U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

57–634PDF 2010

RECOVERY ACT: PROGRESS REPORT 

FOR INFRASTRUCTURE INVESTMENTS 

(111–133) 

HEARING 

BEFORE THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

SECOND SESSION 

July 27, 2010 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JAMES L. OBERSTAR, Minnesota, Chairman 

NICK J. RAHALL, II, West Virginia, Vice 

Chair 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

GENE TAYLOR, Mississippi 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

MICHAEL A. ARCURI, New York 

HARRY E. MITCHELL, Arizona 

CHRISTOPHER P. CARNEY, Pennsylvania 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

STEVE COHEN, Tennessee 

LAURA A. RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

SOLOMON P. ORTIZ, Texas 

PHIL HARE, Illinois 

JOHN A. BOCCIERI, Ohio 

MARK H. SCHAUER, Michigan 

BETSY MARKEY, Colorado 

MICHAEL E. MCMAHON, New York 

THOMAS S. P. PERRIELLO, Virginia 

DINA TITUS, Nevada 

HARRY TEAGUE, New Mexico 

JOHN GARAMENDI, California 

HANK JOHNSON, Georgia 

JOHN L. MICA, Florida 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

VERNON J. EHLERS, Michigan 

FRANK A. LOBIONDO, New Jersey 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

JOHN BOOZMAN, Arkansas 

SHELLEY MOORE CAPITO, West Virginia 

JIM GERLACH, Pennsylvania 

MARIO DIAZ-BALART, Florida 

CHARLES W. DENT, Pennsylvania 

CONNIE MACK, Florida 

LYNN A WESTMORELAND, Georgia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

BRETT GUTHRIE, Kentucky 

ANH ‘‘JOSEPH’’ CAO, Louisiana 

AARON SCHOCK, Illinois 

PETE OLSON, Texas 

TOM GRAVES, Georgia 

(II) 

(III) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... v 

TESTIMONY 

Duit, James A., President, Duit Construction Company, Inc., Edmond, Oklahoma, on behalf of the American Concrete Pavement Association .................. 26 

Gannon, Kevin, Vice President, Northeast Asphalt Inc., on behalf of the 

American Road and Transportation Builders Association ................................ 26 

LaHood, Hon. Ray, Secretary, U.S. Department of Transportation .................... 6 

Macleod, Brian, Senior Vice President, Gillig, LLC, Hayward, California ......... 26 

Millsap, Steve, Assistant Vice President, Structures, BNSF Railway Company ....................................................................................................................... 26 

Schneider, Bill, President and Cheif Executive Officer of Knife River Corporation, on behalf of the National Stone, Sand and Gravel Association ............... 26 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Mitchell, Hon. Harry E., of Arizona ....................................................................... 60 

Oberstar, Hon. James L., of Minnesota ................................................................. 61 

Richardson, Hon. Laura, of California ................................................................... 66 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Duit, James A. ......................................................................................................... 70 

Gannon, Kevin ......................................................................................................... 80 

LaHood, Hon. Ray .................................................................................................... 92 

Macleod, Brian ......................................................................................................... 97 

Millsap, Steve ........................................................................................................... 101 

Schneider, Bill .......................................................................................................... 111 

SUBMISSIONS FOR THE RECORD 

Committee on Transportation and Infrastructure, Majority Staff: .....................

Chart entitled, ‘‘Bridges Improved by Recovery Act Highway and 

Bridge Funds’’ ............................................................................................ cvii 

Chart entitled, ‘‘Miles Improved by Recovery Act Highway and Bridge 

Funds’’ ........................................................................................................ cvi 

Chart entitled, ‘‘T&I Committee Transparency and Accountability Information by State and Formula Funding under the American Recovery and Reinvestment Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by T&I Committee (Data Reported as of June 

30, 2010)’’ ................................................................................................... xcvii 

Chart entitled, ‘‘T&I Committee Transparency and Accountability Information by State under the American Recovery and Reinvestment 

Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by 

T&I Committee (Data Reported as of June 30, 2010), Percentage 

of Allocated Funds Associated with Project Stages, Clean Water State 

Revolving Fund’’ ........................................................................................ cv 

Chart entitled, ‘‘T&I Committee Transparency and Accountability Information by State under the American Recovery and Reinvestment 

Act of 2009 (P.L. 111-5) (Recovery Act) Submissions Received by 

T&I Committee (Data Reported as of June 30, 2010), Percentage 

of Allocated Funds Associated with Project Stages, Highways and 

Bridges’’ ...................................................................................................... civ 

Report entitled, ‘‘The American Recovery and Reinvestment Act of 2009 

Transportation and Infrastructure Provisions Implementation Status 

as of July 16, 2010’’ ................................................................................... xv 

Page

IV 

Millsap, Steve, Assistant Vice President, Structures, BNSF Railway Company, response to request for information from Hon. Napolitano, a Representative in Congress from the State of California ....................................... 108 

v 


Insert offset folio 1 here 57634.001
vi 


Insert offset folio 2 here 57634.002
vii 


Insert offset folio 3 here 57634.003
viii 


Insert offset folio 4 here 57634.004
ix 


Insert offset folio 5 here 57634.005
x 


Insert offset folio 6 here 57634.006
xi 


Insert offset folio 7 here 57634.007
xii 


Insert offset folio 8 here 57634.008
xiii 


Insert offset folio 9 here 57634.009
xiv 


Insert offset folio 10 here 57634.010
xv 


Insert offset folio 11 here 57634.011
xvi 


Insert offset folio 12 here 57634.012
xvii 


Insert offset folio 13 here 57634.013
xviii 


Insert offset folio 14 here 57634.014
xix 


Insert offset folio 15 here 57634.015
xx 


Insert offset folio 16 here 57634.016
xxi 


Insert offset folio 17 here 57634.017
xxii 


Insert offset folio 18 here 57634.018
xxiii 


Insert offset folio 19 here 57634.019
xxiv 


Insert offset folio 20 here 57634.020
xxv 


Insert offset folio 21 here 57634.021
xxvi 


Insert offset folio 22 here 57634.022
xxvii 


Insert offset folio 23 here 57634.023
xxviii 


Insert offset folio 24 here 57634.024
xxix 


Insert offset folio 25 here 57634.025
xxx 


Insert offset folio 26 here 57634.026
xxxi 


Insert offset folio 27 here 57634.027
xxxii 


Insert offset folio 28 here 57634.028
xxxiii 


Insert offset folio 29 here 57634.029
xxxiv 


Insert offset folio 30 here 57634.030
xxxv 


Insert offset folio 31 here 57634.031
xxxvi 


Insert offset folio 32 here 57634.032
xxxvii 


Insert offset folio 33 here 57634.033
xxxviii 


Insert offset folio 34 here 57634.034
xxxix 


Insert offset folio 35 here 57634.035
xl 


Insert offset folio 36 here 57634.036
xli 


Insert offset folio 37 here 57634.037
xlii 


Insert offset folio 38 here 57634.038
xliii 


Insert offset folio 39 here 57634.039
xliv 


Insert offset folio 40 here 57634.040
xlv 


Insert offset folio 41 here 57634.041
xlvi 


Insert offset folio 42 here 57634.042
xlvii 


Insert offset folio 43 here 57634.043
xlviii 


Insert offset folio 44 here 57634.044
xlix 


Insert offset folio 45 here 57634.045
l 


Insert offset folio 46 here 57634.046
li 


Insert offset folio 47 here 57634.047
lii 


Insert offset folio 48 here 57634.048
liii 


Insert offset folio 49 here 57634.049
liv 


Insert offset folio 50 here 57634.050
lv 


Insert offset folio 51 here 57634.051
lvi 


Insert offset folio 52 here 57634.052
lvii 


Insert offset folio 53 here 57634.053
lviii 


Insert offset folio 54 here 57634.054
lix 


Insert offset folio 55 here 57634.055
lx 


Insert offset folio 56 here 57634.056
lxi 


Insert offset folio 57 here 57634.057
lxii 


Insert offset folio 58 here 57634.058
lxiii 


Insert offset folio 59 here 57634.059
lxiv 


Insert offset folio 60 here 57634.060
lxv 


Insert offset folio 61 here 57634.061
lxvi 


Insert offset folio 62 here 57634.062
lxvii 


Insert offset folio 63 here 57634.063
lxviii 


Insert offset folio 64 here 57634.064
lxix 


Insert offset folio 65 here 57634.065
lxx 


Insert offset folio 66 here 57634.066
lxxi 


Insert offset folio 67 here 57634.067
lxxii 


Insert offset folio 68 here 57634.068
lxxiii 


Insert offset folio 69 here 57634.069
lxxiv 


Insert offset folio 70 here 57634.070
lxxv 


Insert offset folio 71 here 57634.071
lxxvi 


Insert offset folio 72 here 57634.072
lxxvii 


Insert offset folio 73 here 57634.073
lxxviii 


Insert offset folio 74 here 57634.074
lxxix 


Insert offset folio 75 here 57634.075
lxxx 


Insert offset folio 76 here 57634.076
lxxxi 


Insert offset folio 77 here 57634.077
lxxxii 


Insert offset folio 78 here 57634.078
lxxxiii 


Insert offset folio 79 here 57634.079
lxxxiv 


Insert offset folio 80 here 57634.080
lxxxv 


Insert offset folio 81 here 57634.081
lxxxvi 


Insert offset folio 82 here 57634.082
lxxxvii 


Insert offset folio 83 here 57634.083
lxxxviii 


Insert offset folio 84 here 57634.084
lxxxix 


Insert offset folio 85 here 57634.085
xc 


Insert offset folio 86 here 57634.086
xci 


Insert offset folio 87 here 57634.087
xcii 


Insert offset folio 88 here 57634.088
xciii 


Insert offset folio 89 here 57634.089
xciv 


Insert offset folio 90 here 57634.090
xcv 


Insert offset folio 91 here 57634.091
xcvi 


Insert offset folio 92 here 57634.092
xcvii 


Insert offset folio 93 here 57634.093
xcviii 


Insert offset folio 94 here 57634.094
xcix 


Insert offset folio 95 here 57634.095
c 


Insert offset folio 96 here 57634.096
ci 


Insert offset folio 97 here 57634.097
cii 


Insert offset folio 98 here 57634.098
ciii 


Insert offset folio 99 here 57634.099
civ 


Insert offset folio 100 here 57634.100
cv 


Insert offset folio 101 here 57634.101
cvi 


Insert offset folio 102 here 57634.102
cvii 


Insert offset folio 103 here 57634.103
(1) 

RECOVERY ACT: PROGRESS REPORT FOR 

TRANSPORTATION INFRASTRUCTURE INVESTMENTS 

Tuesday, July 27, 2010 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

WASHINGTON, DC. 

