secretary LaHood's creation of the TIGER team to 
really help break down the bureaucracy, work among the 
different departments and agencies of the Country, of the 
Federal Government, will really help local governments.
    The National League of Cities applauds last week's 
announcements by Secretaries LaHood and Donovan to link Federal 
housing and transportation programs, and we look forward to 
working with both of these agencies to develop integrated 
planning and better coordinate these important programs.
    This is, I think, the first step to help break down the 
complexities. It is often overwhelming. I have been in local 
government as a City Council member and a Mayor for 18 years 
now. And I still don't understand how it all works.
    But when I look at a transportation program, for example in 
our area we are trying to develop FasTracks, a metro-wide 
system buildout. And when I look at a project in my area, it 
could potentially involve affordable housing, senior housing, 
day care, CDBG, transit funding, transportation enhancement 
funding, energy efficient street lighting, potentially 
brownfields sites, issues of access to credit, all with trying 
to follow the principles of Complete Streets and NEPA 
requirements.
    There is so much there and so much energy, time and 
resources devoted to dealing with the bureaucracy that I don't 
think we are really leveraging the dollars as well as we could.
    Local government has been partner and has raised taxes in 
order to deal with our transportation systems and fund them. 
And we need to continue to invest in both maintaining our 
current infrastructure, as well as building a real system that 
works for all Americans.
    We look forward to partnering with the Federal Government. 
Just last week, we had over 2,500 local officials here for our 
congressional City Conference. Really, I think it launched a 
renewed intergovernmental partnership, and I am here today to 
pledge NLC's support, to work with you, to collaborate in 
developing a forward-looking infrastructure that encourages 
economic recovery and growth and sets the stage for the future 
success of our Country.
    I appreciate the opportunity to speak with you today. Thank 
you very much.
    [The prepared statement of Ms. Novak follows:]
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    Senator Boxer. Thank you very much.
    Here is what we are going to do. I have a question for 
Governor Rendell. Each of us will have 4 minutes. I need to 
leave to do a presentation in 5 minutes, so I will hand over 
the gavel to Tom Udall, and he will close us down about 12:15, 
whenever we have to vote.
    I want to talk to you, Governor, because I am of a mind 
that pay as you go is really a good thing. And I like the 
stream of funding that goes into the Highway Trust Fund, that 
people say, OK, I am paying this tax and I know where it goes 
and I know what it is for.
    So I hope that as the four of us continue to meet, the Big 
Four on this Committee, we are going to be able to take from 
the potpourri of ideas that you held up, because there are ways 
to generate some significant funding.
    Now, the one thing Senator Inhofe and I agreed on is, and I 
am not speaking for him. I will speak for myself. I think he 
agrees, but I will speak for myself. The idea of vehicle miles 
traveled is very attractive because, after all, I happen to 
drive a car that is a hybrid so I don't fill up very much. I am 
not paying my fair share, frankly, you know, of the taxes here, 
and I am going on the road a lot. But I get 50 miles to the 
gallon and I am not filling up.
    That is a good thing, but at the same time, the Highway 
Trust Fund now goes down. So a way to go is for me, how many 
miles do I travel? The one thing I know we agree on is we don't 
like the intrusiveness of that type of system on, you know, a 
family. So that is a problem for us.
    We are going to look at some other ways to get at that, but 
that is the one area where I think we don't like the Big 
Brother aspect of that situation.
    Now, in commercial vehicles, my staff says they already 
have these mechanisms inside the vehicle and they have to be 
used. So that may give us an opening there.
    The point I am making is, to throw up our hands on getting 
a pay as you go system an go to essentially borrowing, which is 
what you are recommending, gives me a little bit of trouble 
because I like the notion of pay as you go. So let me ask you 
this, you did mention, sir, at the end of your remarks, almost 
in an offhand way, in an offhand way, maybe using the 
infrastructure bank for major projects.
    So I am thinking as I look ahead, in the last bill, 
SAFETEA-LU, we had a new item. It was called projects of major 
significance. So to say we can't do big projects in the highway 
bill frankly doesn't hold up because we have done them and it 
is not really a problem. But if we were to look at how to go 
about this, maybe for certain projects of major significance, 
those projects would be funded through that mechanism.
    Is that something that you think we ought to take a look 
at? Instead of throwing out the whole notion of pay as you go, 
just saying maybe for these big projects that, you know, are 
very visionary and will take years and so on and so forth, a 
new mechanism for that. What is your feeling on that?
    Governor Rendell. Three quick points. One on vehicle miles 
traveled, I think it is inevitable that we go to that. But you 
are not going to be able to do that in this bill. What I would 
do is put some money in for a pilot project to do VMT, so the 
next time you look at this, VMT has a real chance. No. 1.
