President Clinton’s fiscal year 2001 budget proposal, to be released in February 2000, is expected to again redirect gas tax revenue to environmental programs. Currently, the Clinton Administration is seeking support from environmental groups to endorse a plan that redirects most of the additional gas tax revenues promised by TEA-21 to select environmental programs, rather than distributing the additional funds by formula to the states as TEA-21 directs. President Clinton included a similar proposal in his budget request last year, but Congress refused to adopt the President’s recommendations. Since Vice-President Gore has made the environment and “smart growth” major themes of his presidential platform, the proposal is likely to receive more attention this year. Last year, highway and transit groups opposed President Clinton’s proposal because it was not consistent with the promise of TEA-21. AGC will again lead efforts to oppose next year’s proposal.

EPA Proposed Rule Eliminates Conformity Grace Period: Published November 30, the rule would require areas cited for air quality violations to demonstrate to EPA that their transportation plans and projects conform with air quality goals before new projects could proceed. Previously states and localities had one year to comply before sanctions were imposed. The grace period (also known as the Grandfather clause) was an EPA regulation struck down by a court case in 1997 (Sierra Club v. EPA) AGC will submit comments. Comments must be received by December 31, 1999.

Highway Construction Costs Fall 8.1% in Third Quarter: According to the Federal Highway Administration, prices fell 8.1% compared with the preceding three-month period, and 3.7 % compared to one-year-ago levels.  FHWA cited a significant reduction (35.6%) in the cost of portland cement , and lesser reductions for structural steel (7.6%) and structural concrete (6%).

OSHA Will Not Extend Ergonomics Comment Period: OSHA published its proposed standard on November 23^rd and the comment period ends February 1, 2000.   Despite requests to extend the comment period, OSHA argued for speed in the process and pledged to make the rule final within a year.

EPA Publishes Storm Water Rule: On December 8, 1999 EPA published the Phase II storm water regulation in the Federal Register.  This will require construction sites disturbing over one acre of land to obtain a storm water permit.  Sites that disturb less than one acre of land but are near an impaired body of water may also be required to get a permit.  States have three years in which to rewrite the Construction General Permit.  The final rule can be accessed through the AGC website at http://www.agc.org/.

Candidate Bush Pledges to Abolish the Death Tax: Last week George W. Bush unveiled his plan to provide $483 billion of tax relief over five years and pledged to abolish the death tax. Bush’s plan states that the death tax is the antithesis of the American dream and impedes economic growth because much of the capital formation in America occurs through estates.  Death tax elimination appears to enjoy support among the other Republican candidates including John McCain and Gary Bauer who specifically advocated death tax elimination during a Republican candidates debate this week.

Court Clarification Clears Way for Arizona Highway Construction: An October court ruling shut down more than 50 new highway projects in Arizona valued at nearly $1 billion. The court injunction was issued in an endangered species case involving the Pygmy Owl in southern Arizona. In the case, Defenders of Wildlife (a Washington DC based group dedicated to "the protection of all native wild animals in their natural communities") filed suit, saying that the Army Corps of Engineers had issued wetlands permits without taking into account the impact of its permits on the range of the Pygmy Owl. In other words, no owls were harmed. But the permits being issued could have impacted suitable habitat for the endangered owls.  AGC of Arizona worked with the Arizona Congressional Delegation and their state DOT to seek the clarification from the Court.