The Committee met, pursuant to call, at 10:08 a.m., in room 

2167, Rayburn House Office Building, Hon. James Oberstar [Chairman of the Committee] presiding. 

Mr. OBERSTAR. The Committee on Transportation and Infrastructure will come to order for the purpose of the twentieth in our series of hearings on the Recovery Act. This hearing today marks 

1,000 hours of hearings the Committee of Transportation and Infrastructure has held in the 110th and 111th Congresses; 308 hearings, 2,144 witnesses, and our twentieth in the series of oversight 

and accountability hearings on the Stimulus Act, which I committed to do when I advocated for a substantial investment in the 

Nation’s infrastructure as part of a stimulus program to put Americans back to work, rebuild our highways and bridges and transit 

systems, aviation and waterway systems, and all that makes America move and produce. 

These jobs created by this extraordinary investment—and I 

would just point out that in September of 2008, this Subcommittee 

reported and the House passed a stimulus bill. Our portion of it 

was $30 billion. It was a much more modest program than we ultimately enacted. It was to accelerate funding out of the Highway 

Trust Fund to give States a 2-year respite from paying their 20 

percent matching share, so that, in fact, there would be 100 percent funding, but ultimately the States’ share would have been reclaimed from future revenues out of the Highway Trust Fund. 

Passed the House. We had substantial Republican support; Mr. 

Mica was an advocate for that legislation. And unfortunately, the 

President threatened to veto, the Senate stalled in its consideration, and no progress was made until after the election. 

We had a change, a change in direction, a change in leadership, 

and President-elect Obama said, we need to put America back to 

work. He supported what we had advocated from our Committee 

and even more. So February 17, the stimulus was signed into law, 

then State DOTs went to work. 

I just observe that, and further observe, that in 1956, when 

President Eisenhower signed the interstate highway legislation in 

June of 1956, by September State DOTs were at work. They 

2 

weren’t called DOTs, they were called highway departments at that 

time, and projects got under way. 

We actually moved much faster than in 1956 under this stimulus, because the State DOT agencies were ready, the Federal 

Highway Administration was ready, the U.S. Department of Transportation under the leadership of this great Secretary was ready. 

Since then we have 17,024 highway, transit and wastewater 

projects under construction, $32.7 billion, 86 percent of the total 

available formula funds. Project work has been completed on 6,920 

projects, totaling $5.3 billion. All 50 States have signed contracts 

worth 100 percent of their Recovery Act wastewater projects. Forty 

States have signed contracts up to 90 percent of their Recovery Act 

highway funds. 

During the first year of implementation, these projects created 

350,000 direct, on-project jobs. Total employment, and we will hear 

it later today, from the sand and gravel pit operators, Readimix, 

the asphalt operators, the steel service sector producing rebar, and 

guardrails, and I-beams and fenceposts, all that created additional 

jobs in the supply chain that reached 1.2 million jobs. So in total 

the cumulative effect is that we have payroll expenditures of $3 billion. Those workers are paying $610 million in Federal taxes alone, 

and those workers on the job site have avoided $509 million in unemployment compensation checks. That is putting America back on 

the road to recovery. 

Much more needs to be done, but we are under way. If we had had $300 billion, as I have said many times in many venues, instead of a tax cut for people, we would have 6 million jobs this 

summer. 

But nonetheless, the investment made shows great results: 

18,718 highway, transit and wastewater projects in all 50 States; 

$35 billion under contract; 92 percent of the total formula funds 

available for our highway, transit, and wastewater projects under 

way; 50 States, 5 territories, the District of Columbia have signed 

contracts for 18,000 projects, totaling $33 billion. That is 88 percent of the funds. Work has begun on 17,000 projects in all 50 

States. Work has been completed already on 6,920 projects, totaling 

$5.3 billion. 

I say that, and it is important to emphasize the work completed, 

because there were the naysayers at the beginning of this stimulus 

initiative that it won’t work, they don’t outlay, the outlays won’t 

come fast enough to do any good. Well, ask those 1.3 million people 

on job site who are working now about things not—they are working. They have jobs, and projects have been completed. 

The result is also impressive: 35,399 lane miles of highway improvement; 1,264 bridges replaced, restored, rebuilt, resurfaced; 

and 10 million metric tons of concrete poured or will be poured, resulting in revenues of $950 million for the Readimix and its cement 

partner. 

Federal Transit Authority reports that transit investments resulted in rehabilitation or acquisition of 12,136 buses, rail cars and 

paratransit vans; 4,870 passenger facilities; 324 maintenance facilities. Amtrak will, when it has completed its work, have replaced 

1,300,000 concrete ties, 281,000 already completed, 60 Amfleet 

cars, 21 superliners, 15 locomotives, 270 stations. 

3 

Airports, the aviation investments resulted in 155 runway improvements at 139 airports, accounting for 11 million annual operations, that is, take-offs and landings; 83 taxiway improvements at 

78 other airports that accommodate 8.1 million annual operations; 

and 25 projects that modernize air route traffic control centers, 

where their air traffic controllers work, and many of those are 30 

and 40 years old, and they needed upgrades. 

In addition, the total projects announced beyond highway and wastewater treatment is 19,610 projects, totaling $62.9 billion. All 

50 States have met their requirement that 100 percent of the Clean 

Water State Revolving Funds be under contract within 1 year of 

enactment. They have met that goal. Clean water investments will 

upgrade and maintain publicly owned treatment works, mitigate 

nonpoint source pollution, promote estuary management for 64 million people. 

I would just note in my own State of Minnesota, which was allo- cated $73 million, the very creative work of our State Public Facilities Authority, Terry Kuhlman and Jeff Freeman, because of bids 

coming in 25 and 30 percent lower than design estimates, have leveraged those funds into a $510 million program. From the 73 million, they got four or five times as much investment as initially expected. And 58 Superfund sites, 155 of the 185 brownfield projects 

under way. The Corps of Engineers has committed $3.9 billion for 793 

projects. The Corps will repair or improve 155 lock chambers, and 

improve the harbor and waterway channels that serve 2,400 commercial ports. Of course, also under way on 1,132 flood risk management projects to improve dam and levee safety and 1,000 other 

projects to maintain and update recreation areas. 

GSA has awarded contracts for 425 projects for upgrading of Federal buildings. The U.S. Economic Development Administration has 

broken ground on $122 million for 54 of 68 planned projects, and 

the U.S. Coast Guard Bridge Alteration Program has begun four 

planned bridge projects totaling $142 million. 

It is breathtaking, in about a year and 4 months. And for those 

who want us to believe that the recession started on January 21st, 

2009, that 7 million people were laid off on January 21st, 2009, I 

say, nonsense. The recession started in December 2007, and we are 

beginning the job and made a great start on clean-up and putting 

America back to work and rebuilding its infrastructure. And yet I 

would observe that of those 35,000 lane miles of highway improvement, that represents 4 percent of the backlog of needs. Therefore, 

we have to move ahead with our long-term 6-year investment program. 

With those comments, I now welcome and yield to my good friend 

and colleague Mr. Mica. 

Mr. MICA. Thank you, Mr. Chairman, and thank you for convening this hearing. We had agreed to closely monitor the progress 

of stimulus. You kept your word, and this is—what is this, the 

twentieth? 

Mr. OBERSTAR. Twentieth hearing. 

Mr. MICA. So I think it is very worthwhile to examine where we 

have gone with the stimulus Recovery Act and particularly our portion of responsibility. 

4 

I am pleased to see our Secretary back. He is still smiling at me 

in spite of some differences of opinion that we have, Mr. Chairman, 

between the Secretary and the Committee, but I know his intent 

is the same as ours, and that is to get America working and get 

our infrastructure projects under way. 

I might give a word in recollection of our efforts. Mr. Oberstar 

and I came back even before stimulus legislation was before the 

Congress in January. We agreed in a bipartisan fashion to commit 

to a very robust, substantial infrastructure bill to be ready. The 

Speaker had asked to us do that. We met that request, we submitted it, and as we now learn as part of history, the money was 

cut by more than half that we had proposed for legislation. 

I had also suggested that one of the things that undermined us 

is when there was an evaluation, I guess it was the Congressional 

Budget Office and others looked at it and said it would be difficult 

to spend the money that we had proposed in the time frame we had 

proposed because of the various requirements, State and Federal 

requirements, to get money out. Actually I had proposed to the 

Senate speeding that process up. And it is ironic that they used 

that to cut the money in half. 