    No. 2, I am for all of these pay as you go things. Right 
now you limit tolling on Federal interstates for the States to 
go in and toll Federal interstates, to three States. We wanted 
to toll I-80. We couldn't get permission. We were turned down 
by the Federal Highway Administration.
    If we really want pay as you go user fees, let the States 
toll the infrastructure all throughout the Country. That is a 
very important component. It would be very helpful to the 
States.
    And you are absolutely right. You can craft this any way 
you want. You could take the infrastructure bank, give it the 
power to do Federal Garvey bonds or a capital budget, and make 
the capital budget much smaller. For $15 billion, you get $180 
billion of money for major projects.
    But let me make one point, and you should check with your 
Governors, every one of your Governors. We can't do major 
projects anymore off of SAFETEA-LU. We cannot, because 
construction costs, and I think Senator Inhofe or one of the 
Senators said it, construction costs for building roads in 
Pennsylvania have gone up 38 percent in the last 3 years. The 
Federal money that you give us now, it is impossible to do 
basically anything other than fix and repair and maintain, 
which is not bad, by the way. We ought to be doing that, I 
think Senator Klobuchar said that. But there hasn't been a new 
project started in Pennsylvania for 2 years because we simply 
don't get the Federal money we used to get.
    Earmarks. You know, earmarks are watched more closely than 
ever before. Do you think there will ever be a Big Dig earmark 
again? I need to double deck the Schuykill Expressway coming in 
from the northwest suburbs into Philadelphia. That is a $2 
billion project. Will I ever see that type of Federal money to 
do the Schuykill Expressway? Of course not.
    So I think your suggestion is a good one. Just like I said, 
all of the Federal money shouldn't go through the 
infrastructure bank. We can pay for the basic Federal SAFETEA-
LU money, user fees, you know, gas tax. I am for all of those 
things that are included in here. We have to make the tax code 
more attractive so that private investors can get in and we can 
do more projects with private money.
    And then last, you are going to have to do major projects. 
Let's just think for a moment. We all agree that a passenger 
rail system linking the big cities of this Country would be a 
great idea. You go to Europe and Asia, nobody flies 500 miles 
or less. It is all high speed rail.
    How are we going to finance a high speed rail system? 
Building a high speed rail system, that is like when Dwight 
Eisenhower decided he was going to build the interstate road 
system. How are we going to finance a high speed rail system 
today without some form of capital funding? You simply can't do 
it.
    So I think you are absolutely right, Madam Chairman. We 
need an amalgam of different things. And they can go through 
different flows, as well.
    Senator Boxer. Thank you very much.
    Mayor Novak, you have to leave soon to catch a flight. What 
time do you have to leave?
    Ms. Novak. Probably about 5 minutes, unfortunately.
    Senator Boxer. Ouch.
    [Laughter.]
    Senator Inhofe. Let me ask a question.
    Senator Boxer. All right. Here is what we are going to do. 
We are going to have Senator Inhofe take his 4 minutes. I am 
giving the gavel to Senator Udall and we will continue until we 
have a vote.
    And thank you very much.
    Senator Inhofe. OK. Let me start.
    Thank you, Madam Chairman.
    Mayor Novak, I am not going to ask you to answer this 
question because it would be too long, but I am going to ask 
you to answer it for the record, which means you will submit it 
in writing and we will have a chance to look at it. And that 
is, after your experience today in watching the trauma that we 
are going through right now and the challenges that are almost 
insurmountable, how do you suggest that we identify the 
appropriate Federal role in addressing mobility needs of cities 
without spending limited Highway Trust Fund dollars on local 
projects and limited national or regional benefits?
    So that is something for the record.
    Now, Governor Rendell, let me make a couple of comments on 
your comments. First of all, when I became Mayor of Tulsa, we 
didn't have a capital budget. We had to build one. That was 
what we did to overcome the problems we had. So I understand 
where you are coming from.
    Second, on earmarks, I have always said if you define 
earmarks appropriately, then I would go along with all the 
hysteria on earmarks, and that should be an appropriation that 
is not authorized. We on this Committee, we set up criteria on 
a formula basis, about 30 criteria that these projects have to 
meet that criteria. And then they go into the appropriations. I 
think that is an appropriate way to do it, but I just would 
like to get that definition cleared up.
    Now, last, I noticed that when I was talking to the 
Secretary about using the States as our test tubes because so 
many good things are happening. You were smiling and nodding at 
that time. And I notice that you have really done a lot of 
things in Pennsylvania in terms of, you mentioned trying to, 
supporting the proposals to put tolls on Interstate 80. But you 
have also supported some of the privatization on the turnpike.
