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July 2000 |
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| Senate rejects gas tax repeal AGAIN (some
people never learn!)
The wook of July 10 was a busy one for AED on Capitol Hill. The
Senate was gearing up to consider an estate tax bill (H.R.8) that
passed the House of Representatives by an overwhelming majority last
month. The Senate vote was a big deal. AED has been working for
years with our allies in Washington to get an estate tax repeal bill
to the House and Senate floors and we anticipated a busy week
building last-minute support for the legistlation. But then came the
bad news...
Rumors began circulating that, despite having lost two votes on
the issue in April, Sen. Majority Leader Trent Lott (R-Miss.) wanted
to bring a temporary gas tax repeal proposal to the Senate floor
(again). The legislation in question, which was authored by Sen.
Spencer Abraham (R-Mich.) and cosponsored by GOP Senators Kay Bailey
Hutchison of Texas, Peter Fitzgerald of Illinois, and Rod Grams of
Minnesota, proposed to suspend the $.184-per-gallon gas tax for 150
days. The Senate GOP leadership announced July 12 that the gas tax
bill would be offered as an amendment to the estate bill when it was
considered on the floor the next day.
In a city where bad ideas are a dime a dozen, Abraham's gas tax
repeal bill was among the worst. Since 1997, all of the $.184 gas
tax-including the $.43 portion enacted for deficit reduction in
1993-is deposited into the Highway Trust Fund (HTF). Since the
enactment of the Transportation Equity Act for the 21st Century
(TEA-21) in 1998, all revenues paid into the HTF are used to fund
federal transportation programs. By even temporarily repealing the
$.184 tax, the funding stream for the federal highway program was
put in jeopardy and the HTF risked losing a whopping $18 billion
during the upcoming five months. Despite assertions by the bill's
sponsors that lost HTF revenues would be made up from the budget
surplus, as far as AED was concerned the Abraham bill was a direct
threat to the integrity of the budget firewalls enacted as part of
TEA-21 to protect the HTF. It was a chance we weren't willing to
take.
There was another problem with the Abraham proposal that, as our
conversations with lawmakers during the week revealed, amazingly
hadn't been considered. What would the public's reaction be when the
tax was reinstated and gas prices shot up $.184-per-gallon next
March? Although the public doesn't currently blame the federal gas
tax for high fuel prices, you can be sure they will next year. And
then, if pressure built for Congress to repeal the tax permanently,
the future of the federal highway program would be in real jeopardy.
In meetings with GOP leaders, construction industry
representatives were urged to embrace the temporary repeal bill and
recognize that it could help GOP candidates running in marginal
districts. AED emphasized the importance of the highway program the
nation, the danger of tinkering with the HTF firewalls, and the
political problems that would be encountered when the tax was
reinstated. We also echoed the theme we've been hearing from AED
members around the country in recent weeks: If the GOP is about
threatening the federal highway program, why should our industry
support Republicans? In the end, at least some of the people with
whom we spoke got the message.
Gas tax repeal defeated 59 to 40
The effort to attach
the Abraham amendment to the estate tax bill ultimately failed by a
vote of 59 to 40. Fifteen Republicans joined 44 Democrats (Sen.
Chris Dodd (D-Conn.) did not vote) to defeat the legislation.
The GOP senators who voted with us were:
Kit Bond of Missouri
Conrad Burns of Montana
Lincoln Chafee of Rhode Island
Thad Cochran of Mississippi
Susan Collins of Maine
Mike DeWine of Ohio
Pete Domenici of New Mexico
Michael Enzi of Wyoming
Chuck Hagel of Nebraska
Tim Hutchinson of Arkansas
Jim Jeffords of Vermont
Pat Roberts of Kansas
Craig Thomas of Wyoming
George Voinovich of Ohio
John Warner of Virginia
Hopefully this vote will be the final nail in the coffin of
efforts to suspend the gas tax, at least for a while. But, as we
suggested a few months ago, we clearly have work to educate a few
members of the Senate about the importance of the federal highway
program. A good place to start would be for AED members to call
their senators to either thank them for voting to protect the
Highway Trust Fund this month or to take them to task for voting to
jeopardize it. If you do this enough, after a while they'll know
you're watching and get the point!
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Estate tax repeal passes Senate 59 to 39
It was the icing on a busy, but successful week for AED in
Washington. On July 14, the Senate passed legislation to rid of the
federal estate tax during 10 years by gradually pulling down tax
rates. The Senate voted 59 to 39 to pass the Death Tax Elimination
Act (HR 8), which was approved by the House last month by 279 to 136
votes.
Estate tax repeal has been one of AED's top legislative
priorities for years. A survey of our members done a few years ago
found that the equipment industry alone spent more than $6 million
to set up estate plans to ensure that family-owned distributorships
survived the death of the current generation of owners, and that AED
members were spending more than $5 million a year to buy life
insurance to provide cash to pay estate taxes when they come due.