It is ironic that we sit here today with only—and again, I take 

it from the Web site of DOT and the administration, we have only 

30 percent of the Recovery Act money expended today. That is the 

latest figure that we have from your figures, 14.9- of the 48 billion 

actually spent and outlaid. Actually, Mr. Chairman, I think you 

cited obligated of 35 billion. We have figures of 37 billion, a little 

bit more than you had cited, has been obligated, although now we 

are facing issues of deobligation and also the problem of localities 

meeting their match. They have to work on a fiscally responsibility 

basis; we just keep printing money and adding to the deficit. 

The President had promised if we passed the stimulus bill—and 

I know he reached a compromise with his tax cuts, with the spending, I think a third. We ended up with about 7 percent for infrastructure, 63 billion of which the Secretary has a responsibility 

over some 48 billion. And I know he struggled and has done everything he can in an honest and, I know, a concerted effort to try to 

get this money out. 

I talked to State transportation secretaries and folks around the 

country, and they have indeed heard the Secretary and the administrations were to get the money out. But the simple fact is we 

have only gotten 30 percent out. The simple fact is we are going 

to have to find a way in the new transportation legislation to expedite this process, and we are going to have to find a way to get 

even money out there faster. Thirty percent just doesn’t cut it 18 

months afterwards. 

The scary thing about what has been reported today is that 

many of the jobs have already been completed. Did you hear the 

figures that the Chairman gave? Let me give you a little microcosm 

in Florida. Of 848 projects, 337 have already been completed. We 

are looking at about 40 percent of the projects already completed. 

The General Accounting Office states that 50 percent of the 

money that has gone out so far through DOT has been used for repaving. What does that tell you? It is simple: That money has alVerDate Aug 31 2005 11:17 Oct 25, 2010 Jkt 000000 PO 00000 Frm 00112 Fmt 6633 Sfmt 6633 P:\DOCS\57634.0 KAYLA
5 

ready been spent; those jobs have already been expended, so to 

speak. So it is worrisome and troublesome. 

Furthermore, according to the go GAO and other reports, four of 

out of five of the stimulus jobs created so far are government jobs. 

The Associated General Contractors report that, in fact, we have a 

20.1 percent unemployment in their industry, in the construction 

industry. So there is plenty of need, there is huge unemployment. 

The Obama administration said if we pass the stimulus, unemployment would not go over 8.8 percent. It, in fact, stayed, hovered 

right about 9.5 percent. My State of Florida, the current June unemployment, this is horrendous for Florida, one of our most viable 

economic States and national economic generators, we are at 11.4 

percent. So it is troublesome that, while well intended, we would 

hope that we could have done even better. 

Now, with most of the jobs in repaving, and the jobs already 

come and gone, and four out of five of the stimulus jobs in the public sector, another scary thing is about to happen at the beginning 

or middle of September: 585,000 jobs were folks that were hired for 

the census, those are all, again, government jobs, and those people, 

we are already hearing from them, now are going to be seeking unemployment compensation. 

So we tried to do better, Mr. Chairman. I worked with you in 

that effort. We gave it our full measure. We have intended to have 

more folks employed. The report you gave today does cite some increase in jobs, but some of those, again, I report, are temporary, 

and we are going to lose more in the overall picture. 

I haven’t even gotten into the teachers and what is happening to 

those folks who relied on stimulus dollars and were kept on for 

some time and now are being laid off in record numbers. And I 

guess it could have probably been worse, but we gave it our all. 

I am willing to roll up my sleeves. I think we have got to look 

at an expediting of getting this money out, whatever it takes. If we 

could build that bridge in your back yard in 437 days that collapsed between Minneapolis and St. Paul on an emergency basis, 

I declare it is a national emergency to get some of the 9.5 percent 

unemployed employed, and the 11.4 percent in my district, my 

State, working again, and the millions of people that want work 

rather than just a government—short-term government job or 

handout. 

So I will work with you from today through the next Congress 

that—both of us depending on the people to send us back—and 

with the Secretary—at least we know he will be here—and we will 

work with him in whatever position the voters cast us into to try 

to do even better. 

I yield back the balance of my time. 

Mr. OBERSTAR. I thank the gentlemen for those comments, and 

I state for the record that Mr. Mica was very participatory, very 

supportive of robust surface transportation investment for stimulus 

back in December. 

Mr. MICA. And I might say the Chairman and I were prepared 

to do a 6-year bill, didn’t comment on that. We are still committed 

to that. That is our goal. We are going to find a way to do it. I am 

sorry we have a temporary measure in place. He has my full commitment. We may have an intervening election, but whatever ocVerDate Aug 31 2005 11:17 Oct 25, 2010 Jkt 000000 PO 00000 Frm 00113 Fmt 6633 Sfmt 6633 P:\DOCS\57634.0 KAYLA
6 

curs, and even in the interim of a lame duck, whatever it takes to 

get that, because I believe that that 6-year bill will get more people 

to work than anything we could do in the United States Congress. 

I yield back. 

Mr. OBERSTAR. Six million jobs. And you are right, we reported 

that bill from Subcommittee and are ready to move on it. 

One thing that the green eyeshade folks at CBO and Office of 

Management and Budget don’t understand, that in the surface 

transportation program, the jobs actually precede the outlays. People are actually working. They put in a full week’s work; the contractor then bills the State; the State validates the work has been 

completed, pays the contractor, bills Federal Highway Administration, which then further validates that the State’s records are 

right, and then sends an electronic payment. 

The jobs precede the outlays. I think Mr. Summers now understands that. He has told me, I am an advocate for this program 

now. We just need to get the rest of that crowd at CBO and OMB 

to understand that the jobs are ahead of the expenditures and the 

outlays. 

And all those people—we heard from Joyce Fisk, the human face 

of stimulus, at this Committee hearing earlier this year. She was 

called back to work as a truck driver for Knife River Construction 

and has since had her health insurance reinstated because she and 

her husband both put the 600 hours back on the job and now are 

paying their bills, paying their mortgage, and sending their son 

Austin to summer camp. 

Mr. Secretary, welcome. Glad to have you here. Thank you for 

your relentless advocacy. And you have been a different kind of 

stimulus. You have been around the country stimulating State 

DOTs to get those projects out the door. So we look forward to your 

testimony. 

TESTIMONY OF HON. RAY LaHOOD, SECRETARY, U.S. 

DEPARTMENT OF TRANSPORTATION 

Secretary LAHOOD. Mr. Chairman, thank you, and thank you for 

your leadership on the stimulus program and to all those who have 

been strong supporters of the stimulus program. Thank you for allowing those of us at DOT to carry out the mandate that we were 

provided, and also to Ranking Member Mica and Members of the 

Committee. We are delighted to be here to talk about the progress 

in getting neighbors back to work. 

We are, in fact, making great progress. When President Obama 

and this administration took office, the country was facing the 

worst economic crisis since the Great Depression. When Congress 

passed, with your leadership and others on the Committee who 

voted for it, and President Obama signed the Recovery Act into 

law, we together began the heavy lifting of implementing the most 

significant jobs and infrastructure legislation since the New Deal. 

Here we are 18 months later, and you see the results: More than 

14,800 highway, rail, transit, aviation and shipyard projects in 

every State of the Union. Airport projects were first to leave the 

gate. A total of 326 were funded, and 70 percent of those are now 

finished. Not a bad record. 

7 

The of summer 2010 is the most productive Recovery Act season 

yet. For example, 6.5 times more highway projects are under way 

today than were under way a year ago. That is an increase from 

1,750 projects last summer to more than 11,250 this summer. 

While last summer’s efforts improved about 9,000 miles of highway, this summer’s efforts will improve 30,000 miles, the equivalent of 10 cross-country road trips. 

More importantly this major investment in rebuilding America is 

helping families weather the worst recession in generations. We 

are on track to hit 3.5 million Recovery Act jobs by the end of the 

year, at least 160,000 of which have already come from DOT-managed programs. These are not just statistics. I have traveled to 

some 80 cities and 30 States, and everywhere I go, people come up 

and thank us for the work that they now have and for the ability 

to take care of their families. 

The Recovery Act has created a very powerful ripple effect as 

contractors start buying new supplies and hiring new employees, as 

workers start spending more money, and their families have the 

ability to do what they need to do. And restaurants are also benefiting as well as many other community businesses. 

In Bear, Delaware, a woman named Tracy Capelli, owns a local 

restaurant, Capelli’s Subs & Steaks, located not far from Amtrak’s 

car restoration facility. Last year the business was so slow that 

Tracy had no choice but to lay off 10 employees. She was devastated. Then the Recovery Act helped Amtrak hire 50 new workers, nearly all of whom had previously lost jobs in the auto industry. Now that these workers have jobs, they also have lunch breaks 

and money for family dinners. In turn, Capelli’s Subs & Steaks is 

flourishing once again, and Tracy is planning to hire a dozen new 

employees for the fall season because of the Recovery Act. 

The same cycle occurs in communities across America and in sectors across the economy. Because of the Recovery Act, it is easier 

for countless folks to pay the rent, put food on the table, and prepare their kids for college. 

Now, we have a long way to go with unemployment higher than 

9 percent. Our work is far from over. But the Recovery Act is making a very real difference not just in bringing the economy back 

from the brink, but also in laying the foundation for long-term, sustainable growth and prosperity. We are grateful for the leadership 

of this Committee and the partnership that we have with the Committee, and we look forward to your questions. 

Mr. OBERSTAR. Well, I say, three cheers for Capelli’s Steaks & 

Subs. And Bill Montgomery at Swinerton Builders and Rhea 

Mayolo, those are the human faces for recovery. Thank you for personalizing. It is so reassuring to hear. 

I now yield to Mr. DeFazio, Chairman of the surface Subcommittee. 

Mr. DEFAZIO. Thank you, Mr. Chairman. 

