[Congressional Record Volume 142, Number 107 (Friday, July 19, 1996)]
[Senate]
[Pages S8370-S8372]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     TRANSPORTATION EMPOWERMENT ACT

  Mr. MACK. Mr. President, yesterday I introduced legislation entitled 
the Transportation Empowerment Act which will return primary 
transportation program responsibility and taxing authority to the 
States. I intend to be brief today. But, I will be back on the floor to 
speak to this proposal periodically over the remainder of the Congress 
and again early in the next Congress as debate begins in earnest on the 
reauthorization of the transportation bill known as the Intermodal 
Surface Transportation Efficiency Act [ISTEA].
  The era of Big Government is over. The highway system is a relic of 
this era and a perfect example of a program that ought to be returned 
to the States.
  In the 1950's, the Federal Government began building the Interstate 
Highway System. Its construction was slated to last 13 years and cost 
$25 billion. It has lasted 40 years at a cost of about $130 billion. At 
the same time, the Federal-Aid Highways Program was also expanded to 
include more than $170 billion in other programs and projects.
  The antiquated system of collecting and distributing gas tax dollars 
to fund these programs as well as the transportation priorities of the 
States and local governments is inefficient, costly, and bureaucratic.
  The Interstate Highway System is complete. Now it's time to change 
directions to provide State and local governments the authority and the 
flexibility to move forward without succumbing to the bureaucratic 
whims of Washington.
  This legislation does just that--it re-empowers States to make their 
own decisions. This bill uses a 2-year transition period to lower the 
Federal gas tax, eliminate most highway trust fund programs, relieve 
States of an array of regulations and restrictions, and remove Federal 
roadblocks to infrastructure privatization.
  This proposal provides that the Federal Government would retain a 
core Federal transportation program including maintenance of the 
current Interstate System. Federal participation would also continue 
for Indian reservation roads, public lands, parkways and park roads, 
and emergency relief.
  The bottom line is this--for far too long Washington has had a 
stranglehold on States' transportation needs. It's past time for 
Washington to let go and let the States take responsibility for their 
own surface transportation needs.
  Mr. President, I have included several letters on this issue which I 
have previously sent to my Senate colleagues and I ask unanimous 
consent

[[Page S8371]]

that they be printed in the Record. I also ask unanimous consent that a 
summary of this legislation be printed in the Record.
  I ask my colleagues to review this proposal and to consider joining 
me as a cosponsor of this legislation which will re-empower States and 
end Washington's micromanagement of States' transportation dollars and 
priorities.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:


                                                  U.S. Senate,

                                     Washington DC, March 7, 1996.
       Dear Colleague: Several weeks ago, I sent you a letter 
     informing you of my plan to introduce legislation which 
     largely repeals the federal gas tax and returns the primary 
     transportation program responsibility and taxing authority to 
     the states. I am currently drafting this legislation as well 
     as exploring options to ensure a smooth transition from a 
     federal to a state program.
       In light of this effort, I thought you might be interested 
     in the attached article which highlights a major problem with 
     the current federal transportation system.
       This article, from the February 23, 1996 edition of the 
     ``American Association of State Highway and Transportation 
     Officials (AASHTO) Weekly Transportation Report,'' contains 
     excerpts of a speech by Deputy Highway Administrator, Jane 
     Garvey. Ms. Garvey predicted future transportation funding 
     will fall dramatically short of previous years' levels and 
     she further indicated future transportation funding will be 
     spent on non-transportation priorities.
       Our states have consistently asked that their highway trust 
     fund dollars be reserved for infrastructure requirements and 
     that they be returned unencumbered by federal restrictions 
     and mandates. It is my belief this request can only be 
     accomplished by removing these transportation dollars from 
     the federal coffers. The simple fact is that, if left in 
     federal hands, these funds will always be a temptation for a 
     Congress which must contend with competing priorities and 
     declining discretionary funding levels.
       I hope you will consider the benefits of returning 
     transportation program responsibility and primary taxing 
     authority to the states and join me in this effort. Should 
     your staff have any questions or comments, please have them 
     contact Patrick Kearney of my staff at 224-3102.
           Sincerely,
                                                      Connie Mack,
     U.S. Senator.
                                                                    ____



                                           The AASHTO Journal,

                                Washington, DC, February 23, 1996.

