Senate passes big boost for housing, transport

WASHINGTON Thu Sep 17, 2009 5:07pm EDT

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WASHINGTON (Reuters) - U.S. housing and transportation projects would receive a big spending boost under legislation passed by the Senate on Thursday, overriding Republican concerns about increased spending in the face of record budget deficits.

The Democratic-led chamber voted 73 to 25 to boost spending by 23 percent for highway repairs, air traffic control, rental assistance and other housing and transportation

programs.

Republicans Senators John McCain and Tom Coburn were unable to strip out nearly 600 individual spending projects, from highway improvements to theater renovations, that other lawmakers had earmarked for their home states.

Critics complained that these projects were unneeded and some even wasteful. Backers noted that they amounted to less than 1 percent of the $67.7 billion in the legislation and said they allowed Congress to keep a measure of control over federal spending.

The Senate will have to reconcile its bill with a similar one, costing $68.8 billion, passed by the House in July before sending it on for President Barack Obama to sign into law.

Congress is unlikely to finish work on other must-pass spending bills that fund government agencies before the new fiscal year starts on October 1.

Senate Majority Leader Harry Reid said lawmakers will have to pass a temporary spending measure before then to keep the lights on.

Republicans scored a victory by stipulating that none of that money could go to the Association of Community Organizations for Reform Now, a liberal grassroots group active in affordable-housing programs.

ACORN has been embarrassed recently by conservative activists who taped employees in several cities giving tax and housing advice to a couple posing as a pimp and a prostitute.

The bill includes $1.2 billion for high-speed rail projects, a key priority of the Obama administration, which comes on top of $8 billion approved in February as part of the $787 billion stimulus package.

It also increases housing assistance to help those struggling with the foreclosure crisis and the worst recession since the 1930s.

It allocates $150 million to the Washington, D.C., subway system, which has been reeling from a crash that killed nine people in June.

(Editing by Cynthia Osterman)

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