House Republicans want $260 billion for infrastructure

U.S. House of Representative John Mica (R-FL), Chairman, Committee on Transportation and Infrastructure holds hearings on U.S. Airline Industry on Capitol Hill in Washington, D.C., June 3, 2004.

WASHINGTON (Reuters) - House Republicans will propose legislation on Tuesday calling for $260 billion in spending on transportation infrastructure for up to five years, an election-year proposal touted as a job creator in a tough economy.

Transportation Committee Chairman John Mica was due to formally introduce the measure and unveil details for funding road, bridge, and rail improvements at a news conference, his office said.

Additional elements could be tacked on by other committees in coming days, including a plan to authorize the Canada-to-Texas Keystone XL oil pipeline despite the refusal of President Barack Obama to advance the project.

While both Republicans and Democrats agree that Congress must lay out a new long-term blueprint for infrastructure improvements, finding the political common ground to do so in legislation has been difficult in a charged partisan climate and with elections looming in November.

Proponents say the highway bill would create tens of thousands of jobs in the hard-hit construction industry at time when unemployment is stubbornly high.

Transportation and engineering experts have said that the United States is woefully behind on infrastructure spending, especially on bridge repair.

States, which rely on federal reimbursements, have been clamoring for direction from Washington on how to plan and pay for big-ticket projects.

To meet their needs, states and local governments have relied on a string of temporary spending measures from Congress since the last long-term federal funding plan expired in September 2009.

The current temporary spending extension expires on March 31.

Mica's proposal is far less ambitious than infrastructure measures floated by Obama that went no where in Congress.

In his State of the Union address last week, Obama proposed that a portion of money saved from war spending be used for infrastructure development. Democrats unsuccessfully pushed a similar idea last fall as part of deficit reduction.

Mica's plan is likely to be adopted on a party line vote in the Republican-led House. A smaller, two-year bipartisan effort is making its way through the Democratic-controlled Senate.

To pay for Mica's proposal, the government would continue to tap a trust account funded by gasoline tax receipts. The Highway Trust Fund has shrunk in recent years due to more fuel efficient cars and trucks on the road and less driving overall by motorists in a rough economy.

A Congressional Budget Office report on Tuesday is expected to detail new erosion of the account, congressional officials said.

There are no plans by Republicans or Democrats to increase gas taxes to fortify the trust fund and House committees other than Mica's are expected to address the shortfall.

Republican leaders said in November they would propose lifting a U.S. ban on new offshore oil and gas drilling and use related royalties to at least help finance any shortfall in infrastructure spending.

The Obama administration has proposed a modest expansion of offshore drilling. But lifting the drilling ban stands virtually no chance of passage in the Senate.

Mica's plan is also expected to cut government "red tape" in the project approval process and encourage private-sector participation in financing and building infrastructure. The plan also seeks to allow heavier trucks on U.S. highways.

So far, the U.S. government has opened few doors to private investors who mainly seek new tolling or other revenue-raising opportunities to generate a return.

(Reporting By John Crawley; Editing by Eric Beech)