July 28, 2015

A Solution on Highways


  • The Highway Trust Fund has had 33 short-term extensions since 2009; current authorization for funding expires on July 31.

  • The bipartisan DRIVE Act is the first long-term highway bill since 2005.

  • The DRIVE Act authorizes federal surface transportation programs for six years. It requires $47 billion in offsets to keep the Highway Trust Fund solvent for three years. 


On July 31, authorization for funding the Highway Trust Fund expires. Since 2009, Congress has passed 33 short-term extensions. In the DRIVE Act, the Senate committees of jurisdiction have come together to produce legislation providing long-term certainty to our infrastructure and transportation programs. The legislation increases investment in transportation by three percent over the next six years.

“The DRIVE Act is a solution, it’s the solution – a bipartisan solution. It provides the needed long-term funding certainty so that the major construction projects can get off the ground – projects that aren’t possible with short-term extensions. And it will signal to job creators that America’s economy is not only going to grow, but it’s going to be sustained because the infrastructure will exist to support it.”  – Senator Jim Inhofe, 7/25/2015

Credible Pay-fors and Offsets

Extensions

  • Extends authority to spend from the Surface Transportation trust fund, the Sportfish Restoration and Boating trust fund, and the Leaking Underground Storage Tank trust fund through October 1, 2021. Extends related tax authorities through October 1, 2023.
  • Transfers savings obtained from the bill’s offsets into the Surface Transportation general fund.
  • Transfers to the Highway Trust Fund proceeds from certain motor vehicle safety penalties.

Tax Compliance

  • Requires estates with positive income tax liability to report the value of a piece of property upon the owner’s death, so that beneficiaries do not overstate the value of that property. This provision raises $1.542 billion over 10 years.
  • Allows the revocation of a passport or denial of a passport application if a person has more than $50,000 in unpaid federal taxes. This provision would raise $398 million over 10 years, and it is also included in the customs bill currently in conference.
  • Clarifies that the six-year statute of limitations for some tax laws applies in cases in which taxpayers overstate the cost (basis) of property and thereby indirectly understate their income. Cases in which taxpayers directly understate their income are already subject to a six-year statute of limitations. This provision raises $1.206 billion over 10 years.
  • Requires more mortgage information reporting to the IRS to reduce inaccuracies. This provision raises $1.806 billion over 10 years.
  • Changes the filing deadlines for partnerships, S corporations, and C corporations in order to improve compliance. This change raises $285 million over 10 years.
  • Requires the IRS to use private debt collectors to collect unpaid taxes. This provision would raise $2.481 billion over 10 years.
  • Extends through 2025 the ability of pension plan sponsors to use surplus assets to fund retiree health accounts and retiree life insurance, previously set to expire on December 31, 2021. This provision would raise $172 million.

Fees and Receipts

  • Extends the deposit of TSA fees into the general fund by two years. This would raise $3.5 billion.
  • Indexes the dollar amounts for various customs fees and thresholds in 19 USC 58c to inflation (CPI-U). This provision would raise $5.697 billion over 10 years.
  • Amends the Federal Reserve Act to lower the annual dividend paid to Federal Reserve banks from six percent of paid-in capital stock to one and a half percent for banks with consolidated assets of $1 billion or more. This change would raise $17.106 billion.
  • Provides for drawdown and sale of 101 million barrels of crude oil from the Strategic Petroleum Reserve from fiscal year 2018 through 2025, raising $9.050 billion.
  • In December 2011, Congress raised the guarantee fees charged by Fannie Mae and Freddie Mac by 10 basis points through October 2021 and sent the proceeds to the Treasury. The bill extends the provision through October 2025. This would raise $1.9 billion.

Outlays

  • Strikes the requirement that the Interior Department’s Office of Natural Resources Revenue pay interest on an oil and gas lessee’s overpayment of royalties. This provision reduces outlays by $320 million.

Time for a long-term transportation bill

The Safe, Accountable, Flexible, Efficient Transportation Equity Act – A Legacy for Users (SAFETEA-LU), enacted in 2005, was the last long-term transportation authorization. Since the expiration of that law in 2009, Congress has passed only short-term extensions.

The president, his transportation secretary, and Senate Democrats have all advocated for a long-term transportation bill. The administration proposed a six-year, $478 billion transportation bill, though it offered no responsible method for funding that bill. Republicans have identified an accountable plan for paying for infrastructure. Now it is time for Washington Democrats to put politics aside and accept the long-term solution they have been asking for.

Issue Tag: Economy