House Transportation Chair Reaches Deal with House Majority Leader

It was recently reported that House Transportation and Infrastructure Chairman Don Young has reached a deal with House Majority Leader Delay and others on critical transportation funding details concerning how highway dollars should be distributed to states. Young has promised Delay and lawmakers from donor states that the minimum guaranteed rate-of-return would rise from 90.5 percent to 92 percent in the surface transportation reauthorization bill.

The 92 percent deal is probably the closest percentage to equity that could be expected under the current level of funding. Although the details are still being worked out it is hoped that all donor states would immediately begin receiving 92 percent minimum rate-of-return, continuing over the life of the bill. This is considered a positive concession since the original equity discussion suggested that the rate-of-return would slowly escalate towards 95 percent by the sixth year, which may not have averaged 92 percent during the course of the bill. In addition, the scope of programs covered into the Minimum Guarantee calculation was agreed to be raised to TEA 21’s level of 92.6. This change is expected to be made as the House approves their bill – expected in early March.

For Michigan this increase would mean approximately $110 million more a year, which equates to approximately $1.04 billion annually.

Young and Senate Environment and Public Works Chairman Inhofe will initially pursue six-year reauthorization bills that authorize $284 billion from FY04 – FY-09, the same level advocated by the Bush administration in its FY06 budget request.