Thank you for being here, Mr. Secretary. Thanks for your advocacy, and particularly I am appreciative of your initiatives on distracted driving. 

That said, I am perhaps going to raise some questions that will 

be a bit difficult. I saw the end of last week where you made a fairly definitive statement saying that for the indefinite future, you 

8 

could anticipate no new revenues in this administration, requesting 

no new revenues for the Highway Trust Fund. And I would just 

like to square that with the excellent work your Department just 

did recently. For instance, last week you announced that we have a $77.7 billion—B—billion-dollar backlog in transit. We know that this backlog is killing people. It has killed people here in Washington, D.C., 

and will kill people in other parts of the U.S. We have outmoded, 

obsolete, transit systems in a state of not very good repair. And our 

current investments will not even keep up the current state of poor 

repair and capital backlog, let alone begin to improve. 

We are investing now about 80 percent of what we need to invest 

just to maintain the existing systems in their current state of disrepair, and we are at about 60 percent or 50 percent of what we 

would need to improve the systems and performance. And that is 

not building new systems, that is just given the legacy systems. 

And there is a heck a lot of places in the United States where we 

need to build out new systems. You know the phenomenal demand. 

I guess I just have to wonder, and then we can go over to the 

highway side, we have 150,000 bridges that are obsolescent, either 

functionally obsolete or structurally deficient, 150,000 bridges; 

61,000 lane miles are in poor or fair condition on the National 

Highway System. We are investing about two-thirds of what we 

need to maintain the current state of disrepair; that is, it is getting 

worse. Same as with transit. And, you know, we would need an additional $96 billion per year to make all the costs beneficial highway improvements and eliminate the bridge backlog. It would also 

mean, where we are making those investments, millions of jobs 

across the country would be created. 

So I guess I am trying to square your advocacy. I know you are 

under constraints. I am not quite so sanguine as the Chairman is, 

having had his meeting with Larry Summers at the White House, 

economic team has come around on the value of infrastructure investment. I certainly haven’t seen any advocacy out of the White 

House for infrastructure investment. And when I list those needs, 

and I hear Mary Peters talking, which is saying, all we need is private-public partnerships and tolling, and then the Obama administration addition to that is an infrastructure bank, I just wonder 

how it is going to work. 

Let us take transit systems. There is no transit system in the 

world that makes money. We have this massive backlog just to 

bring it up to safe operating conditions. How are we going to do 

that? Are we going to double, triple, quadruple the fares and drive 

all the riders off? So how do you do that without any additional investment? 

And then on the roads, bridges and highways, 150,000 bridges, 

are we going to toll 150,000 bridges so we can rebuild them or 

bring them up to snuff? Are we going to toll the entire Federal 

Interstate System so we can begin to bring that system up to snuff 

and make the investments we need? 

I mean, Mr. Secretary, with all due respect, I know that you are 

constrained by the people you work for or with, but to say that 

somehow we are going to seriously address these issues through 

tolling, through private and public partnerships, and with an infraVerDate Aug 31 2005 11:17 Oct 25, 2010 Jkt 000000 PO 00000 Frm 00116 Fmt 6633 Sfmt 6633 P:\DOCS\57634.0 KAYLA
9 

structure bank, it is not going to get us there. I think that is very 

sad. 

This is more of a speech than a question, but certainly I will give 

you the courtesy of responding, but I just don’t see how those nostrums are going to begin to meaningfully address this huge, huge 

hole in the transportation infrastructure of the U.S. 

We have gone from being First World and the envy of the 

world—I kept saying Third World until my colleague Mr. 

Blumenauer said, you are insulting Third World countries. They 

are investing a higher percentage of their GDP in transportation 

than we are. So I have taken to calling us Fourth World; that is 

formerly First World, vaulting over the Third World countries to a 

system that is the envy of none. 

Secretary LAHOOD. Well, I can tell you this. There are people in 

the administration that get it when it comes to infrastructure, including the President. The economic recovery plan had $48 billion, 

8 billion times more than we ever had for high-speed rail. That was 

the President’s initiative. 

The idea that people at the other end of Pennsylvania Avenue 

don’t get it is not quite accurate. Right at the top, the occupant of 

the White House gets it. He knows that infrastructure investments 

will put people to work. That is why we received $48 billion. 

Everywhere that I have gone, Mr. Chairman, 80 cities, 30 States, 

what I have talked about is the fact that we want to work with 

Congress on the way forward for a transportation program. We 

support the lion’s share of what is in Mr. Oberstar’s bill. It is a 

good bill. The only thing that we need, the only thing, is about 

$450 billion. And you know as well as I do, the Highway Trust 

Fund is deficient, so I don’t know if the courage is around here to 

do something about that. 

So the reason that I talk about tolling, public-private partnerships, the infrastructure fund is because we need to think outside 

of the box about how we are going to do all the things that the 

President wants to do, that Ray LaHood wants to do, that you all 

want to do. 

Look, there is no disagreement about what the needs are in 

America. You have cited them very well, and I don’t disagree with 

that. I am on board. We love doing transportation projects at DOT. 

The people that work there love doing them. The President believes 

in it. We need to work together to find the resources to get a bill 

and to get the job done. If we do that, we are well on our way to 

meeting all of the needs that you so well stated. 

Mr. DEFAZIO. If I could, Mr. Chairman, I know you are indulging 

me in length of time, but if I could just focus and get to such a big 

subject. 

Transportation and Infrastructure was almost 4 percent of the 

stimulus, 4 percent. If we had eliminated the tax cuts and taken, 

you know, half or a third or a tenth of that money for transportation, we could have created a heck of a lot more jobs. 

But beyond that, just let us focus in on Chicago, because it is a small part of this, but they have about a $7 billion backlog on their 

transit system. Parts of the L are propped up with 2-by-4s. They 

are not 2-by-4s; they are like big wooden beams. That is great we 

make wooden beams in my district, but really it probably should 

10 

have steel support so it can go more than 4 miles per hour over 

those sections. It is pretty sad, and this is the President’s hometown. 

They received $240 million from the stimulus. They spent it in 

30 days. They said, well, we easily could have spent a billion dollars in 30 days, because all we did is take projects off the shelf that 

we haven’t been able to fund. And these are nice projects that have 

huge employment components because you are buying rail cars, 

and you are buying steel, you are buying computer systems, control 

systems. These have a huge multiplier effect. 

So I don’t see how tolling, public-private partnerships, or an infrastructure bank gets us there because transit systems lose 

money. So if we raise—if we theoretically raise the fares enough in 

Chicago to pay for backlog, people wouldn’t be able to ride the 

thing. There needs to be a Federal effort, Federal leadership on 

these issues, and, you know, I am glad we have an advocate in the 

White House, but somehow it hasn’t translated to, you know, a real 

like, OK, we have got to get this done, how are we going to do it? 

Oh well, throw out what Mary Peters said, tolling, private-public 

partnerships, and we will add on an infrastructure bank so people 

can borrow money that they can’t pay back. 

But anyway, I—— 

Mr. OBERSTAR. The gentleman’s time has expired with enthusiasm. 

Mr. Secretary, thank you for support for our bill. You said it 

many times, in many ways, in many places. I would just make an 

amendment, a small amendment, to your statement. We need $450 

billion, as two national commissions have recommended, but of that 

450- we really need only $140 billion more than is now coming into 

the trust fund, that is $20 billion a year. Surely we can sit down 

and figure out where that money will come from. 

Mr. Mica? 

Mr. MICA. Well, Mr. DeFazio has cited one of the needs, which 

is financing, and you also mention the 450-, and the Chairman has 

also reiterated that need. Are you prepared now to give us any recommendation? Are you going to continue advocating the gas tax increase as an administration policy, or do you have any ideas that 

you want to give us for raising that revenue? 

Secretary LAHOOD. Well, Mr. Mica, I have been in this job 18 

months. I think if you look at everywhere I have been and every 

speech I have given, I have never advocated a gas tax. The President is opposed to raising the gas tax. You well stated it, as others 

have: We have already 10 percent unemployment in America. People can little afford to buy a gallon of gasoline, let alone if we were 

to raise the tax on it. I do not advocate, the administration does 

not advocate, raising the gas tax. 

Mr. MICA. I think that your pronouncement—and I talked to 

some of the press earlier today basically on that subject and said 

that the gas tax is dead. I am glad to hear you join me in declaring 

it dead on several bases. 

First, we have had 18 months to consider that. Secondly, the 

elections are coming, and I think there is a conservative wave coming on both sides of the aisle. I think there will be conservative 

Democrats, and a much more conservative overall Congress, and 

11 

conservative Republicans. I think the last thing that people would 

do when they come back to Congress and the new session is to open 

the discussion around increasing the gas tax. I am pleased that you 

join me at least in facing that reality. 

I think we do have to look at other ways. Mr. DeFazio has recommended some; I am willing to look at all the others, a fair way 

to pay. I don’t believe and infrastructure bank like the administration—I think you proposed 25 billion for is it 5 years, I believe, or 

6 years? 

Secretary LAHOOD. It is about 4 billion a year. Well, 4- to 6 billion, somewhere in that range. 

Mr. MICA. I would agree with Mr. DeFazio, I think that that is 

a very small amount. If you take the projects—for example, transit 

projects in New York, we have got three $7 billion-plus tunnels. 

You can go to almost any community and find a multibillion-dollar 

list. 

When we asked Florida for a submission of projects that they 

would like to do, they give us $6.9 billion worth of projects of which 

they are going to get about 1.3 trillion—I am sorry, 1.3 billion. I 

wish we had that trillion figure. 

But in any event, the difficulty is also in trying to get the money 

out. I know you have made a sincere effort. You have hammered 

State secretaries and others and tried to get that money out. Would 

you be willing—now, Mr. Oberstar and I had a provision in our 

draft to speed up the time by about 50 percent of the processing 

time. And we have got to do something to get that money out there. 

