States face reduced reimbursement in federal highways funds unless Congress acts soon says Tennessee Senate Majority Leader Mark Norris

July 20, 2009

States face reduced reimbursement in federal highways
funds unless Congress
acts soon says Tennessee Senate Majority Leader Mark

 (NASHVILLE, TN), July 20, 2009 — Tennessee and other states across the nation could face reduced reimbursements in federal highway funds by September if Congress does not act soon, according to Senate Majority Leader Mark Norris (R-Collierville), Chairman of the Council of State Government’s (CSG) Transportation Finance Committee.  Norris helped pen a resolution from CSG that called for Congress to pass an adequately funded multi-year transportation authorization bill as soon as possible.  He also traveled to Washington on behalf of CSG to talk to federal transportation officials and members of Congress regarding the urgency of the matter.

“Without action, states will again have to face the prospect of massive cutbacks in federal highway aid money going into the next fiscal year,” said Leader Norris.  “That is a scary proposition considering the challenges we face in all areas of state government as the economy continues to deteriorate and federal stimulus money dries up in 2010.”

According to federal transportation officials, the Highway Trust Fund is in danger of becoming insolvent by September unless it receives a $5 to $7 billion infusion to cover obligations through the end of the current fiscal year.  They also estimate that an additional $8 to $10 billion will be needed to cover an anticipated cash shortfall in fiscal year 2010.  Last year, Congress had to supplement the Fund by $8 billion to get through the budget year.

The CSG resolution says stimulus funds “fell far short of providing a historic commitment to improving the nation’s transportation infrastructure and represented only a small portion of the amount needed to make all the needed repairs and upgrades.”  The resolution also said CSG will partner with other organizations to advocate for a multi-modal, multi-year transportation authorization bill to include a focus on all modes of travel to improve the nation’s transportation infrastructure and create new construction jobs.

“I’m glad the Tennessee General Assembly didn’t authorize all the transportation bonds the governor asked for in his budget due to the uncertainty of this Fund right now,” added Norris.   “The federal funds we need to pay interest on these bonds may not be there unless Congress takes action soon. This is at a time when there is much focus on other legislation pending in Washington.”

Bredesen had requested authority for $350 million in bonded indebtedness this year at a cost of $35 million per year to be paid from federal funds.  Norris helped place a provision in the bill to take a year-to-year approach to make sure that federal funds are available to pay for the bonds.

“A sound transportation network is vital to our economy and quality of life,” he continued.  “States, which are already struggling, need to plan their budgets with some level of assurance that this money will be available for their transportation needs.  Hopefully, Congress will act soon to provide that stability as states already face tremendous economic challenges over the next several years.”


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