Our industry is also not alone. Thus, economy-wide, the estate tax
causes a massive diversion of capital to estate planning that could
otherwise be invested in businesses and add employees.
During the past several years, AED has been working with a
coalition of groups to build support for repeal on Capitol Hill. One
of our objectives has been to educate Democrats about the impact
that the tax has on minority-owned businesses and on the ability of
established companies to hire more workers. Those efforts are
clearly paying off. Last month 65 Democrats voted with us in the
House. This month, nine Democratic senators voted to rid the tax.
Unfortunately, there's one Democrat who continues to oppose
estate tax repeal: President Bill Clinton. The President has made
clear his intention to veto the estate tax repeal bill when it gets
to his desk. And despite the strong show of support in the House,
the Senate didn't pass the bill with enough votes to override the
veto.
That said, we've come a long way! The fact that both houses of
Congress have voted to repeal the estate tax, despite thin margins
of control by the GOP, suggests that we've made real progress and
that all the letters that AED members have written to their senators
and representatives urging repeal are having an impact. We're well
positioned to win once and for all on the estate tax issue after the
November elections. So don't lose heart. We're hopeful that the new
resident at 1600 Pennsylvania Avenue next year will see things our
way.
For now, let's consolidate and reaffirm the support we have for
repeal. The following 59 senators who voted to get rid of the death
tax deserve our thanks!
Abraham (R-Mich.) Allard (R-Colo.) Ashcroft (R-Mo.) Bennett
(R-Utah) Bond (R-Mo.) Breaux (D-La.) Brownback (R-Kan.) Bunning
(R-Ky.) Burns (R-Mont.) Campbell (R-Colo.) Cleland (D-Ga.) Cochran
(R-Miss.) Collins (R-Maine) Coverdell (R-Ga.) Craig (R-Ind.) Crapo
(R-Ind.) DeWine (R-Ohio) Domenici (R-N.M.) Enzi (R-Wyo.) Feinstein
(D-Calif.) Fitzgerald (R-Ill.) Frist (R-Tenn.) Gorton (R-Wash.)
Gramm (R-Texas) Grams (R-Minn.) Grassley (R-Iowa) Gregg (R-N.H.)
Hagel (R-Neb.) Hatch (R-Utah) Helms (R-N.C.) Hutchison (R-Texas)
Inhofe (R-Okla.) Kyl (R-Ariz.) Landrieu (D-La.) Lincoln (D-Ariz.)
Lott (R-Miss.) Lugar (R-Ind.) Mack (R-Fla.) McCain (R-Ariz.)
McConnell (R-Ky.) Murkowski (R-Ark.) Murray (D-Wash.) Nickles
(R-Okla.) Robb (D-Va.) Roberts (R-Kan.) Roth (R-Del.) Santorum
(R-Pa.) Sessions (R-Ala.) Shelby (R-Ala.) Smith (R-N.H.) Smith
(R-Ore.) Snowe (R-Maine) Stevens (R-AK) Thomas (R-Wyo.) Thompson
(R-Tenn.) Thurmond (R-S.C.) Torricelli (D-N.J.) Warner (R-Va.) Wyden
(D-Ore.)
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New DOT highway needs report finds conditions
improved, but more investment needed
The Department of Transportation last month released the most
recent version of its biennial report to Congress on the condition
of America's transportation infrastructure. According to the report,
1999 Status of the Nation's Highways, Bridges, and Transit:
Conditions and Performance, record levels of investment in roads,
bridges, and transit in recent years have had a positive impact on
highway safety and conditions, but that more investment will be
needed to ensure that conditions continue to improve.
In releasing the report, Transportation Secretary Rodney Slater
said that, "This report illustrates how our record levels of
investment have paid off in enhanced safety, which is our highest
transportation priority, and an improved transportation system. The
report also makes clear, however, more needs to be done."
The following are among the report's key findings:
The average annual cost to maintain physical conditions of
highways and bridges for the next 20 years is projected to be $56.6
billion by all levels of government in 1997 dollars. Capital
spending on highways and bridges would need to rise $9.2 billion
(16.3 percent) above 1997 levels just to maintain conditions. During
the life of the TEA-21, this investment shortfall is expected to
decline to $3.2 billion (5.7 percent).
The pavement condition of the nation's urban and rural highways
has improved overall in recent years. Since 1993, the percentage of
interstate road miles with acceptable ride quality has increased
from 91.2 percent in 1993 to 92.4 percent in 1997. The percent of
total road miles in poor condition dropped from 8.6 percent to 6.6
percent during that same period.
The condition of the nation's bridges has also improved. The
percentage of deficient bridges overall fell from 34.6 percent in
1992 to 29.6 percent in 1998. The interstate highway system has the
lowest percentage of deficient bridges, 16.4 percent in rural areas
and 26.8 percent in urban areas.
