Tuesday's debate on the FY 2002 transportation spending proposal (H.R. 2299) was marked by considerable discussion on the operation of Mexican motor carriers and concerns about truck safety (see related article). At the same time, points of order were successfully raised by House Transportation and Infrastructure Committee Chairman Don Young (R-AK) against provisions he maintained were legislative rather than appropriation-related.

The overall bill received praise in remarks by members on the House floor. "This bill is fair, it is balanced, it is bipartisan," House Transportation Appropriations Subcommittee Chairman Hal Rogers (R-KY) said. "It satisfies our national transportation needs to the best of our ability."

Young Raises Points of Order

During floor action Chairman Young said "while I may not agree with every choice made in the legislation, I do recognize (Rogers?) leadership and hard work, and it has resulted in an excellent bill." During the course of debate on the bill Young sought to strike bill provisions he claimed were legislative in nature and contrary to the provisions of the Transportation Equity Act for the 21st Century (TEA-21).

Some would have added funds for safety inspections of trucks crossing into the U.S. from Mexico. One stricken provision directed $56.3 million in Revenue Aligned Budget Authority (RABA) for inspection stations along the Mexican border. Another would have provided $18 million in RABA funds to the Federal Motor Carrier Safety Administration for more inspectors in four states. Young also successfully struck language that would have earmarked $13.9 million in administrative FMCSA funds for border-safety activities and audits.

"While I do support the object of the funding, strict safety inspections of Mexican trucks, I am concerned that opening up RABA to other purposes is not the appropriate manner in which to solve this problem," Young remarked.

Also struck out was a shift of $50 million from the Clean Fuel Bus formula grant program to the bus discretionary program, along with a waiver of the statutory requirement for distributing funding under the Job Access and Reverse Commute program.

Also struck were elements Young said were in violation of the Aviation Investment and Reform Act for the 21st Century (AIR-21). They included a of $56 million in airport improvement program (AIP) funds for administrative purposes and a shift of $10 million in AIP money to help cover costs of the Small Community Service Development Program. Young said he supports that program, but he was not successful in his attempt to move general funds to SCSDP.

Rep. C.L. "Butch" Otter (R-ID) successfully sought removal of a provision to let the Federal Aviation Administration accept funding from some airport sponsors to help cover staff costs for environmental reviews.

Next Steps

With House approval of the transportation appropriations bill, all eyes are on the Senate. Ongoing organizational disagreements there between newly majority Democrats and former majority Republicans make it unclear when that chamber will begin to move on spending bills. Observers already predict that Congress will be debating FY 2002 spending bills long after the current fiscal year ends September 30.

Freer U.S. movement of trucks originating in Mexico and Canada was part of the North American Free Trade Agreement, or NAFTA, which was adopted in 1993. However, concerns about the safety of trucks originating in Mexico prompted administrative action during the Clinton Administration to restrict such trucks to zones within 20 miles of the U.S. border, even though such trucks were to meet U.S. safety standards. Freer movement of the trucks also has been strongly opposed by the Teamsters Union.

President Bush had sought to lift the sanctions effective next January to improve U.S.- Mexican relations, and said on Wednesday he will try to reverse the House action, according to Reuters. The ban affects about 9,000 trucks.

The amendment, offered by Rep. Martin Olav Sabo (D-MN), Ranking Member of the Transportation Appropriations Subcommittee, continues the current restrictions. It was supported by a coalition of Democrats and Republicans.

Rep. Sabo introduced a similar amendment during markup of the bill by the Appropriations Committee on June 20. That amendment would have required Mexican trucks to meet the same safety standards as U.S. trucks. The Committee instead chose alternate language offered by Transportation Appropriations Subcommittee Chairman Hal Rogers (R-KY), which would have required safety audits of Mexican trucks within 18 months after operating in the U.S.

In February, an arbitration panel ruled that the Clinton administration policy violated NAFTA. The U.S. Department of Transportation, in keeping with President Bush's expressed desire to increase Mexican truck access to the U.S., proposed that Mexico-based trucking companies file paperwork to back vehicles' safety records before they would enter the U.S. The administration also proposed the hiring of 80 new safety inspectors at border crossings.

Funds for the 80 inspectors, however, were removed from the bill on the House floor, on grounds the language amounted to legislating in an appropriations bill, which is prohibited under House rules.

Reactions

The adoption of the Sabo amendment caught many off guard, particularly the Bush Administration, which is trying to expand NAFTA implementation. In a June 19 letter to House Appropriations leaders, Deputy Secretary Michael Jackson noted that the Administration would oppose language that would prevent granting Mexican carriers permission to operate in the U.S. unless certain safety inspections are completed.

"This legislation," said Oberstar, "will help our nation join Japan, France, Germany, Spain, Italy, Sweden and other industrialized countries of the world in recognizing the potential of high speed rail." Houghton declared that "this bill is critical to getting high-speed rail projects started across the country and liberating our Nation's highways and airways from increasingly serious congestion."

