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President Obama releases proposed budget

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President Obama’s proposed US$4.1 trillion spending plan, which was released earlier this week, has confused surface transportation stakeholders. Despite the fact that the President is requesting US$43.3 billion for highways, in alignment with the figure set in the FAST Act, it also includes a proposed US$10 a barrel tax on oil for environmentally-friendly projects at the Department of Transportation.

The barrel tax equates to US$320 billion that would be used to shore up high-speed rail and mass transit options nationwide if Congress agreed. A barrel tax was one of the many funding options which the NSSGA supported to ensure the long-term stability of the Highway Trust Fund. However, the White House was silent on recommending any funding mechanisms for the five-year FAST Act, which was passed two months ago.

“We needed leadership from the White House in the months leading up to the FAST Act’s approval to properly invest in our nation’s infrastructure,” said Michael W. Johnson, NSSGA president and CEO. “Instead the President proposes a barrel tax two months later in his final budget to fund green transportation which neither fixes the Highway Trust Fund problem or moves our nation’s highways and bridges into the twenty-first century. Unfortunately, this proposal is both way too little and much too late.”

After a deal last fall that boosted spending by $80 billion over the next two years and raised the debt ceiling until March 2017, its very unlikely Congress will act on the plan. The President’s budget historically is only a blueprint that details how he would set priorities if he controlled the government’s purse strings, which he does not.

A National Infrastructure Bank would also be created by the proposed budget, to leverage non-federal dollars to finance energy, water and transportation projects. The proposed budget also cuts Army Corps budget by 22% while increasing spending on clean energy, education and Medicaid.

The U.S. House of Representatives and U.S. Senate appear to be proposing their own budgets, despite the earlier agreements, and will then move to consideration of the appropriations bills under regular order.

Adapted from press release by

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