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Senate Debates Economic Stimulus Package

February 6, 2009

By Tom Ichniowski
This story first appeared in Engineering News-Record

Capitol Hill action on an economic stimulus bill has shifted to the Senate floor, where on February 2 debate began on an $884.5-billion package of spending and tax breaks. The measure’s estimated $160 billion in construction-related spending appears safe, and Senate infrastructure advocates are trying to boost that total higher. But they probably will need to propose offsetting spending cuts to win approval for any increases.

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The first key floor vote, on February 3, didn’t go well for public-works supporters. Senator Patty Murray (D-Wash.) offered an amendment to add $25 billion to the bill’s $41.4-billion combined allocation for highway, transit, water, and sewer projects. But Murray didn’t propose any offsetting spending cuts; critics, nearly all Republicans, blocked her measure on a procedural vote. After that setback, one option being considered is proposing the amendment again, but with an offset, a congressional source says.

There may be other attempts to hike the Senate bill’s public-works spending. Senators Barbara Boxer (D-Calif.) and James Inhofe (R-Okla.) were considering offering an amendment to add as much as $50 billion to the bill’s combined allocations for highways, transit, and clean-water and drinking-water revolving funds. Boxer and Inhofe would get the increase by drawing on unobligated funds from other discretionary-spending accounts after 2009.

Sen. Christopher Bond (R-Mo.) was said to be mulling an amendment to convert the bill’s $5.5 billion in transportation grants to be awarded by the U.S. Transportation Secretary to highway funds that would be distributed by a current formula. Brian Deery, senior director of the Associated General Contractors’ highway and transportation division, says there are “mixed opinions” about the $5.5-billion discretionary grant program. He says supporters see it as a good way to help pay for large projects. On the other hand, having the Department of Transportation decide which projects to fund could slow the flow of money to the states.

In another infrastructure area, Sen. Mary Landrieu (D-La.) says she is working to double stimulus funds for Army Corps of Engineers civil-works projects, to about $9 billion. Landrieu says she voted against Murray’s amendment—the lone Democrat to do so—because it omitted an increase for the Corps.

GOP senators want other changes. Minority Leader Mitch McConnell (Ky.) favors adding mortgage-assistance and tax-cut provisions. “We think you ought to go right at housing first,” he says, mentioning a proposal to bring mortgage rates down to 4 percent. McConnell says there’s also GOP support for trimming the 15 percent and 10 percent personal income-tax rates by five percentage points each for those with incomes up to about $65,000. He may seek spending cuts, maybe in entitlement programs, to cover those costs.

When the Senate does finish its stimulus bill, it will have to be reconciled with the $819.5-billion package that the House passed on Jan. 28, by a 244-188 tally. No Republicans voted for it.

The House did add a couple of important construction amendments. One, offered by Jerrold Nadler (D-N.Y.), boosted funding for transit capital projects to $9 billion, from $6 billion, in the version that came out of committee.

The House also approved an amendment from Transportation and Infrastructure Committee Chairman James Oberstar (D-Minn.) to tighten the “use it or lose it” mandate for transportation stimulus aid. The amendment requires state agencies or other grant recipients to obligate half of their stimulus allocations of highway, transit and airport funds within 90 days, instead of 180 days under an earlier version of the bill.

The House-passed bill, but so far not the Senate’s, also requires that all the steel in stimulus-funded infrastructure projects be produced in the United States. The United Steelworkers union and U.S. steel groups support that provision, but the U.S. Chamber of Commerce and others oppose it. That “Buy-American” language may be a tough issue in coming House-Senate negotiations on the bill.

Democrats want to get a final stimulus measure to the White House by February 16. John Doyle, Waterways Council Inc. vice president for government affairs, says, “It’s pretty clear that is the target that the [Democrats’] leadership in the House and the Senate both are driving as hard they can to achieve, and of course what the President has asked to have happen.”

David Bauer, American Road & Transportation Builders Association senior vice president for government relations, says the deadline could be met, but “it’s going to be a challenge.”

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