Most measures of traffic congestion show an increase during the
past several years. Travel density in terms of travel-per-lane mile
is clearly increasing. Delays increased on all highways between 1993
and 1997, rising from 8.3 to 9 hours per 1,000 vehicle miles
traveled.
The report is in many ways a political document designed to build
support for the Clinton administration's efforts to link
transportation and social policy. The following quote is typical:
"People in low-income households have fewer travel options and a
much smaller radius of access to goods and services than those in
higher income households. The high cost of acquiring, registering,
insuring and maintaining a vehicle places vehicle ownership out of
range for many low-income households." However, as in previous
years, the information provided by the report regarding road
conditions and investment needs should prove useful in helping our
industry to continue to make the case on Capitol Hill for strong
federal infrastructure programs.
To read the report, visit the DOT's Web site,
www.fhwa.dot.gov/policy/1999cpr/index.htm.
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House Votes to Block EPA Air Standards
The House of Representatives voted June 21 to pass legislation
blocking enforcement of the Environmental Protection Agency's new
air quality standards on a bipartisan vote of 226 to 199.
The amendment to the House version of the Veterans
Administration, Housing and Urban Development, and Independent
Agencies appropriations bill would prevent the EPA from designating
additional areas as being out of compliance with the ozone and
particulate matter standards that the agency promulgated in 1997.
Being designated as a "nonattainment area" triggers a series of
sanctions for localities, including the loss of federal highway
money.
The amendment, sponsored by Reps Mac Collins (R-Ga.) and John
Linder (R-Ga.), comes in response to recent developments in the case
challenging the EPA's new air standards. In May of 1999, the U.S.
Court of Appeals for the District of Columbia Circuit upheld a lower
court's decision that the standards were unconstitutional in a case
brought by construction industry and business community groups.
Earlier this year, the Supreme Court granted certiorari in the case
and will hear arguments during the Court's next term, which begins
in October.
Despite the lower court rulings, EPA began notifying states a few
months ago that they had to begin designating areas that are not in
compliance with the new standards by June 30, or the agency would
make the designation itself. The Collins amendment is therefore an
effort to stop the agency from ignoring the courts and implementing
a misguided and unconstitutional regulation.
It is hoped that parallel language will be included in the Senate
version of the VA, HUD appropriations bill when it is considered
later this summer.
Election Outlook 2000: AED gears up to ImPACt
2000
It's been a busy few weeks for AED's Political Action Committee.
In addition to attending a construction industry fundraiser for Sen.
John Warner (R-Va.), we've been working with our allies in the
National Stone Association and National Utility Contractors
Association to organize a series of events to support the reelection
of pro-growth members of the House. So far this month we held
fundraisers for Reps Jennifer Dunn (R-Wash.), J.C. Watts (R-Okla.),
Asa Hutchinson (R-Ark.), Ellen Tauscher (D-Calif.), Mike Simpson
(R-ID), Ray LaHood (R-IL), and Phil Crane (R-IL). Planning is
underway to hold events for Representatives Sherwood Boehlert
(R-NY), Tom Davis (R-VA) (the chairman of the National Republican
Congressional Committee), Don Young (R-AK) (the likely next chairman
of the House Transportation & Infrastructure Committee), and
Nick Joe Rahall (D-WV).
However, the centerpiece of AED's election year activities is our
ImPACt 2000 local group fundraiser program, through which AED PAC
works with AED members to organize meetings between distributors and
candidates at the local level. At each event, AED PAC contributes
$2,500 to the candidates and challenges local group members to match
that amount with personal contributions.
So far this election cycle AED members have held events for
Representative Anne Northup (R-KY), Senator John Ashcroft (R-MO),
and GOP House Candidates Mike Rogers (R-MI) and Chris Vance (R-WA).
Several other local group events are in the works. The Georgia
Equipment Distributors Association is planning a lunch for
Representative Charlie Norwood (R-GA) in Atlanta on October 23rd.
The Memphis Associated Equipment Distributors are holding an event
for Rep. Ed Bryant (R-TN) on August 22nd. And the Montana EDA is
holding a luncheon for House Candidate Denny Reberg (R) on August
15th. Many other local groups are in the process of selecting
candidates and organizing their events. We'll keep you posted.
For information on organizing an ImPACt 2000 event in your area,
call AED's Washington office at (703) 739-9513 or email
caklein@aednet.org.
The Senate last month passed estate tax repeal legislation. Find
out how your senators voted.
Our nations highways are getting better but more needs to be done
just to maintain current conditions, a new DOT report finds.
The House has passed legislation to block EPA from implementing
its new air standards.
Election Outlook 2000: AED PAC is working with our allies in
Washington and AED members around the country to help elect
pro-growth candidates to Congress. |
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More
information about AED's Washington activities is available at:
AED's
Government And Public Policy Information Resources page.
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