White House issues one-year continuing resolution for the FAST Act

As the clock was ticking on the end of the fiscal year, with the immediate financial fate of the nation’s surface transportation authorization—the Fixing America’s Surface Transportation (FAST) Act—set to expire on September 30, the White House stepped in and signed a continuing resolution today, which will run through September 30, 2021, to ensure that funding remains in place.

While industry stakeholders largely expected things to play out this way, it still presents challenges, in that a new long-term authorization is still needed, but it is unlikely to occur until 2021, for many reasons, with the upcoming election being a primary one.

As previously reported byLM, the House and Senate appeared far apart on how to move forward on a bill that would replace the five-year FAST Act that was scheduled to expire on Sept 30.

The Senate Environment and Public Works Committee in July 2019 unanimously passed a $287 billion, five-year surface transportation bill. But three other Republican-led Senate committees — Commerce, Science and Transportation, Banking, Housing and Urban Affairs, and Finance — have sat on it and failed to act.

The Democratic-led House passed a five-year, $494 billion bill on July 20 without any Republican support. Senate Republicans have shown no interest in compromise on that measure.

An analysis from the American Association of State Highway and Transportation Officials (AASHTO) provided the following details on the continuing resolution, as it relates to the FAST Act:

• an extension of FAST Act funding and provisions from FY 2020 to all of FY 2021, including contract authority formula apportionments to states;
• a $10.4 billion general fund transfer to the HTF’s Highway Account and a $3.2 billion transfer to the Mass Transit Account;
• an increase to the “multimodal cap” within the U.S. Department of Transportation’s Infrastructure for Rebuilding America or INFRA discretionary grant program from $500 million to $600 million; and
• an extension of 2017 and 2018 Better Utilizing Investments to Leverage Development or BUILD grant program obligation deadlines through September 30, 2021

Two Washington, D.C.-based infrastructure experts toldLMthat this development was largely expected.

“Given the circumstances with this being a major election year, it definitely provides a lot of certainty in the coming months, because it gives the new Congress some time to work on significant legislation, when it reconvenes in January,” said Elaine Nessle, executive direction of the Coalition for America’s Gateways and Trade Corridors. “I sense that this will not be the first continuing resolution, because there are some high profile items that Congress wants to accomplish before the new Congress arrives, including a new COVID-19 stimulus, trade, and the Supreme Court nomination.”

As for what this means for supply chain stakeholders, Nessle said that the continuing resolution can be viewed as a good thing, in that it provides a level of certainty on the funding side, as well as also provides an opportunity to think outside the box.

“There is also a real chance that there may be an infrastructure element in a recovery package over the next 12 months,” she added. “Not only do we have the opportunity to think creatively about what that might look like, but we also can think in more traditional terms about the surface transportation authorization one year from now, and, of course the looming question that has been hanging over everyone’s head about how it will be paid for going forward. There will probably be some opportunities in the next Congress to look at it and address it in a bigger package, and we are going to have to be looking at the debt ceiling again and other pieces of legislation. Right now, it looks like the sky is the limit with the election unknown.”

Randy Mullett, principal of Mullett Strategies, a consulting practice focused on helping clients navigate the intricacies of Washington, DC in the areas of trucking, freight, sustainability, security, and safety, and longtime Government Relations and Public Affairs official for Con-way and XPO Logistics, said that this extension puts the important work of developing a new surface transportation bill beyond the election season, the holidays, the organization of the new Congress, a change (or not) of the Administration, and perhaps Covid.

“The extra time will also allow more thought to be given to the needs of a post-Covid transportation system,” he said. “This is particularly true around commuter rail and transit use, facilitation of increasing e-commerce, and how much do we need to increase highway capacity generally. Congress will also need to consider alternative funding with VMT (vehicle mile tax) down and fewer vehicles being purchased.”