H.R. 2329, which has 125 co-sponsors, is the House counterpart to legislation introduced in the Senate earlier this year (S. 250) which as yet has seen no action. The House bill does not contain the preemption of state and local taxing authority contained in the Senate bill. It does have a provision stating that state matching contributions (not less than 20 percent of the cost of a project) "shall not be derived directly or indirectly, from Federal funds, including any transfers from the Highway Trust Fund."

The Office of Inspector General (OIG), in a report delivered June 21 to U.S. Transportation Secretary Norman Mineta, states that "despite improved revenues and ridership, Amtrak's financial condition remains serious." OIG urged that Congress hold hearings on Amtrak's future early in 2002 rather than waiting until later in the year, when they were previously scheduled.

"Amtrak's revenue and ridership have grown steadily in the past 2 years, and in the first 6 months of 2001, Amtrak's passenger revenues are up 11.8 percent over the same period last year, and ridership is up 7 percent. Still, expense growth has kept pace, and as a result, Amtrak's cash losses have not declined," OIG stated.

Those cash losses stood at $561 million in 2000 B an $18 million improvement over 1999, but still $120 million worse than Amtrak had projected.

A major driver of that expense growth is interest cost, as Amtrak has gone further into debt in recent years to finance new equipment, the report states. In September 2000, Amtrak's long-term debt and capital lease obligations totaled $2.8 billion B an increase of $1 billion over 1999, the report stated.

Another component is continuing capital needs that "far exceed the federal appropriations Amtrak anticipates receiving" in 2002 and 2003, OIG writes. "Deferred investment is beginning to catch up" and service may decline as a result.

Expected revenues have failed to materialize, in part, because of late delivery of 20 new "Acela" increased-speed trains Amtrak has been rolling out in recent months to improve service in the Boston-to-Washington corridor, OIG said. However, Amtrak has expanded its non-passenger business, including mail and express package carrying, to 43 percent of its total revenues in 2000, up from 29 percent a decade earlier. In 2000, such revenues totaled $886 million.

Warrington Optimistic

Amtrak's financial situation was discussed during a hearing of the Senate Transportation Appropriations Subcommittee on Thursday, where President and CEO George Warrington expressed optimism that the company could achieve operational self sufficiency by the end of 2003. He stated that Amtrak has made progress and "is fixated on cutting costs."

"While this mandate is very challenging and even supporters of intercity passenger rail have had doubts that it can be met, we have, in fact, made progress toward the goal and I believe we will achieve it," he said.

Warrington noted that $59 million of the $521 million provided by Congress for Amtrak in FY 2001 supports operations, while $40 million will be used for operations in FY 2002. He maintained that recent cost increases, due to the initiation of the Acela line and mail delivery services, will help to improve service in the long run.

Senators questioned Warrington about the recent mortgage of Penn Station to generate $300 million to help cover operating costs for the remainder of the year. He said that rather than come to Congress "hat in hand," he chose the option any private company would have available.

Ranking Member Richard Shelby (R-AL) maintained the action by Amtrak was a result of the company's inability to keep operation costs from growing. When asked by new Subcommittee Chair Patty Murray (D-WA) if the company is at risk of going bankrupt next year if $521 million is provided to Amtrak for FY 2002, Warrington responded "no."

Subcommittee members remarked that Congress needed to come to grips with Amtrak's future direction. "What do we want to invest to keep it viable?" remarked Commerce Committee Ranking Member John McCain (R-AZ). McCain said a national debate on the costs and extent of national passenger rail service was needed, and lamented that a majority of Amtrak routes "suffer millions of dollars of losses annually."

Sen. Joseph Biden (D-DE) said the state of Amtrak was the fault of Congress, which has not provided enough federal support. Biden was especially upset that Congress has refused to allow states to use Highway Trust Fund money to help Amtrak. "Bless me Father for I have sinned. I have thought about using Highway Trust Fund money for Amtrak," he said.

"Too few roads, runways and an aging U.S. port system are costing the economy billions of dollars every year," Chamber President and CEO Thomas Donohue told a news conference. "Airport delays and traffic jams cause more than frustration B they cause disruptions to the flow of goods and services in an economy that relies on just-in-time delivery."

Members of the coalition include state and local chambers plus transportation user groups, builders and other associations. Donohue said the new coalition will fight for investment in infrastructure and for shortening delays that currently slow the delivery of infrastructure to the public. The campaign expects to spend at least $1 million over the next year to get its message across.

During a luncheon on Tuesday Donohue outlined the specific goals of the new coalition, including building public and political support for transportation funding; fully dedicating revenues from user fees for transportation purposes; and streamlining the environmental approval process for projects. He predicted heavy coalition involvement in highway, transit and aviation reauthorization bills.

The Associated Press, in reporting on formation of the group, quoted AASHTO President E. Dean Carlson as saying "The approval process for new highway projects has broken down. It takes too long. It costs too much. It's too complex. And it's too easily sidetracked by small groups of determined opponents."