Would you be willing to commit to us today that you would support 

the 50 percent? I would like to take it to cut it by three-quarters 

of the time, if possible. I know you haven’t seen the particular, but 

that is one of the issues that we face is getting the money out now 

or in 6 months. 

Mr. OBERSTAR. Would the gentleman yield? 

Mr. MICA. Yes. 

Mr. OBERSTAR. The references made by Mr. Mica to the provision 

in our bill reported from Committee for an Office of Project Expediting in both the Federal Highway Administration and Federal 

Transit Administration, with concurrent review of permitting by all 

of the responsible Federal, State, local agencies, get in the room together at the beginning of the project so that those mill and overlay 

projects that have taken 3 years could be done in 3 months, as we 

have seen with the stimulus. We have seen these projects expedited. And transit projects that take on average 14 years from idea 

to ridership could be done in 3 years instead of 14 years by concurrency of review and resolving bottlenecks. That is what is in our 

bill, and I think I have heard you reference that. So I yield now 

for you to respond. 

Secretary LAHOOD. Well, you all know that we changed the criteria for New Starts programs, which enables now a lot of different 

criteria to be considered, and it will short-circuit the amount of 

time. It will not take 14 years anymore for New Starts, and we 

were able to do that. 

Any time we can get money out the door quicker, we would like 

to do that. We are following the letter of the law, I would tell you 

that. We are doing what it says to do in the economic recovery plan 

12 

that was passed by Congress. So it is not for a lack of not wanting 

to get the money out quicker, it is for making sure that the money 

is spent correctly, that all the boxes are checked, that we are doing 

what Congress wanted us to do. 

Mr. MICA. Well, again, we tried in stimulus—the other body said 

not no, but hell no to speeding up the process, so we are all stuck 

in the mire of existing law regulations. 

But I want to go fast forward. We talked first about financing, 

and you agreed with me on the death of the increase in the gasoline tax. We talked a little about infrastructure bank, and, quite 

frankly, I didn’t get to finish my point, but I think we should be 

looking in the neighborhood of a $250 billion infrastructure bank 

and finding ways to dramatically increase the amount of money 

rather than 25 billion. 

Finally, on transit, Mr. DeFazio went into that a bit. We found 

the GAO indicated that only 1 percent of transit obligations were 

used for operating expenses. We gave them the ability to look at 

using up to 10 percent. 

Now, I had also advocated—we have seen the problems we have 

seen with safety, like in the Metro system. And these folks are also 

hard pressed because they have had ridership down, revenues 

down. And I have advocated that we add some flexibility in Federal 

money, and our first priority, you stated, and I stated, and Mr. 

Oberstar on every occasion has stated that safety is our number 

one priority, and yet we continue to prohibit those Federal monies 

to be used for safety. 

Are you willing to weigh—I don’t—are you willing to agree with 

us on some of that as a priority? 

Secretary LAHOOD. Well, we have promoted a transit safety bill. 

Mr. MICA. But you can’t use Federal money under current guidelines. Could we do that? Would you agree to doing that? 

Secretary LAHOOD. Well, if you look at our transit safety bill, we 

want you all to give us the authority to get into the transit safety 

business and to help transit districts have some opportunity to 

really work on—— 

Mr. MICA. The way your proposal is drafted, it still doesn’t allow 

the Federal funds to be used. And I would set that as a first priority and allow that money to be directed for those funds and specifically designate it for safety. 

Mr. OBERSTAR. That is a matter that we will have continued discussion with. 

Mr. MICA. OK. 

Mr. OBERSTAR. And we will pursue this. 

Mr. MICA. If the Secretary would support us, we could get that 

done in a whiz bang, and it is important. 

So I hope it is something you will think about, Mr. Secretary, 

and, again, we are pleased to have you here and work with you. 

I yield back. 

Mr. OBERSTAR. Before I yield to Mr. Schauer and the Chair to 

Mrs. Napolitano, I just make an observation on the gentleman’s 

comment about a conservative wave. I think that wave against the 

gas tax would come as a huge surprise to Dwight Eisenhower, who 

proposed the 3 cent user fee to launch the Interstate Highway Program and Federal Highway Trust Fund. It would come as a great 

13 

surprise to that archetype conservative Ronald Reagan, who signed 

a 5 cent increase in the gas tax, saying it is budget neutral; the 

users are paying for the system; it will cost the average user the 

equivalent of two shock absorbers in a year. It will come as a great 

surprise to that other conservative George H. Bush, who signed a 

5-cent increase in the user fee, with 2–1/2 cents of that going for 

deficit reduction for a while. 

I think that so-called conservative wave is going to turn out to 

be a little ripple, and people are going to come to their senses and 

say, this Highway Trust Fund, this user fee that has been in place 

for 54 years has been the most successful—outside of Social Security the most successful social and environmental and transportation investment in the history of the country and in the rest of 

the world. Other countries come and admire what we have done 

with the Highway Trust Fund and our financing system. And we 

are going—I think we are going to see this turn around. 

At this point I yield the Chair because I have to run off to another event. 

And Mr. Schauer is recognized. 

Mr. SCHAUER. Thank you, Madam Chair. 

Mr. Secretary, thank you. Particularly I want to begin by thanking you for your Buy American efforts and support of American 

manufacturing as it relates to new railcars and rolling stock. I am 

fully with you, and we will be pushing legislation to make things 

in America. Thank you. 

I would like to change the subject, though, something you may 

know about. Sunday night or Monday morning in my district, a Canadian pipeline failed, leading to a spill of a million gallons or 

more of crude oil into Talmadge Creek near Marshall, Michigan, 

not far from my hometown of Battle Creek. The Enbridge pipeline 

has migrated into the Kalamazoo River. Some residents have been 

evacuated, and fish and birds have been killed. I never would have 

imagined an oil spill in my district in southern Michigan. The environmental impact could be devastating. 

My staff on scene is assisting with locating sites for the remediation effort, and I want to let any residents out there that may be 

watching, they can contact me at my district office toll free at 

(877)737–6407 for assistance. 

Mr. Secretary, in a disaster like this, after very heavy rainfalls 

we have experienced, every second counts. My goal is to make sure 

that every necessary resource is brought to bear to contain the spill 

and minimize its impact. 

There is a Superfund site, you may know, Mr. Secretary, about 

35 miles downstream to the west in Kalamazoo County. This oil 

cannot, must not get to that site and mix with the PCBs that are 

present there. 

I have personally contacted all Federal agencies and the company responsible, Enbridge, to express the deep concerns of the 

people of Calhoun County and press them to swift action to stop 

the spill, clean it up, and ensure there is no long-term impact from 

this spill. I will accept nothing less. 

Mr. Secretary—and I am getting to a question, or more a comment than question, there is an embedded question. I spoke to the 

Deputy Secretary yesterday and again this morning, to the PHMSA 

14 

Administrator yesterday, as well as to a number of her staff. I will 

have a number of questions that I will put in writing for you later 

today and ask for your response about the timelines of this incident, and PHMSA’s response, Enbridge’s safety record, PHMSA’s 

inspection of this pipeline, and Enbridge’s maintenance record of 

this pipeline. 

This is an emergency situation, I think you would acknowledge, 

and I ask that you commit every necessary resource along with 

other agencies on the ground, EPA, Coast Guard, Fish and Wildlife, and ask that you commit every necessary resource to aggressively respond to this crisis. 

Secretary LAHOOD. We will commit every available resource. We 

view this as a very serious situation, and I think, as you have stated, I think people are very surprised that something like this could 

happen in this part of the State. And we will commit every resource we can, and every person that needs to be there will be 

there, and we will answer every question and be very transparent 

about whatever issues you want to bring to us. 

Mr. SCHAUER. Thank you, Mr. Secretary. I appreciate it. It is— 

there are—in addition to the ecological impact that we are already 

seeing, my office is actually helping find space for agencies to deoil birds. Marshall, Michigan, we are talking about. 

Secretary LAHOOD. Sure, uh-huh. 

Mr. SCHAUER. There is benzene in the air, EPA is on the ground, 

some folks have been evacuated, and the situation is being monitored very carefully. Certainly my top priority is to make sure that 

every resource is committed to aggressively attack this spill, but 

then we have got to find out why it happened, and I look forward 

to working with you. 

Secretary LAHOOD. Exactly. We will work with you. 

Mr. SCHAUER. Thank you, Madam Chair, and I yield back. 

Mrs. NAPOLITANO. [Presiding.] Thank you. 

Mrs. Miller. 

Mrs. MILLER OF MICHIGAN. Thank you. It is nice to have two 

women sitting here, an unusual thing. 

Mr. Secretary, welcome. We are delighted to see you here, appreciative of your remarks and the job you have done, and we appreciate your service to the country for that. 

Secretary LAHOOD. Thank you. 

Mrs. MILLER OF MICHIGAN. Mr. Secretary, you and I have had 

this conversation in the back—in the past, and I was one that 

voted against the stimulus, but to tell you the truth, when the 

President first started outlining the stimulus, and it seemed as 

though it was principally focused on both on tax cuts and infrastructure investment, I was very supportive of it. And I think that 

we have had a vivid demonstration, particularly with the unemployment numbers, of a mistake that the Congress made with the 

stimulus of not putting more money into infrastructure investment. 

And I feel very strongly that that would have resulted in a different outcome, a better outcome for the country economically if we 

had invested in infrastructure, and I still feel very strongly about 

that. 

