WASHINGTON, Feb 17 (Reuters) - The fund backing U.S. highway and transit programs will be broke by August if Congress does not pass a bill that would extend those programs and transfer $20 billion into the fund, the chair of the Senate's public works committee told reporters on Wednesday.
'It is very critical,' said California Democrat Barbara Boxer. 'If we don't have that transfer ... then starting in June and certainly by August, the Highway Trust Fund will be out of funds.'
An 18.4-cent tax levied on every gallon of gasoline sold in the United States is deposited into the fund, which distributes money to states for highway and road projects. But the tax has not kept up with spending needs and the fund is perpetually at risk of going broke.
Recently problems caused by precarious finances have been compounded by the expiration of the law governing the country's transportation programs. Congress has repeatedly passed short extensions of the law, with the latest stretching through the end of this month, and the Senate is considering a bill that would put in place a longer extension to the end of the year.
That is crucial for states, said Boxer.
'The extension provides them with the certainty they need to make decisions as they carry out their plans,' she said.
The executive director of the American Association of State Highway and Transportation Officials, John Horsley, told reporters on a conference call that states cannot issue long-term contracts for road work under monthly extensions.
Members of the House of Representatives have drafted a new bill to rearrange the country's transportation programs that costs more than $400 billion. But they recently passed a jobs bill that included a long-term extension of the law. The expired law carried a price tag of $286 billion.
Senators such as Boxer say the Highway Trust Fund cannot support such a large jump and have stopped the legislation until more revenue can be found. President Barack Obama's administration, too, has worked to slow down the bill until the U.S. economy is on better footing.
The extension and money transfer would be attached to a jobs bill the Senate is debating.
Meantime, billions of dollars continue to be sent to states and local governments for roads, bridges and even bicycle paths through the stimulus plan passed last year. On Wednesday, the transportation department awarded $1.5 billion in stimulus grants to 51 transportation projects across the nation.
(Reporting by Lisa Lambert; Additional reporting by John Crawley; Editing by James Dalgleish and Dan Grebler) Keywords: USA INFRASTRUCTURE/HIGHWAYTRUSTFUND (lisa.lambert@thomsonreuters.com; Tel: +1-202-898-8328; Reuters Messaging: lisa.lambert.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
'It is very critical,' said California Democrat Barbara Boxer. 'If we don't have that transfer ... then starting in June and certainly by August, the Highway Trust Fund will be out of funds.'
An 18.4-cent tax levied on every gallon of gasoline sold in the United States is deposited into the fund, which distributes money to states for highway and road projects. But the tax has not kept up with spending needs and the fund is perpetually at risk of going broke.
Recently problems caused by precarious finances have been compounded by the expiration of the law governing the country's transportation programs. Congress has repeatedly passed short extensions of the law, with the latest stretching through the end of this month, and the Senate is considering a bill that would put in place a longer extension to the end of the year.
That is crucial for states, said Boxer.
'The extension provides them with the certainty they need to make decisions as they carry out their plans,' she said.
The executive director of the American Association of State Highway and Transportation Officials, John Horsley, told reporters on a conference call that states cannot issue long-term contracts for road work under monthly extensions.
Members of the House of Representatives have drafted a new bill to rearrange the country's transportation programs that costs more than $400 billion. But they recently passed a jobs bill that included a long-term extension of the law. The expired law carried a price tag of $286 billion.
Senators such as Boxer say the Highway Trust Fund cannot support such a large jump and have stopped the legislation until more revenue can be found. President Barack Obama's administration, too, has worked to slow down the bill until the U.S. economy is on better footing.
The extension and money transfer would be attached to a jobs bill the Senate is debating.
Meantime, billions of dollars continue to be sent to states and local governments for roads, bridges and even bicycle paths through the stimulus plan passed last year. On Wednesday, the transportation department awarded $1.5 billion in stimulus grants to 51 transportation projects across the nation.
(Reporting by Lisa Lambert; Additional reporting by John Crawley; Editing by James Dalgleish and Dan Grebler) Keywords: USA INFRASTRUCTURE/HIGHWAYTRUSTFUND (lisa.lambert@thomsonreuters.com; Tel: +1-202-898-8328; Reuters Messaging: lisa.lambert.reuters.com@reuters.net) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.