           Less Funding, More Alternative Financing Predicted

       Predicting lean years ahead for federal transportation 
     funding, Jane Garvey, Deputy Administrator, of the Federal 
     Highway Administration, this week outlined alternatives for 
     funding future transportation projects, and some of the 
     issues the Administration will address in reauthorization of 
     federal transportation programs.
       Garvey discussed the status of the Administration's FY 1997 
     budget proposal and provided a future outlook for 
     transportation funding during a Women in Transportation 
     Seminar luncheon on Wednesday. She said that the budget 
     submitted by the Administration on February 6 provided a 
     broad framework of the cuts the Administration hopes to 
     achieve next fiscal year. She added that specific figures as 
     to how transportation funding would be affected have not been 
     made available.
       Garvey stated that the President would submit a detailed 
     budget proposal on March 18, and that representatives from 
     the FHWA would be appearing before the House Transportation 
     Appropriations Subcommittee on March 20 to discuss their 
     budget proposal (see related article).
       Contending that transportation made out well during FY 
     1996, Garvey predicted that future funding levels will fall 
     dramatically short of previous years' levels. All 
     discretionary funding categories are expected to take a hit 
     in FY 1997, Garvey stated, and infrastructure spending will 
     have to compete with other priorities. She added that an 18 
     percent reduction in transportation spending between FY 1997 
     and FY 2002 is expected, from $38.9 billion in FY 1996 to $32 
     billion in 2002.
       To address this situation, Garvey stated that it was 
     essential for federal, state and local transportation 
     organizations to convey how important the nation's 
     transportation system is to the welfare of the economy and 
     its citizens. In addition, states and localities must be able 
     to maximize what funding is made available to them to the 
     greatest extend possible, according to Garvey.
                                                                    ____



                                                  U.S. Senate,

                                Washington, DC, February 14, 1996.
       Dear Colleague: Soon after the Senate returns from the 
     President's Day recess, I will introduce legislation to 
     substantially reduce the federal role in transportation and 
     return the primary program responsibility and taxing 
     authority to the states. At a time when Governors and 
     Congressional leaders are talking about providing greater 
     freedom for states, it just does not make sense to continue 
     the current system.
       States do no want to receive transportation funding with 
     federal strings attached. They do not want restrictions on 
     how transportation funding can be spent and have funding 
     withheld for noncompliance with mandates. Moreover, Governors 
     are rightly concerned over the prospect of seeing more of 
     their transportation funding diverted to other spending 
     programs. Congress' record in this regard is abysmal and is 
     unlikely to improve as other priorities compete for budget 
     dollars in the future.
       The legislation I plan to introduce will leave in place 
     those portions of the gas tax set aside for deficit reduction 
     as well as a few additional cents to sponsor a modest federal 
     program. This federal program will be comprised of the 
     Interstate Maintenance, Interstate Bridges, Federal Lands and 
     Emergency Disaster programs.
       The remainder of the tax will be repealed after DOT has met 
     all of its current obligations. DOT has estimated these 
     obligations will be met approximately 15 months after the 
     expiration of the existing authorization. This time delay 
     provides states ample time to take whatever actions may be 
     necessary to implement their own funding measures.
       We need to return primary program responsibility and taxing 
     authority for transportation programs to the states. I look 
     forward to having you join me in this effort. If your staff 
     has any questions or comments, please have them contact 
     Patrick Kearney of my staff at 224-3102.
           Sincerely,
                                                      Connie Mack,
     U.S. Senator.
                                                                    ____



                                                  U.S. Senate,

                                   Washington, DC, April 25, 1996.

                 Off Budget--a Symptom or the Solution?

       Dear Colleague: Last week the House of Representatives 
     voted by a wide margin to remove the transportation trust 
     funds from the Unified Budget. This vote reflected the 
     frustration of the House members, and their respective 
     states, with the manner in which the federal government 
     manages transportation spending. However, in my view the 
     legislation approved by the House is not a solution to the 
     core problem--a federally run transportation program.
       Before developing a solution the problem must be defined. 
     And, the problem is much greater than that suggested by the 
     House legislation. It is, in fact, a three part problem 
     consisting of:
       Withholding our state's gas tax dollars; Redistributing 
     states' gas tax dollars; and Federal micro-management.
       Regrettably, the House-passed legislation only addresses 
     the first of these parts and ignores the other two. It fails 
     to address the redistribution of states' contributions to the 
     trust fund which strikes me as peculiar now that the 
     Interstate system is complete. Additionally, the House 
     legislation doesn't address federal micro-management of this 
     funding which has plagued our states' transportation 
     officials for years. The legacy of a program run through the 
     federal government is one which has provided: funding 
     restrictions on various program areas, mandatory spending 
     requirements with penalties for non-compliance, and redundant 
     administrative requirements.
       For these reasons, I ask you to consider a real solution 
     rather than simply alleviating one symptom. Please join me 
     and consider exploring a truly off-budget proposal, one that 
     phases out most of the federal transportation program and 
     returns transportation program responsibility and primary 
     taxing authority to the states.
           Sincerely,
     Connie Mack.
                                                                    ____