Let me ask you, if I could. One of the biggest issues that is happening in Michigan—not only Michigan, but Canada has made it 

15 

their top priority as well—is an additional span of the—of a bridge 

over the Detroit River. And currently, as you know, there is a private bridge that has been there for about 80 years, and the owner 

wants to twin that span, and he is willing to do that with his own 

dollars. And the debate is the DRIC, as we all refer to it, the Detroit River International Crossing, which would be about a mile 

south of the existing Ambassador Bridge, which is the first busiest 

border crossing on the northern tier. 

Without getting too much into the whole DRIC debate, which is 

an enormous debate, as you know, Canada, the first time in my 

lifetime I can even recall, they have actually offered to pay—not to 

pay, but to loan, they want to get the money paid back—to loan 

the State of Michigan $550 million to pay for their match share to 

the Feds for this, so they obviously have made it an enormous priority. 

In full transparency, I represent the Blue Water Bridge, which 

is about 30 minutes, maybe an hour, north of that, which is the 

second busiest border crossing, and that is the focus of my question. I will leave the DRIC alone for a moment. 

The Blue Water Bridge, the second busiest border crossing on the 

northern tier, the Canadians have done a remarkable job of expanding their plaza on the Canadian side. We have not done that 

on the American side. That has had its own controversy. Some of 

it has been our own fault in the States because of different reasons. 

But now all the controversies are settled, we are ready to proceed, 

and it would just seem to me that this would be an excellent way 

to expand and expedite commerce between the two nations. It 

would be a wonderful expenditure of infrastructure investment 

long term. 

It is an international border crossing, a huge border crossing. 

And I think the DRIC—this is a million opinions—my opinion is I 

don’t think the DRIC, in all the controversy surrounding that, is 

going anywhere—will be resolved any time in the near future. And 

in the interim here where are with the Blue Water Bridge. 

I will mention, and I want to thank you for the $30 million in 

the TIGER grant that was given not to the Blue Water Bridge, but 

to a border cross—excuse me, a river crossing, the Black River 

crossing, right in that immediate area, which is a component of the 

plaza expansion, and we are very appreciative of that. 

But what are your thoughts on the possibility of some additional 

assistance through your Department on assisting with the expansion of the plaza there at the Blue Water Bridge? 

Secretary LAHOOD. Well, what I should do is really have our people go up and meet with—and if you want to help organize it, it 

is fine. We will meet with the folks from Michigan and also from 

Canada and see how we can be helpful. I mean, we do have another round of TIGER, which applications are due in mid-August 

or late August, and so I think it would be worthwhile having a discussion. I take what you say that everybody is in agreement. 

When people have their act together, good things will happen. 

Mrs. MILLER OF MICHIGAN. We are shovel-ready. Shovel-ready. 

We just need the cash. 

16 

Secretary LAHOOD. If people have their act together— which I 

have no doubt if you say it, it is so—so we should go up and meet 

with them and try to find a path forward. 

Mrs. MILLER OF MICHIGAN. You can believe that I am going to 

take you up on your offer, Mr. Secretary. 

Secretary LAHOOD. We will do it. 

Mrs. MILLER OF MICHIGAN. Let me ask you one other question, 

if I could. One of the other things that you and I have worked on, 

Mr. Schauer as well, Mr. Ehlers, Members from Michigan, is of 

course the match for Federal dollars. And in Michigan, it is no surprise to anybody. I wish our unemployment was at 10 percent the 

national average. Our unemployment has just taken a dip. We are 

down in the high 14 percentile right now. Some of my counties are 

around 20 percent. So we are on our knees economically. And why 

I am not whining about that, we are doing everything we can to 

find our way back. 

At the same time, here we are with about three-quarters of a billion dollars of Federal money that we cannot advantage ourselves 

of because we are not going to be able to afford the 20 percent 

match. And yet this is Federal fuel taxes that our residents have 

already paid for. And it is not like it is going to just disappear 

somewhere; it will go to another State. 

Is there anything else? And I know we have talked about this, 

but do you have any comment today on how Michigan may be able 

to get a temporary waiver from that match or flesh out a bit how 

we can access that and advantage ourselves with those dollars? 

Secretary LAHOOD. To my knowledge, whenever I have talked to 

your Governor and others, I don’t know that there has ever been 

a request for a waiver. As you know, the economic recovery, the 

transportation requires no match; and so I don’t know, maybe that 

is an area where we can look at for some of these projects, that 

they would qualify for the economic recovery portion, which there 

is no match required. So we will be happy to work with you on 

that. 

Mrs. MILLER OF MICHIGAN. I appreciate it very much. And I will 

take you up on your offer to have someone come and take a look 

at the Blue Water Bridge. The Chairman and I actually sit on 

something called the U.S.-Canadian Interparliamentary Group. We 

met about a month ago with our Canadian counterparts, and this 

was a huge issue about the DRIC. And at the end of it, basically 

what we were saying, we need to be focusing on the Blue Water 

Bridge in the immediacy. So I think you will find a lot of support 

on both sides, both Nations, for that. 

Secretary LAHOOD. We will do it. Thank you. 

Mrs. NAPOLITANO. Mr. LaHood, I just want to say to my colleague, Ranking Member Ms. Miller, that I have found great support from your staff. And I just want to mention that. Thank you 

for allowing your good Assistant Secretary, Joel Szabat, to go and 

talk to my groups of COGs and MTA and all those. Fantastic job. 

And you are to be commended, sir. 

Secretary LAHOOD. Thank you. 

Mrs. NAPOLITANO. [Presiding.] Mr. Altmire. 

Mr. ALTMIRE. Thank you, Madam Chair. 

17 

Mr. Secretary, as you certainly are aware, we in Pennsylvania 

had an application for tolling of I-80 which was denied, and which 

I won’t ask you about. But the issue is, now there is a $472 million 

funding gap at the State level because they had counted on that 

money. And one of the decisions that was made yesterday is the 

Governor had recommended diverting some existing highway 

money to public transit, and in southwestern Pennsylvania the decision making entity had a vote and they voted against allowing 

that to happen. 

I just wanted to ask your opinion of, in a State like Pennsylvania, where there are so many critical needs with roads and 

bridges—and now the transit authority have multimillion-dollar 

deficits as far as the eye can see, nonbinding—but just your opinion, since you are here, what would you suggest the State do or 

what do you think about the dilemma we are seeing in Pennsylvania? 

Secretary LAHOOD. Look, Pennsylvania is not unique. Every 

State, as Mrs. Miller said, from Michigan, you know, every State 

is cash strapped and every State is trying to find revenue to either 

match the money or to provide the money for projects. And our people in the States with the Federal Highway Administration or FAA 

or others are willing to sit down and work with Governors and 

DOTs to try and find a path forward. 

These are not easy answers. You all passed a bill that allowed 

transit districts to use up to 10 percent of their money for operating, and that has been helpful. But the dilemma continues because ridership is down and costs continue to go up, and so we 

know that there are States that are really trying to figure out what 

to do. 

We have worked a lot with the State of Pennsylvania on their 

transportation issues, particularly with Governor Rendell and his 

team; and, obviously, we would be willing to sit down and figure 

out what we can do. 

Mr. ALTMIRE. Thank you. 

On a more national perspective, we have discussed today in the 

Committee, and you have mentioned your testimony and have in 

dozens of other places, the need for funding in the highway bill. 

And my question is—we are all having that discussion within our 

districts, ways to generate the revenues to fund the needed roads 

and bridges repair—what is the result of the delay that has occurred because of this ongoing discussion and inability to finalize 

that plan? 

Secretary LAHOOD. Well, we are operating on a continuing program, the program that was passed 2 years ago. And we at the Department think, as I think Mr. DeFazio laid out very well, that 

there are a lot of unmet needs in America. And as we have looked 

at Chairman Oberstar’s bill and the way he tries to address those 

unmet needs, we agree with many of the things that are in his bill. 

So what we are doing is operating on the current program, or 

program that was passed 2 years ago, that has been extended 

through the end of this calendar year, and created innovative 

thinking to meet infrastructure needs I think have been included 

in many of the aspects of the Chairman’s bill, and we agree with 

18 

many of those. It is a matter of trying to find the resources to do 

them. 

Mr. ALTMIRE. One of the things I continue to hear, as you know, 

I represent southwestern Pennsylvania where we have a thousand 

structurally deficient bridges, crumbling infrastructure. And with 

the stimulus bill, there was a lot of work that was done, it was 

very visible, and there seems to be this idea that that is now a disincentive to go forward with the huge highway bill because there 

are some casual observers who say, well, the stimulus came in and 

they funded all these transportation projects, so therefore it is less 

of a priority now to move forward with a multiyear highway bill. 

How do you respond to that? . 

Secretary LAHOOD. Well, what I have said to people when people 

have said, what is the follow-on to the stimulus bill, it certainly is 

a comprehensive transportation program passed by Congress. I 

think that is the natural follow-on that will keep these people 

working and keep the momentum going and fixing up infrastructure. 

Mr. ALTMIRE. Thank you, Mr. Secretary. 

Mrs. NAPOLITANO. Thank you, Mr. Secretary. And I think I will 

step in for a moment on this one, because one of the things that 

I have great concern in California, of course, is the high-speed rail, 

and I would like to be able to discuss that with you at great length 

at some time. 

In deference, because I know you have to leave, and to give other 

Members time, there are only a couple of things I would like to 

bring up and I will follow up on the other one with you. 

Specifically, the Colton Crossing BNSF received a 30 million 

TIGER grant; this is a subsidy for a very profitable industry that 

benefits only the railroads. Yet when we are trying to get the railroads to fork over a minimal amount to be able to work on other 

projects, they refuse. 

