US House Democrats Unveil $825B Stimulus Package; $46.75B Direct Spending on Vehicles and Transportation Infrastructure
16 January 2009
Democrats in the US House of Representatives unveiled their $825-billion recovery package, a combination of $550 billion in spending and $275 billion in tax cuts. Of the package, which covers a broad range of projects and investments, $46.75 billion is to be directly applied to the transportation sector, including on-road, rail, air and maritime segments. Of the direct transportation money, $30 billion (64%) is targeted at highway and bridge construction.
The bill also proposes $11.77 billion going to boosting scientific research across many fields. Of that, $1.9 billion is targeted directly at the US Department of Energy for basic research into the physical sciences including high-energy physics, nuclear physics, and fusion energy sciences and improvements to DOE laboratories and scientific facilities. $400 million is for the Advanced Research Project Agency-Energy to support high-risk, high-payoff research into energy sources and energy efficiency.
Another $11 billion is to be applied for research and development, pilot projects, and federal matching funds for the Smart Grid Investment Program to modernize the electricity grid. $8 billion for loans for renewable energy power generation and transmission projects is to be provided.
The economy is in a crisis not seen since the Great Depression. Credit is frozen, consumer purchasing power is in decline, in the last four months the country has lost 2 million jobs and we are expected to lose another 3 to 5 million in the next year. Conservative economist Mark Zandi was blunt: “the economy is shutting down.”
The economy is in such trouble that, even with passage of this bill, unemployment rates are expected to rise to between eight and nine percent this year. Without this bill, we are warned that unemployment could explode to near twelve percent. With passage of this bill, we will face a large deficit for years to come. Without it, those deficits will be devastating and we face the risk of economic chaos. Tough choices have been made in this legislation and fiscal discipline will demand more tough choices in years to come.—Report on The American Recovery and Reinvestment Act of 2009
The US Senate is developing its own version of a recovery package. The congressional leadership is targeting delivering a bill to the President by the middle of February.
Among the transportation-related provisions in the American Recovery and Reinvestment Act of 2009 as proposed:
Advanced Battery Loans and Grants: $2 billion for the Advanced Battery Loan Guarantee and Grants Program, to support US manufacturers of advanced vehicle batteries and battery systems.
Electric Transportation: $200 million for a new grant program to encourage electric vehicle technologies.
GSA Federal Fleet: $600 million to replace older vehicles owned by the federal government with plug-in and alternative fuel automobiles that will save on fuel costs and reduce carbon emissions.
Alternative Buses and Trucks: $400 million to help state and local governments purchase efficient alternative fuel vehicles to reduce fuel costs and carbon emissions.
Diesel Emissions Reduction: $300 million for grants and loans to state and local governments for projects that reduce diesel emissions, benefiting public health and reducing global warming. This includes technologies to retrofit emission exhaust systems on school buses, replace engines and vehicles, and establish anti-idling programs. 70% of the funds go to competitive grants and 30% funds grants to states with approved programs. Last year EPA was able to fund only 27% of the applications received.
Highway Infrastructure: $30 billion for highway and bridge construction projects. It is estimated that states have over 5,100 projects totaling over $64 billion that could be awarded within 180 days. These projects create jobs in the short term while saving commuters time and money in the long term. In 2006, the Department of Transportation estimated $8.5 billion was needed to maintain current systems and $61.4 billion was needed to improve highways and bridges.
Transit ($9 billion total): $1 billion for Capital Investment Grants for new commuter rail or other light rail systems to increase public use of mass transit and to speed projects already in construction. The Federal Transit Administration has $2.4 billion in pre-approved projects.
$2 billion to modernize existing transit systems, including renovations to stations, security systems, computers, equipment, structures, signals, and communications. Funds will be distributed through the existing formula. The repair backlog is nearly $50 billion.
$6 billion to purchase buses and equipment needed to increase public transportation and improve intermodal and transit facilities. The Department of Transportation estimates a $3.2 billion maintenance backlog and $9.2 billion in needed improvements. The American Public Transportation Association identified 787 ready-to-go transit projects totaling $15.5 billion. Funds will be distributed through the existing formulas.
Amtrak and Intercity Passenger Rail Construction Grants: $1.1 billion to improve the speed and capacity of intercity passenger rail service. The Department of Transportation’s Inspector General estimates the North East Corridor alone has a backlog of over $10 billion.
Airport Improvement Grants: $3 billion for airport improvement projects that will improve safety and reduce congestion. An estimated $41 billion in eligible airport infrastructure projects are needed between 2007-2011.
Coast Guard Bridges: $150 million for ready-to-go investments to repair or remove bridges deemed hazardous to marine navigation, thereby removing obstructions and improving the safety of marine navigation.
Additionally, the bill proposes spending $200 million for enforcement and cleanup of petroleum leaks from underground storage tanks at approximately 1,600 additional sites. There are an estimated 116,000 sites with the potential to contaminate important water supplies.
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