                                                  U.S. Senate,

                                     Washington, DC, July 9, 1996.
     ``Turning Back'' the Highway Trust Fund
       Dear Colleague: Over the last several months I have written 
     to you on a number of occasions regarding proposed 
     legislation to return primary transportation program 
     responsibility and taxing authority to the states. Attached 
     is a summary of this legislation which I plan to introduce 
     next week.
       With the completion of the Interstate System, it is time 
     for us to examine the lessons of the past and explore our 
     options for the future. Although it was initially envisioned 
     as a ten year, $30 billion highway program, the Federal Aid 
     Highway program exploded into one that has lasted 40 years 
     and has cost nearly $300 billion. Additionally, the existing 
     program is plagued by an enormous bureaucracy that inhibits 
     states' flexibility and withholds states' scarce 
     transportation dollars.
       Rather than continue the tired and troubled practices of 
     the past, shouldn't we as a Nation look for a better way to 
     address our infrastructure needs? I believe the legislation I 
     am proposing will allow states to better serve the driving 
     public as we head into the 21st Century.
       It is my intention to introduce this legislation early in 
     the week of July 15, 1996. Congressman John Kasich (R-OH) 
     will be introducing companion legislation in the House of 
     Representatives. If you wish to be an original cosponsor of 
     this legislation please contact my office by Friday, July 12, 
     1996. Should your staff have any questions or require 
     additional information please do not hesitate to have them 
     call Patrick Kearney of my staff (x4-3102).
           Sincerely,
                                                      Connie Mack,
     U.S. Senator.
                                                                    ____


[[Page S8372]]

  Transportation Empowerment Act--Senator Connie Mack. Representative 
                              John Kasich


                                Summary

       The Federal government collects about $24 billion in 
     dedicated transportation taxes, skims money off the top for 
     demonstration projects, skims more of the top to fund the 
     Washington highway bureaucracy, runs the remainder through a 
     maze of formulas, and then returns gas taxes of the states. 
     Understandably, states complain that this approach is 
     needlessly complicated and denies them the funding 
     flexibility and stability they deserve.
       The Mack/Kasish bill re-empowers states in transportation 
     financing and decision making. Our bill uses a two-year 
     transition period to lower the Federal gas tax, eliminate 
     most highway trust fund programs, relieve states of myriad 
     federal restrictions and regulations, and remove federal 
     roadblocks to infrastructure privatization. Each state would 
     be free to replace the Federal gas tax and keep those dollars 
     within the state.
       The Mack/Kasich legislation retains federal oversight of 
     the maintenance of the current interstate system. Federal 
     programs also remain in place for Indian reservation roads, 
     public lands, parkways and park roads, and emergency relief. 
     The Mack/Kasich bill also creates an Infrastructure Special 
     Assistance Fund for critical programs the Congress may elect 
     to fund, including providing transitional assistance.


                             implementation

       This legislation provides a two year transition. During the 
     transition period of fiscal years 1998 and 1999, this 
     legislation keeps in place the current 14 cents gas tax 
     dedicated to transportation purposes.
       7 cents in 1998 and 2 cents in 1999 are dedicated to the 
     remaining downsized federal program, to pay off existing 
     obligations, and to fund the Infrastructure Special 
     Assistance Fund.
       The remainder of the gas tax (7 cents in 1998 and 12 cents 
     in 1999) is returned to the states in a block grant based on 
     their contributions to the trust fund. The block grant could 
     be used for transportation purposes without restriction from 
     Washington.
       At the beginning of fiscal year 2000, the federal gas tax 
     is reduced to 2 cents.
       This two-year transition gives states time to prepare to 
     regain control over their highway program and raise their 
     state gas taxes if they choose. Any money collected would 
     stay within the state to be used as the state sees fit 
     without restriction from Washington.


                            other provisions

       The Mack/Kasich legislation acknowledges that states will 
     need to cooperate on many transportation issues. The bill 
     authorizes states to establish multi-state ``compacts'' for 
     planning, financing and establishing safety and construction 
     standards.
       The legislation will encourage innovative approaches on the 
     part of the states, such as use of infrastructure banks and 
     privatization. The bill repeals the requirement that states 
     repay federal grants associated with transportation 
     infrastructure which is slated for privatization.
       This legislation only addresses gas taxes currently 
     dedicated to transportation purposes. it does not address the 
     4.3 cents currently dedicated to deficit reduction.
       Currently, other transportation funding ``reform'' 
     proposals are being discussed on the Hill. Generally, these 
     proposals seek to reform the highway program by increasing 
     flexibility and revising current formula which returns gas 
     tax dollars to the states. However, because gas taxes would 
     continue to be funneled through Washington, these formulas 
     invite the re-emergence of Washington micro management and 
     changes to the formulas in future authorizing legislation.
       The Mack/Kasich bill permanently returns control over 
     America's infrastructure to the states by phasing out much of 
     the Federal program and reducing the gas tax. This greatly 
     reduces the risk of Washington micro management in the 
     future.

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