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Congress averts highway 'cliff' ... for now

Lawmakers agreed to a stopgap fix to fund federal highway and bridge construction.
A view of Capitol Hill in Washington, D.C.
A view of Capitol Hill in Washington, D.C.

The Senate passed a last-minute fix to prevent funds from running out for federal highway and bridge construction.

The $11 billion highway bill passed the Senate on a 81 - 13 vote Thursday night, hours before the federal government said it would begin rolling back infrastructure funding to states as money dissipated from the Highway Trust Fund.

But the bill, which the House had passed earlier, only punts the problem to next year: The fix will keep federal infrastructure afloat until May 2015, when Congress will have to revisit the issue. It's also largely funded by a fiscal sleight-of-hand that allows employers to delay contributions to pensions -- a move that members of both parties have denounced as a budgeting "gimmick."

That's part of the reason Senate Democrats had opposed the House's approach to the highway bill. The Senate had previously passed a bill that would have only provided enough funding to last through December, in hopes that Congress would pass a long-term fix during the lame-duck session -- when Democrats would still hold the majority in the Senate as well.

But the House shot down the bill on Thursday, effectively forcing the Senate to pass its version as the clock ticked down: Not only were federal cuts poised to take effect on Friday, but Congress was also scheduled to break for August recess. 

Democratic Sen. Barbara Boxer of California expressed disappointment with the outcome but explained why she ultimately chose to support the House-passed bill.

"It's really sad because what we wanted to do was to take care of this problem this year, in this Congress, on our watch -- not kick the can down the road. That's what the House chose to do. It's most unfortunate and their pay-fors just were a lot of smoke and mirrors," Boxer, chair of the Senate Committee on Environment and Public Works, said on the Senate floor Thursday. "Having said all that, we all know that we really can't walk away from the Highway Trust Fund, we can't let it stagger and fall. Millions of jobs and thousands of businesses depend on it."

Originally, the main revenue source for the Highway Trust Fund was the federal gas tax. But tax revenues aren't enough now to keep the fund solvent. And rather than raise the gas tax -- which hasn't gone up in more than 20 years -- Congress has continued to rely on short-term fixes to address the funding problem.