    Would you take whatever time we have here and elaborate a 
little bit on that?
    Governor Rendell. Well, again, I think we have to look at 
every possible funding source.
    Senator Inhofe. I agree.
    Governor Rendell. And there is private capital. Even now, 
there are funds, billions of dollars of funds being formed 
right now, even with all the problems of getting money out into 
the market. And we have to have access to that private capital.
    Now, there are two ways to do it. No. 1 is to let them come 
in, lease major toll roads or new concepts like the additional 
lane on I-95 in Miami, and toll that. There has to be revenue 
streams from there, for transportation to get private capital 
interested, and let them actually run it, but with appropriate 
government controls.
    We were going to control when tolls could go up, if the 
turnpike had been leased successfully, and maintenance 
schedules, the two most important things. With appropriate 
government oversight, leasing can work. It has worked in 
Chicago. You should certainly hear from Governor Mitch Daniels. 
He has made it work in Indiana. Everyone said that people hate 
it in Indiana and there was a fiasco. Well, it has turned out 
to be a great success, and Governor Daniels got 58 percent of 
the vote last year in reelection, even though President Obama 
carried his State. So apparently people didn't hate it as much 
as everyone thought they did.
    So there are instances where it has worked very 
effectively. It has to be part of what we do. But that is one 
level of private investment. Level two is just make it easier 
for institutional and individual investors to invest in 
infrastructure. Tax credit bonds, tax credit Federal bonds for 
infrastructure is an easy way to get individuals who are 
looking for a relatively safe return on their money to 
contribute to helping build our infrastructure. There are 
Flower bonds, Patriot bonds, all sorts of things that we can 
do, and we can improve them using the tax code, to get the 
American people to pay for infrastructure repair and 
revitalization themselves.
    So there are many great ideas out there. I don't think it 
is insurmountable. Particularly, I want to say how great it was 
hearing you and Senator Voinovich talk about your commitment to 
this, because this can only be done in a bipartisan way. If 
this becomes a political issue, we are sunk. So your leadership 
and Senator Voinovich's leadership is absolutely essential.
    I think we can do it. I understand that you all don't like 
capital budgeting. I know the OMB has always hated capital 
budgeting. I don't know why, but they do. Well, let's do a 
limited capital budget for something like the infrastructure 
bank, and let's do the same SAFETEA-LU formula so that every 
State gets something, so the rural States are not left out. And 
let's continue earmarks, but have controls over earmarks.
    I agree with you. The problem is perception governs reality 
so much in our Country, with our 24/7 media. And I don't think 
earmarks will ever regain the type of public support that they 
need. And that is why I am saying we have to find a different 
way to fund major projects. There is never going to be another 
earmark for the Big Dig. It is never going to happen. And every 
State, could New Jersey use Big Dig-type money, Senator? Of 
course you could. I have five projects in Pennsylvania I could 
use Big Dig-type Federal money and use it well, but that is not 
happening. I think we have to realize that.
    Senator Inhofe. Yes, thank you. Let me just thank you very 
much. I know how valuable your time is. You have given us some 
great ideas. Thank you.
    Senator Udall [presiding]. Thank you.
    Senator Lautenberg, we are trying to get three more 
Senators in here in a limited time.
    Senator Lautenberg. I will be real short because Governor 
Rendell and I are neighbors, practically speaking. I just 
wanted to say, and I will be informal, Ed, the one thing I 
respect is your leadership. You are willing to step up to the 
tough problems. That is what made you so popular in 
Pennsylvania. And everything you did wasn't popular, but the 
total sum of things made you a reliable, strong defender of the 
public interest, and my hat is off to you.
    And just one thing that I had my staff produce for me, 25 
percent of domestic flights are 250 miles or less; 2.3 million 
flights a year are less than 250 miles; 6,300 flights every day 
are 250 miles or less. What would a reasonably speedy train do 
for that?
    Governor Rendell. Oh, it would be unbelievable. 
Philadelphia Airport, Newark Airport, and BWI have some of the 
worst waiting times and congestion anywhere. It is because of 
the New York to Washington shuttle. If Amtrak had the proper 
track bed, Amtrak now takes 2:40 or 2:37 to go from New York to 
Washington. Amtrak could go, the Acela could go, with the 
proper track bed, New York to Washington in 1 hour and 30 
minutes. If the Acela could go in 1 hour and 30 minutes----
    Senator Lautenberg. It could go in 2 hours.
    Governor Rendell. Would anybody fly? Would anybody fly? You 
would end the shuttle. And by ending the shuttle, you would end 
congestion in major eastern airports. We should have high speed 
rail. And this is the time to do it, because people know the 
problems, know what we are confronting, and I think people 
support things that they can see.
