Highway bill becomes House Republican headache

[March 23, 2012]  WASHINGTON (AP) -- A bill that Republican leaders were promoting as the centerpiece of their job-creation agenda has instead turned into one of their biggest headaches, thanks largely to tea party conservatives who want to get the federal government out of transportation programs and hand them over to the states.

The House and Senate are heading toward a showdown next week that could result in a cutoff of federal highway and transit aid to states just as the spring construction season starts. The government's authority to spend money from the trust fund that pays for transportation programs, as well as its power to levy the federal gasoline and diesel taxes that feed the fund expire on March 31. Democrats estimate as many as 1.8 million jobs supported by those programs are at risk.

Neither side wants a shutdown, but House Speaker John Boehner has been unable to recruit enough Republicans to pass the GOP's overhaul of federal highway programs. The biggest group of holdouts are conservatives who want highway programs to be paid for entirely by federal gas and diesel taxes even though that might mean a nearly 40 percent cut in spending, because revenue from those taxes has declined.

Boehner's fallback plan is to pass a 90-day extension of current programs in order to give the House more time to line up votes for a comprehensive bill. But Senate Majority leader Harry Reid, D-Nev., said Thursday he's "not inclined" to go along with an extension. He urged the House to instead take up a $109 billion bill the Senate passed last week by a bipartisan, 74 to 22 vote.

"It's a good bill," Reid said. "But over in a big, dark hole we now refer to as the tea-party dominated House of Representatives ... they destroyed their own bill, and now they won't agree to take up our bill." House Republicans, he said, "are going to have to feel the heat of the American people."

GOP Rep. Mike Pence, who favors "devolution" of responsibility for transportation to state and local governments, said he's undecided about the five-year, $260 billion GOP bill because he's concerned that it isn't paid for entirely with user fees like fuel taxes and because he doesn't like the way it divvies up highway aid among states.

"I have no doubt the state of Indiana could do a better job for taxpayers and for drivers than the federal government in maintaining our roads in Indiana," said Pence, who is running for governor. "I supported the last highway bill. I think that roads mean jobs. But it's essential that we produce a bill that is both fair and fiscally responsible."

The House bill actually takes a large step toward giving states far more flexibility over how they spend federal aid, said Rep. James Lankford, R-Okla., a member of the House Transportation Committee. Currently, about 80 percent of state highway programs are paid for with federal aid and 20 percent with state money. Lankford, who is supporting the bill even though he also wants to cede more authority to the states, said he'd eventually like to see that ratio reversed.

Boehner, R-Ohio, blamed his difficulty in passing the bill on the House's ban on "earmarks" -- provisions that used to be tucked into bills that direct spending to lawmakers' pet projects.

"When it comes to things like the (last long-term) highway bill, which used to be very bipartisan, you have to understand it was greased to be bipartisan with 6,371 earmarks," Boehner told reporters. "You take the earmarks away, and guess what? All of a sudden people are beginning to look at the real policy behind it."

Boehner wants to use revenue from expanded oil drilling to help make up a shortfall between federal fuel tax revenues and transportation program spending. But the drilling proposal raises only about $4.3 billion over 10 years, while the gap between revenue and spending in his bill is more than $40 billion.

"The problem with the Senate bill is that it doesn't address the issue of rising gas prices and energy," Boehner said. "We believe that if we're going to reauthorize the highway bill, American energy production ought to be a critical part of it."

Several Republican lawmakers said they expect the Senate to go along with the House's 90-day extension despite Reid's hesitation.

[Associated Press; By JOAN LOWY]

Associated Press writer Andrew Taylor contributed to this report.

Follow Joan Lowy at http://twitter.com/AP_Joan_Lowy.

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