| WASHINGTON, July 31
WASHINGTON, July 31 The U.S. House of
Representatives on Thursday was poised to reject a Senate-passed
$8.1 billion measure to fund transportation projects through
2014 in a bid to force through Republicans' plans that would
extend funding until May.
The House's vote to send its $10.9 billion plan back to the
Senate, scheduled for Thursday afternoon, would raise the risk
that Congress fails to meet a Friday deadline to avert federal
funding cutbacks for road, bridge and rail transit construction
Congress is set to begin a five-week summer recess on
Friday, the day that the Department of Transportation has said
it will start reducing payments to states by as much as 30
percent from the dwindling Highway Trust Fund.
Lawmakers and transportation officials say that failure to
approve new funding would cause work slowdowns at the height of
summer road construction season and halt planning for new
projects, putting thousands of construction jobs at risk.
The House vote was engineered to "jam" the Senate,
Democratic aides said. With no legislative time left, senators
would be faced with a difficult choice: Accept the House plan as
is or face criticism for allowing the Highway Trust Fund to run
dry in August.
A temporary $10.9 billion transportation funding extension
through May 2015 seemed on a drama-free path toward approval
until Tuesday, when a Senate amendment cut the amount to $8.1
billion. Senate Democrats wanted the shorter extension to try to
force Congress to act on a long-term funding plan during the
post-election, "lame duck" session of Congress in November.
They argued that the House plan would put off action until
next year, creating a funding crisis at the start of a new
construction season and leaving decisions to the next Congress.
State transportation directors and business groups have been
clamoring for a long-term solution that would eliminate
uncertainty over the funding of road and rail transit projects
that benefit the heavy construction industry and its suppliers,
including Fluor Corp, Vulcan Materials, LaFarge
SA and Caterpillar Inc.
The Highway Trust Fund has suffered chronic shortfalls in
recent years as revenue from fuel taxes, unchanged since 1993,
have failed to keep pace with rising construction costs and been
hit by improved vehicle fuel economy. Some lawmakers have
advocated a fuel tax increase and believe this may be easier to
achieve after November's congressional elections.
The House funding plan relies heavily on a controversial
revenue source known as "pension smoothing" - an accounting
maneuver that allows companies to reduce near-term contributions
to employee pensions, thus increasing taxable profits.
It also would extend customs fees for another year, a
measure in common with the Senate bill.
But the Senate measure stripped out the pension smoothing
and substituted some other provisions to raise revenue by
improving tax compliance, such as increased reporting
requirements for mortgage interest deductions.
(Reporting by David Lawder; Editing by Cynthia Osterman)