In remarks to the Chamber House Transportation and Infrastructure Committee Chairman Don Young (R-AK) said work was under way on environmental streamlining measures affecting transportation projects. "We have a package of legislation ready," Young said. "Streamlining is the first priority."

Donohue said demand for transportation is growing, and "is not going to fall with a growing population and a growing economy," he said. "Cars and trucks should be moving people and products, not idling in traffic adding pollution to the environment."

Though the justices' opinions were divided on different aspects of the case, filed by landowner Anthony Palazzolo of Rhode Island, the upshot is that a government may be required to compensate some landowners who face restrictions on development of their property due to environmental regulations. Legal experts told the Post that Thursday's ruling clears a path for some landowners to seek compensation for the "taking" of land even when the regulations were in place before the ownership was assumed.

A five-member majority of the high court, overruling lower courts, found that Palazzolo's claim was "ripe for review" that could lead to compensation; however, another majority agreed with lower courts that Palazzolo had not fully demonstrated that he had been deprived of all economic use of his land, as he contended. The latter issue has been remanded to the lower courts.

Palazzolo had purchased 18 acres of undeveloped salt marsh in the town of Westerly on the Rhode Island coast, the Post reported. The property helped prevent the flooding of a pond one-fourth of a mile inland from the ocean and was used as refuge and spawning ground for birds, fish and shellfish.

The landowner, who over several decades had sought to build houses or a recreational beach facility on the land, originally owned it with a group of other holders but took sole ownership in 1978. The regulations affecting use of the property had been in effect since the mid- 1960s and early 1970s.

The tentative pact, announced Monday by the Transport Workers Union, comes as AMR Corp. B a Texas-based holding company that also owns Trans World Airlines B has just announced a second-quarter loss of more than $100 million. The contract has been under negotiation since October and covers wages plus benefits, retirement and work rules. The proposed contract also speaks to pay and working conditions for fleet service clerks, dispatchers, and other ground-service workers.

"By requiring drivers to put down their cell phones and pay attention to the road, this new law will help make our roads safer and save lives, " Pataki said at the outdoor signing ceremony in a Manhattan park.

The ban imposes fines of up to $100 on drivers who use cell phones without a hands-free device, except when making emergency 911 calls. The second violation carries a $200 fine; additional citations run $500 each.

The ban goes into effect this November, but officers will issue warnings for the first month. Violators could get their tickets dismissed up until February if they show the judge a receipt proving they have purchased hands-free cell phone equipment.

Crow served as the chair of the Oklahoma Transportation Commission, and has been its District Five commissioner since 1995. The businessman was a state senator from 1968 to 1982, and chaired several committees, including Agriculture, Appropriations and Budget, and the Joint House and Senate Budget Committee. Crow holds a bachelor's degree in education from Oklahoma State University, and taught in public schools from 1957-1965.

Locke told the Seattle Post-Intelligencer that the third session will be solely devoted to transportation.

The governor and legislative transportation negotiators proposed a five-cent-per-gallon statewide gas tax increase to create billions in revenue for congestion relief. After nearly six months of dead-end negotiations, Locke recently changed his position that voters must approve the sizable increases to gasoline and other taxes, stating that legislators should approve the increase without them. The P-I reports Locke's decision was partly based upon pressure from such area corporations as Microsoft and The Boeing Co. to ease congestion on the state's overcrowded highways.

Voters would still decide on additional regional transportation improvement plans.

Before adjourning shortly before midnight on June 21, legislators passed a $3.4 billion "bare-bones" transportation budget for the upcoming fiscal biennium.

Minnesota Appears to Dodge Government Shutdown

After six months of deliberation that put Minnesota on the brink of a government shutdown, lawmakers on Thursday passed a bill that cuts taxes by $757 million and awards taxpayers $700 million from the state's 2001 surplus. Passage of the measure, which Governor Jesse Ventura is expected to sign, aids in final adjournment of the legislative session and avoidance of government shutdown on Sunday.

The annual $50 billion is based on data from the U.S. Department of Transportation's 1999 report to Congress on the condition and investment needs of the country's surface transportation system.

ARTBA's reauthorization proposal provides government officials with different options to fund the federal highway, bridge, and transit programs. The organization suggests a gas-tax increase, beginning in 2004, would likely be the most effective of the choices. Other options include drawing down the $45 billion FY 2009 balance in the Highway Trust Fund (HTF), cracking down on federal gasoline and diesel-fuel tax evasion, crediting interest earned on the HTF back to the fund, developing tax-exempt financing for transportation capital projects, ending the subsidy on ethanol-based motor fuel sales, and indexing federal fuel taxes to the Consumer Price Index.

The increase would raise an estimated $6.4 million in the next two years to apply to highway safety, municipal aid, highway and bridge improvements, and environmental protection. The Kennebec Journal reports that the supplemental highway budget relies on $14.5 million in revenue and $4.8 million in savings.

Tom Lulay, Executive Deputy Director of the Highway Division at the Oregon Department of Transportation, named as chair of the Subcommittee on Bridges and Structures for a two-year term, replacing David Pope of Wyoming who is retiring; and