This Week in Washington

The Week Ending May 17, 2001

This weekly report is written by the American Society of Civil Engineers' Government Relations staff. If you have questions or comments about any items in this report, please contact Brian Pallasch, Michael Charles, Martin Hight, Austin Fulk, or Liz Hermsen or call 202/789-2200

Inside This Week:

• Tax Bill Includes ASCE-Supported Provisions
• President Bush Outlines National Energy Plan
• Major Education Bill Faces Delay
• Representative Working on Science Committee Education Bill
• School Construction Funding Offered on Senate Floor
• Railroad Improvement Bill Approved by House T&I Committee
• Federal Gas Tax Under Fire
• State Government Relations Update

Tax Bill Includes ASCE-Supported Provisions
The Senate Finance Committee has completed work on the Restoring Earnings to Lift Individuals and Empower Families Act 2001 (RELIEF Act) which specifies which taxes will be cut to achieve the $1.35 trillion envisioned in the Fiscal Year 2002 budget compromise. Included in the bill is the ASCE-supported extension of the Internal Revenue Code (IRC) Section 127, exemption for employer paid education expenses. To comply with the compromise budget act, all tax relief provisions would sunset on September 30, 2011.

Additionally, Senator Orrin Hatch (R-UT) intends to offer an amendment on the Senate floor to permanently extend the research and development (R&D) tax credit. The current research and development tax credit expires at the end of June 2004. The credit permits corporations to deduct R&D expenses from their taxes. Because the inclusion of the R&D extension would boost the cost of the tax cut beyond the agreed to amount of the budget resolution, the amendment would need 60 votes to pass.

  
President Bush Outlines National Energy Plan
President Bush unveiled a national energy strategy on May 17 in an effort to counter what the White House claims is "the most serious energy shortage since the oil embargoes of the 1970s."

The 105-point plan calls on federal agencies to take dramatic steps to reduce regulations on the energy industry to encourage more output from coal-fired plants, recommends the construction of more than 1,300 new power plants, and calls for new oil and gas exploration -- including some on federal lands that environmentalists and many in Congress believe should be off-limits.

The plan has angered environmentalists, who say they were excluded from talks in its development, but Bush said environmental considerations were part of the plan.

"[The plan] is tough in that it lays out the problems," Bush said.

The 163-page energy report suggests the country faces the worst energy crisis since the 1970s, and in addition to an array of incentives for the industry, also includes a package of tax and other stimuli designed to promote conservation, energy efficiency, and wider development and use of alternative and renewable fuels.

Among the 105 recommendations is a proposal to decide whether the United States should drop its ban on nuclear plants powered by reprocessed fuel. But another recommendation offers language that appears to favor ordering the auto industry to raise fuel efficiency standards. To view the report, go to http://www.whitehouse.gov/energy.

  
Major Education Bill Faces Delay
Conservatives in the House of Representatives are likely to delay consideration of H.R. 1, the Education bill, over their concerns about funding levels, school choice and other issues. The House of Representatives had originally planned to begin consideration on May 17.

The House of Representatives' Rules Committee has dealt a blow to the ASCE-supported Ehlers Amendment to strengthen math and science provisions of the bill. The Committee has ruled the amendment out of order and it will not be permitted to be offered on the House floor.

The Senate is moving ahead slowly with its consideration of education legislation, S.1. Some of the provisions included in the Ehlers Amendment are part of the Senate bill, including science testing.

  
Representative Working on Science Committee Education Bill
ASCE is working with House of Representatives' Science Committee Chair Sherwood Boehlert (R-NY) who is drafting legislation to revamp the math and science education programs of the National Science Foundation. Along with other organizations within the engineering, scientific and education community, ASCE is providing comments and information to Chairman Boehlert to assist him in crafting his legislation.

  
School Construction Funding Offered on Senate Floor
By a vote of 50-49, the Senate defeated an Amendment to the Education Bill, S.1 that would have provided $1.6 billion in emergency school repair funds. The measure was sponsored by Senator Tom Harkin (D-IA). ASCE's 2001 Report Card for America's Infrastructure gave the nation's schools the lowest grade, a D-. The full report card and issue briefs can be accessed at reportcard.

Senator Harkin is also expected to introduce a Senate companion bill to the Johnson-Rangel "America's Better Classroom Act," H.R. 1076. The legislation would provide up to $25 billion in interest payments for local school bonds. The text of the House bill can be found at http://thomas.loc.gov by doing a search "By Bill Number" on HR 1076.

Senator John Kerry (D-MA) is expected to offer the Johnson/Rangel bill as an amendment to the tax bill. That action is likely May 17 or early next week.

