Obama to press for action on transportation funds

Associated PressJuly 14, 2014 

— President Barack Obama is pressing Congress to make a long-term commitment to keep highway and transit aid flowing to states, but lawmakers appear headed for a short-term patch to sustain projects through next May.

Obama has proposed a $302 billion, four-year transportation spending plan that is paid in part by closing corporate tax loopholes.

The White House on Monday said it would support a smaller, $11 billion Republican House bill that finances transportation projects for nine months, but said in a statement that the legislation "does not address the continued need to pass a long-term authorization bill that creates jobs and provides certainty for cities, states and businesses."

A conservative group, the Club for Growth, on Monday staked out its opposition to the House measure, saying the plan is paid for with budget gimmicks and urged lawmakers to vote against it.

In a report released Monday, the White House Council of Economic Advisers said greater spending on infrastructure would help the construction industry, which has an elevated unemployment level of 9.9 percent. The report also said states and local governments were well positioned now to undertake capital projects because construction is cheaper and because the cost of borrowing through municipal bonds is at a historic low.

Obama will discuss the issue during remarks Tuesday at a facility in Virginia that tests new technologies for highway transportation. He'll also promote the need to invest in the nation's infrastructure Thursday during a trip to Delaware, where he'll announce an initiative to increase private sector investment.

The administration has warned that by early August the fund will no longer have enough money to cover promised aid to states, and the government will begin to stretch out payments. States have been told to expect a 28 percent reduction in aid on average.

The White House argues that the United States has fallen behind other major economies in its spending for transportation needs.

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