The FAST Act, America’s new highway bill, has been passed and signed into law. But lost in the complicated, labyrinthine story of its passing is, what does the bill really mean?
The National Stone, Sand and Gravel Association (NSSGA) offered a free webinar explaining the main components of the bill. Michael W. Johnson, NSSGA president and CEO, predicted that due to the bill, equipment sales to aggregates producers would pick up fast and production at aggregates operations would see a spike starting in the second and third years of the funding mechanism.
The seminar was conducted by Johnson, Pam Whitted, senior vice president legislative and regulator affairs; Jim Riley Sr., director of government affairs; Michele Stanley, director of government affairs; and Ashley Amidon, director of government affairs.
“This is significant legislation that stops 36 straight extensions of the highway program in this country,” Johnson said. “The last time we had a bill this long in highway transportation policy was 1998. It is long overdue.”
In simple terms, the FAST Act allows the construction industry to get back to work. It boosts highway spending by 15 percent and transit spending by 18 percent.
“The bill also makes meaningful steps to cut red tape and speed permitting so projects can get started more quickly,” Johnson said.
Whitted detailed the legislative landscape that led to the passage of the bill, and revealed the names of the legislators who did not vote for it.
“We are going to have to do some real work with these members to make them understand the importance of this program,” Whitted said. “It is not republican or democrat, it is for America.”
The $305.5-billion bill contains total U.S. DOT Funding Authorization of:
- FY16–$58.3 billion.
- FY17–$59.8 billion.
- FY18–$61 billion.
- FY19–$62.5 billion.
- FY20–$64 billion.
“I can’t emphasize enough how much we have pushed for increased funding,” Whitted said. “And indeed we did get an increase in funding. Not as much as needed … but certainly better than we anticipated.”
Of the $305.5 billion, $281 billion represents the gross contract authority for highways over the five years of the bill. The rest of the monies will go to future general fund appropriations, the Emergency Relief Program and the Emergency Preparedness Fund.
Many people are asking how the bill is paid for. Over and above the amount that will come from the Highway Trust Fund, Congress tapped a variety of sources to make up the shortfall. These include, among others:
- $53.3 billion from the Federal Reserve surplus.
- $6.9 billion from a Federal Reserve dividend payment cut.
- $6.2 billion from the sale of oil from the Strategic Petroleum Reserve.
- $5.2 billion from indexing customs fees for inflation.
- $2.4 billion from allowing the IRS to hire private tax collectors.
Johnson noted that while the association is happy to see this bill, and the aggregates industry will take advantage of it, it should not be forgotten that the Highway Trust Fund, and the larger issues regarding its future solvency, were not addressed by Congress but will eventually have to be up the road.
But the good news, for right now, is that money is slated to move very soon. “You will start to see monies flow to the departments of transportation in 2016,” Johnson said.