  
Railroad Improvement Bill Approved by House T&I Committee
The House of Representatives' Transportation & Infrastructure approved on May 16 a bill that would help improve railroad infrastructure. Representatives Jack Quinn (R-NY), Bob Clement (D-TN), and Spencer Bachus (R-AL) on March 14 introduced H.R. 1020, the "Railroad Track Modernization Act of 2001," to establish a grant program for the rehabilitation, preservation, or improvement of railroad track.

The legislation would direct the U.S. Department of Transportation (DOT) to create a program of capital grants to Class II and Class III railroads to rehabilitate, preserve, or improve railroad track used primarily for freight transportation to a standard that would accommodate 286,000 pound rail cars in a safe and efficient manner. Under the bill, railroad track includes roadbed, bridges, and related track structures. The maximum federal share for carrying out a project would be 80 percent of the project cost. The legislation authorizes $350 million per year from 2002 through 2004.

H.R. 1020 would also authorize the DOT to make grants to supplement direct loans or loan guarantees (including for paying credit risk premiums, lowering rates of interest, or providing for a holiday on principal payments) for projects primarily benefiting non-Class I freight railroad carriers.

ASCE supports H.R. 1020 because it is focused on improving the nation's rail infrastructure. ASCE believes that in the new competitive global economy, American prosperity depends on increased infrastructure investment to assure efficiency with which we produce, transport and market our goods and services.

  
Federal Gas Tax Under Fire
As gasoline prices have risen recently, some lawmakers are calling for repealing all or part of the federal gas tax. However, Senate Majority Leader Trent Lott (R-MS), who pushed hard last year for the Senate to cut the gas tax, is downplaying the chances for such a move this year. After discussing the issue with President Bush on May 14, Senator Lott said, "There are a lot of arguments against it, but it's one of the things we can consider."

Representative Richard Pombo (R-CA) introduced a bill, H.R. 1694, to repeal 4.3 cents per gallon of the federal fuel tax. House of Representatives' Judiciary Committee Chair James Sensenbrenner (R-WI) is pushing a bill, H.R. 1575, calling for a six-month suspension of the entire federal fuel tax (18.3 cents per gallon for gasoline and 24.3 cents per gallon for diesel). Senator Ron Wyden (D-OR) said the price of gasoline "is all that anybody is talking about at town meetings." Yet, he anticipates that Congress will not repeal the tax. "Most of my colleagues know that we have huge infrastructure needs," he said.

ASCE supports the federal fuel tax because although it is labeled as a tax, it is really a user fee -- it helps to ensure that highway users pay for highway programs. When motorists fill their gas tanks, they are helping to pay for the roads they drive on. Since gas tax revenues are directly deposited into a "Highway Trust Fund," any cut in those taxes would reduce highway funding. Moreover, the needs of American roads are significant. In ASCE's 2001 Report Card for America's Infrastructure (reportcard), roads received a grade of D+. In addition, if the fuel tax were repealed, the "savings" would not necessarily be passed on to the consumer at the pump because the tax is collected at the wholesale level and not directly at the pump. Decreases in the wholesale price of gasoline do not always lead to lower retail gas prices. The only guarantee would be that highway program funding would be cut; there would be no guarantee that consumer gas prices would decrease.

  
State Government Relations Update
ASCE provides updates on individual state government matters affecting civil engineers. For more information on the following item(s), or any other state government relations matters, please contact Austin Fulk, ASCE's Manager of State Government Relations, at (202) 789-2200 or via email at afulk@asce.org.

State Legislative Update
The following bills were recently introduced in state legislatures across the country. If you have questions about particular legislation, please contact Austin Fulk, ASCE's Manager of State Government Relations. These bills affect the civil engineering profession, but ASCE National has not taken a position on them unless otherwise noted.

California
A.B. 1511 would establish and modify requirements for leasing buildings to serve as school facilities.

S.B. 355 gives a construction purchaser the right to sue a builder or designer for construction defects, even if the defects have not caused injury or property damage.

S.B. 790 allows the state to either withhold for future disbursement or advance annual State Transportation Improvement Program (STIP) funds to better allow counties to budget for large capital transportation projects.

New Jersey
A.B. 3496 authorizes the issuance of $250 million in state bonds for bridge repair and rehabilitation.

Ohio
S.B. 77, which has been passed by the Senate and sent to the House, changes the requirements that firms must meet in order to provide engineering or surveying services.

South Carolina
S.B. 45 allows municipalities and counties to adopt only the latest version of various building codes.

Texas
H.B. 2337 modifies the requirements and provisions governing the practice of landscape architecture in the state.