    I forget who said it, but one of the Senators said, I think 
we were talking about Sputnik, you can see it. Well, you can 
see the building out of a high speed rail system around this 
Country.
    And by the way, not just for urban areas. Someone from 
Wyoming might go to Chicago and then take that train from 
Chicago to Pittsburgh.
    Senator Udall. Thank you.
    Senator Voinovich.
    Senator Voinovich. The National Governors Association, when 
I was involved we had the big seven. And what we would do, and 
I have talked to Ray Scheppach about this, that if the 
Governors got together with the National League of Cities and 
the Conference of Mayors and the legislators group, and came 
down here kind of united on what it was that you wanted, you 
could have a major, major impact on what we are doing. And I 
would suggest that you go back and talk to your colleagues. You 
have great ideas. You are also building America's future. If 
you could say that the Governors are building America's future, 
and the other local governments on a bipartisan basis are 
coming here and saying these are the things that we need to do, 
and are forthright about the fact that, you know, we know we 
are going to have to pay for them. We may have a gas tax. We 
may have the bank. The idea is, please do that, will you? We 
really need your help.
    The other thing is that you ought to be in touch with the 
national Chamber of Commerce and other groups out there. They 
are your allies. If you would come down here and be united, I 
think we would get this thing done and it would really be 
something great for our Country.
    Thank you for your work already.
    Governor Rendell. Well, interestingly, Senator, I have 
spoken, Mr. Engler and I have spoken to people in the Chamber 
and NAM as well. Both of them are very high on infrastructure, 
and know we have to invest. And I have spoken to each one of 
the Big Seven, and we have had joint meetings on this. And we 
are signing up members of the Big Seven as members of Building 
America's Future.
    I have said that we need sometime before SAFETEA-LU gets 
reauthorized, we need to have hundreds and hundreds, maybe 
thousands of Mayors and County Commissioners and Governors and 
people like that here in Washington, with the Chamber, 
supporting and telling the American people the truth.
    You know, it is funny, I tell the American people all the 
time, I said, you know, you spend $10,000 or a car and you get 
a car that is serviceable. You spend $28,000 for a car, and you 
expect to get a better car. Right? You get what you pay for.
    Well, the same thing is true in government. What you have 
the right to do is demand that government spend your dollars 
wisely, but they have to spend them for certain things that are 
crucial to our future, and infrastructure is that. I think the 
American people understand that.
    I would like to submit to the Chairwoman, and I hope she 
will give every member of the Committee the Luntz poll. It is 
very, very revealing. It is very, very revealing. The American 
people do like and understand infrastructure. Interestingly, 
the No. 1 thing that concerns them even more than highways and 
roads was energy infrastructure. People are very concerned 
about energy right now, as well. And energy infrastructure is 
building out the grid. I mean, give President Obama a lot of 
credit for having the foresight. We should have been building 
out our electrical grid 10 years ago, 10 years ago. We are late 
to the game. We are late to the game. But we need to do that, 
and we need to get on the stick. And there is no way out but to 
pay for it.
    Do I think we need an increase in the gas tax? Sure we do. 
It can't be the only thing we do, but we need an increase in 
the gas tax and we have to talk directly to the American 
people. And you are right, if you think the Grover Norquist 
people are damaging here, you should come to State capitals. It 
is brutal in State capitals. I once said that if I had a cure 
for cancer and I said if you guys give me an appropriation of 
$100 million, we can end cancer tomorrow, I would have one-
fourth of my legislature voting against it.
    Senator Voinovich. Well, someday you and I will talk about 
that.
    [Laughter.]
    Governor Rendell. Absolutely.
    But don't stop. I think the American people will support 
common sense infrastructure investment.
    You know, I was on a TV show last night and they were 
mocking President Obama for saying----
    Senator Voinovich. Sorry. I have to go vote.
    Governor Rendell. They were mocking President Obama for 
saying investment instead of spending. But that is what it is. 
We are investing in our infrastructure. We are investing in our 
Country's future.
    Senator Udall. Governor, you have enlightened us today. You 
have been a great leader on these transportation issues. And I 
think because of your testimony, we are going to be able to do 
a lot better job when we craft this bill.
    So we very much thank you for your testimony here today. We 
are all going to now run for a vote, but thank you for your 
service.
    I ask unanimous consent to submit testimony for the record 
from the American Society of Civil Engineers, the authors of 
the 2009 Report Card for America's Infrastructure.
    [The referenced document follows:]
    
    [GRAPHIC] [TIFF OMITTED] 
    
    
    Senator Udall. The Committee is now adjourned.
    [Whereupon, at 12:12 p.m. the Committee was adjourned.]


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