So I would like to be able to sit and figure out, how do we get 

the railroads to be aware that if they are getting Federal taxpayer 

money to do the railroad, the Colton Crossing, it is the Colton 

Great Separation, then they need to be able to make adjustments 

in their budget to be able to help the locals in other areas. And, 

again, I will cover that with you. 

But the Department has been focusing on creating a high-speed 

rail manufacturing sector in this country so that the engine and 

cars for the proposed high-speed rail system will be made in America. We currently spend $3 billion on transit cars that are overwhelmingly made in foreign countries. 

What are you doing? What can we do to help promote manufacturing in the U.S. to create the jobs that we so desperately need? 

Secretary LAHOOD. Well, there is a very strong Buy America provision in the Recovery Act. We have not granted any waivers. We 

have put the $8 billion out to 13 regions around the country for 

high-speed rail. We don’t intend to grant waivers. We hope that 

companies from Europe, whether it be France or Spain or Italy or 

Germany, or even the Far East, China, Japan, will come to America, hire American workers and use American facilities. 

I have traveled to all of those regions in the world. I have ridden 

high-speed rail in France and Germany and Spain and Italy and 

19 

China and Japan. What I have told every one of those train manufacturers, Come to America, hire American workers and build the 

train sets in America using American facilities. And there are 

many of them that are here in America doing that. 

Like Congress, we believe in the ‘‘buy or build,’’ as my friend 

from California has in his bill, Made in America, Build in America, 

or Buy in America; however you want to say it, we are with you 

on that. 

Mrs. NAPOLITANO. Well, I certainly want to be sure that we continue to develop these opportunities for our manufacturing base to 

grow back in America. So whatever we can do, whatever is there. 

I would move on to our next person, Mr. Platts. 

Mr. PLATTS. Thank you, Madam Chair. Mr. Secretary, always a 

pleasure. Good to see you. 

Secretary LAHOOD. Good morning. 

Mr. PLATTS. I apologize if I am going to be repetitive with coming 

in here and running out. I know you appreciate the juggling of our 

schedules. 

Secretary LAHOOD. I do. 

Mr. PLATTS. A question that I certainly get back home, and I 

know it is on our side in the reauthorization, but also from the administration’s side, how you best see where we are; and if we don’t 

get reauthorization done this session, and the plan of that 18 

months, whether that be in the next session, where we are going 

to be from an outlay standpoint? 

My concern is I have construction companies that do highway, 

bridges. They are saying if it is not done by the end of this year 

or very early next year, there are going to be dramatic layoffs, because the numbers in the current just won’t allow them to keep 

people on the payrolls because they are not going to have the work. 

Can you give your best assessment of where we are? 

Secretary LAHOOD. What I have said and continue to say is we 

will work with Congress, we will work with this Committee, those 

Senators on the committees of jurisdiction in the Senate. There is 

no dispute about what the needs are in America. We all know what 

they are. It is really just trying to find the billions of dollars that 

it takes to do it, and we just need to work together to find those 

resources. If we find the resources, I have no doubt you all could 

pass a bill tomorrow or pretty quickly. 

Mr. PLATTS. Does the administration have a number that they 

would like to see in reauthorization, what they think best-case scenario, assuming we have the resources? 

Secretary LAHOOD. Well, I have been running around the country applauding Chairman Oberstar for his bill. We like his bill. We 

think many of the things in his bill are very good. They really 

begin to address the infrastructure needs and other needs, transportation needs in the country. And so we have had a little discussion here earlier about what the cost of that is; and if we can agree 

on what the cost is and how to get there, obviously we are on our 

way to a transportation program. 

Mr. PLATTS. I know that you are as anxious as we are to get that 

done and have the dollars flowing and infrastructure improvement. 

And certainly an area where I think we will find ultimately some 

20 

really strong bipartisan agreement is the importance of this investment, sir. 

I appreciate your leadership at the Department. Always good to 

see you. 

Secretary LAHOOD. Thank you. 

Mr. PLATTS. I yield back, Madam Chair. 

Mrs. NAPOLITANO. Thank you, sir. Mr. Kagen. 

Mr. KAGEN. Thank you, Madam Chairwoman. I appreciate the 

opportunity. 

Thank you, Mr. Secretary, for being here. Perhaps you could very 

briefly highlight the contrast of who the American people should 

believe. Some people have stood on the House floor to say that the 

stimulus bill, the American Recovery and Reinvestment Act, hasn’t 

produced a single job at all; and you are here, telling us it produced 

thousands. So convince me and the American people who is correct 

and who is being truthful on this. 

Secretary LAHOOD. Well, all you have to do, Congressman, is 

walk a few steps in my shoes. I have been to 80 cities and 30 

States in the last 18 months, and everywhere I go I see orange 

cones and orange barrels. Everywhere I go I see people working. 

These are people that would not be working if it hadn’t been for 

the courageous votes of those who voted to pass the economic recovery plan. Forty-eight billion dollars, almost all of it is out the door 

in the States. Almost all of the airport money has been spent. A 

lot of the highway money is being spent. Thousands of jobs are now 

in existence, building, resurfacing roads and bridges in America 

today. 

So my point is get out around the country, and what you will see 

is America’s infrastructure being rebuilt. We took $8 billion and 

gave it to transit districts to buy clean burning buses. Those buses 

were made in America in places like Minnesota, New Flyer, and 

other companies; a company in California, very fine company in 

California. 

Some transit companies use the money to build facilities which put building tradespeople to work. We have given $8 billion to 13 

regions in the country for high-speed rail. That is 8 billion times 

more than America has ever invested in high-speed rail. 

High-speed rail is coming to America, and soon we will have contracts signed with the States, and people will be going to work 

building infrastructure for high-speed rail, building train sets. 

And this program has put thousands of people to work in thousands of projects all over America. I have personally seen it, and 

I know that you have all seen it in your districts traveling around 

like you do. 

Mr. KAGEN. Well, we will hear later this morning from someone 

from my district who has put people to work because of the stimulus bill and it helps to retain jobs. 

You mentioned that it was a courageous vote to put people back 

to work and to keep people working. But it might take another 

steel spine, it might take another courageous vote to find the funding to make sure that we can fully fund the rebuilding and reinvestment in America’s infrastructure and transportation. So how 

specifically would you find the money to pay for a $500 billion 6- 

year Rebuilding of America Plan in transportation infrastructure? 

21 

Secretary LAHOOD. Well, look, it has to be a combination of 

many different funding opportunities. 

Mr. KAGEN. Well, you heard the Chairman. He is in favor of a 

gasoline tax. How does the administration feel about that? 

Secretary LAHOOD. The administration is opposed to raising the 

gas tax when we have unemployment hovering around 10 percent 

and people are out of work. But we think there is a gas tax in existence; we should use those resources and couple those with other 

opportunities. We suggested an infrastructure fund. We suggested 

public-private partnership. We suggested tolling. I have been to 

places in the country where they put hot lanes in. Build them with 

tolls. You can raise a lot of money with tolling and people see the 

value of those. So I think we need to think outside of the box about 

where we find the resources. 

Mr. KAGEN. So you are in favor of a user fee, that those who are 

using that particular benefit, that transportation modality should 

be the ones to pay for it. 

Secretary LAHOOD. When I have been around the country, I have 

seen the value of tolling in building infrastructure. And people are 

using—whether it is a road or a bridge or a highway, you can raise 

significant dollars, and people have the discretion whether to use 

it or not. 

Mr. KAGEN. And how do you feel about the creation of an infrastructure bank, where we put together the resources so we don’t 

have to go to Wall Street to borrow the money but we put our own 

resources together to finance our Nation’s infrastructure? 

Secretary LAHOOD. We favor an infrastructure fund. We put it 

in our budget, we have asked for it in our budget, and we will continue to do that. We think it is a good way to build significant big 

projects around the country. 

Mr. KAGEN. Thank you very much. I yield back my time. 

Mrs. NAPOLITANO. Thank you, sir. Mr. Teague. 

Mr. TEAGUE. Thank you, Madam Chairwoman, for letting me 

speak. 

Secretary LaHood, thank you for appearing before this Committee and thank you for your tireless work on behalf of American 

workers and the American transportation system. 

As part of your implementation of the American Recovery and 

Reinvestment Act, I am not sure I can think of a better team between you and Chairman Oberstar for this legislation implementation and oversight of the Recovery Act. 

In Dona Ana County, which is the largest county of my district population-wise, we are spending $36.2 million to add a lane for 17 

miles of I-10, and it is creating hundreds of jobs and laying the 

groundwork for our future economic expansion there. And we also 

have the pleasure of having Chairman Oberstar to come out for the 

groundbreaking of that. 

But you know, in almost every little town in my district, folks— 

we are spending money and getting overlay on Main Street or 

rehab a bridge or widening the shoulders or something. I was going 

through the mountains coming across Emory Pass, which is about 

10,000 feet high in the helos, and there it is, you know, the American Recovery and Reinvestment Act at work repairing the shoulders on those dangerous roads up there. I mean, the roadis a good 

22 

road, the site is a beautiful site. But as you go up those steep 

switchbacks, you need to be paying attention. The roads need to be 

in good shape. And they are because of the Recovery Act. 

I think the Recovery Act has brought us back from the brink of 

economic catastrophe. And if you go to my district, you can see the 

hard work that is happening everywhere. 

But speaking of my district, I would like to invite you there on 

September 8. I am having what we call a Dona Ana County transportation summit. We are going to discuss the success of the Recovery Act projects and how they relate to our future plans for transit 

and new interchanges, intermodal freight carrier centers, and the 

challenges of moving goods and people across the international 

boundary. 

And I really would love to host you in New Mexico, and I have 

an invitation here that I will get to you before this meeting is over. 

But I just wanted to follow up on the question that Congressman 

Kagen was asking. 

So I think the way I understood you to say, if people would get 

out and go across their district and see, they would see jobs that 

are being created by the American Recovery and Reinvestment Act. 

And those people that say that the Recovery Act has completely 

failed to create jobs are just overlooking a lot of jobs in their district, or haven’t been out. 

Secretary LAHOOD. There are many thousands of jobs that have 

been created over the last 18 months. They exist today. America is 

being rebuilt as we speak, and we have the statistics to show that 

thousands of people are working today on thousands of projects. 

Mr. TEAGUE. You know, I thank you for saying that, because that 

is what I see in my district. I look forward to hosting you in my 

district, and thank you for your service. . 

Secretary LAHOOD. Thank you. 

Mrs. NAPOLITANO. Mr. Garamendi. 

Mr. GARAMENDI. A comment. Some of those people that are saying there are no jobs are quite happy to appear in various photos 

with great big checks saying that the jobs are being created. So 

maybe there is a little inconsistency. 

Mr. Secretary, thank you so very much for the work that you are 

doing. You and your Department are getting the money out. It is 

excellent, and you are doing very, very well at it. Earlier in your 

comments you alluded to a program that you are working on, 

which is Make It in America, Build It in America, Make It in 

America. Manufacturing matters. 

You and I have had a discussion about the waivers, the way in 

which they have been used in the past. And you said here that you 

are not interested in providing waivers and that you are going to 

be very hard on that. I think that is the right policy. I encourage 

you to continue to do that. 

And for my colleagues here, I would ask them to consider supporting a piece of legislation that I have introduced that would remove three of the four waivers that you presently have available 

to you, leaving only a cost waiver in place. We must make it in 

America. There will be a witness here from the San Francisco Bay 

Area, Gillig, a little longer. 

23 

So my question is a very quick one to you. You have already answered it. And that is: What is your policy with regard to waivers 

on manufacturing rolling stock and others outside of the United 

States? 

Secretary LAHOOD. I mean, we, as you know, some people have 

asked us for a waiver and we have denied that. We believe that 

Made in America, Build in America, Buy in America has to be a 

very strong policy and will be a very strong policy under this administration. 

Mr. GARAMENDI. Thank you very much. And I commend my piece 

of legislation to my colleagues that would say, yes, it will be built 

in America. If it is American taxpayer money, it is going to be used 

in America, not in some foreign country. 

So thank you very much, Mr. Secretary. 

Secretary LAHOOD. Thank you. 

Mrs. NAPOLITANO. Mr. Capuano. 

Mr. CAPUANO. Thank you, Madam Chair. 

Mr. Secretary, welcome back. It is always great to see you. And 

I will tell you, I have been doing a little bit of time in the Chair, 

and I will tell you that you have been my role model, the perfect 

person to oversee the House. 

Secretary LAHOOD. Thank you. 

Mr. CAPUANO. I will tell you that I think the U.S. Secretariat 

and you have done a fantastic job with this bill with the limited 

resources we gave you, if you want the truth. I was one of the ones 

who thought we should have done more on transportation. And we 

did what we could, and I think that this country would have been 

better off if we would have given you more tools to work with. But 

nonetheless, with what we gave you I think you have done great. 

I do have one bone to pick and one policy question to ask. 

The bone to pick: Everywhere we go, we talk about the signs that 

say ARRA. It took me about 6 months to figure out what it was; 

I thought it was a baseball term. I wasn’t quite sure. I really wish, 

I beg you, to put out an executive order to require all those signs 

to say ARRA, whatever you want on it, but put the words ‘‘the 

stimulus’’ on the sign. Nobody knows what ARRA is except for 

those of us who live in the Beltway. 

The average American, as has been referred to here repeatedly, 

are talking about the stimulus. It is the one and the same. And if 

those signs don’t say it, the American people don’t get the connection. They think it is something else altogether. So I am begging 

you to put the word ‘‘stimulus’’ somewhere in big bold letters on 

those signs. 

Secretary LAHOOD. We don’t make the signs. We don’t manufacture signs at DOT. The signs are a voluntary provision if States 

want to put them out. Half the States have used signs and half the 

States have not used signs. In the States that have used signs, 

they have used small businesses in their States that hire workers 

to make signs. 

Mr. CAPUANO. I have no problem with it. But I would also say 

if it is Federal money paying for those signs, we have the authority 

to require them to put the word ‘‘stimulus’’ on it. 

Secretary LAHOOD. I take your point. 

24 

Mr. CAPUANO. And the last item, again, it is not really a bone 

to pick. It is really a policy question. I have always respected the 

policy difference amongst Members of Congress and in this country. 

I think the democratic process is beautiful. We debate, we disagree, 

we agree, and we work it out. And I respect that. 

I find some of the people, I tell this to people all the time at 

home. They always ask me about partisanship and why can’t we 

just get along. And my answer is always: Most of us do, even when 

we have strong disagreements. Some of the people I like and respect the most here in Washington are people I disagree with on 

a regular basis, because they have good, solid, philosophical views 

I respect. 

And the same thing goes for the stimulus. I have no problem 

whatsoever, not one, with anybody who voted against the stimulus, 

because it was a leap of faith. I took the leap of faith because I 

thought it was necessary for the economy. I think it has worked 

out better—I mean, it is not perfect—but it worked out better than 

not doing it. 

I would like to know, Are there any policy considerations, any 

formal or informal policy considerations, given to when you have 

various projects—many of which qualify—to giving a little extra 

weight to those projects that are in the districts of Members who 

supported the stimulus? 

Secretary LAHOOD. Absolutely not. 

Mr. CAPUANO. I respect that, Mr. Secretary. But I would respectfully, strongly, and vehemently disagree. I respect those people who 

voted against it, but I will tell you they are the largest, most vocal 

hypocrites in Washington, and maybe in public office. It is like earmarks. I don’t mind anybody who doesn’t take them. I respect that. 

I think that is a good philosophical view. I disagree, but that is OK. 

And those who voted against the stimulus, fine. But those who 

voted against it and then come to you and beg you for money— 

which I have heard on this panel today—are hypocrites of the 

worst degree. And I think they are doing a disservice to the American public and I think the American public they—if they truly represent their constituents, they didn’t want the money, and I respect 

that. And out of respect for them, I think we should deny them the 

money that they so hypocritically asked for. And if we can’t deny 

them the money, at least can you deny them the photo op? Could 

you at least put out some sort of an executive order to say anybody 

who voted against it is no longer welcome to a photo op on ribbon 

cuttings of bridges and roads that have been fixed with the stimulus money? I would hope that you would be able to do that. 

Secretary LAHOOD. I have a very difficult time operating the 

camera. I don’t take photos at these events, Mr. Capuano. 

Mr. CAPUANO. You are entitled to take a photo in my district any 

time you want, Mr. Secretary. 

Secretary LAHOOD. Thank you. 

Mr. CAPUANO. Happily so. 

Mr. Secretary, I only have 35 seconds and I would like to bash 

the hypocrites in Washington a little bit more, but I guess I have 

done my job and I yield back the remainder of my time. 

Mrs. NAPOLITANO. Thank you, Mr. Capuano. I can tell you, you 

are something else; and I agree with you. 

25 

Mrs. Miller has one more question. 

Mrs. MILLER OF MICHIGAN. Thank you very much, Madam Chairman. 

You know, just following up on my colleague’s comments about 

people with the stimulus. Actually, there was an interesting poll in 

the New York Times, which I think is not the most conservative 

of all newspapers, that showed only 6 percent of the American people believed the stimulus worked. I heard somebody refer to—say 

that more people think Elvis is alive than think the economic stimulus actually works. So I am not sure that the overwhelming majority of the Americans are hypocrites. I do not believe that. 

And I would also just make one comment about the signs. It is my understanding that we have spent already over $100 million on 

signs saying ARRA. And my opinion, a million opinions, I don’t 

think it is a good expenditure of tax dollars. I would rather spend 

$100 million on roadwork, actually, in our State of Michigan. Our 

Governor started out putting her name on the signs. There was 

such a huge outcry, as you might imagine, that she quickly took 

her name off of those signs. 

But my question, Mr. Secretary, is let me go back to the DRIC 

just for a moment, being a bit parochial, since it is the overwhelming issue of transportation in my district. And you mentioned about P-3s, and how as we on the road forward, fund the 

highway transportation, whether that has—there are a number of 

things of how that might happen—tolls, P-3s. I think P-3s have an 

enormous opportunity for our country. So many places, particularly 

in Europe, have utilized them very, very effectively. 

And I guess I would ask you two things, perhaps. Maybe you 

could give us a good example of a P-3 in the country now that you 

think is something we might look at. 

And in regards to the DRIC, because the Ambassador Bridge is 

currently a privately owned bridge—and, again, the owner of that 

bridge wants to spend his own dollars to twin this bridge. And although I haven’t taken a position on whether we should allow that 

to happen, or whether the DRIC, which will be financed by both 

Federal money and Canadian money, taxpayers’ dollars, which of 

that is better. But it does appear as though the DRIC may not actually be able to proceed because there is not much movement in 

the State Senate in Michigan. 

I am not sure how all of that will work. But if the State of Michigan does not approve the DRIC, what would be the position of your 

Department regarding the twinning of the Ambassador Bridge, 

which is a P-3? 

Secretary LAHOOD. Well, what we have said is that we are going 

to work with people in Michigan and Canada. I think it is probably 

not a good idea for people in Washington, D.C. deciding the siting 

of a bridge and whether it should be privately owned. I mean, those 

are decisions that need to be made by people in Michigan and people in Canada. And if we could be helpful in getting those people 

to the table and talking about it, that is fine. But we need to let 

folks that are elected by the people in the country of Canada and 

the State of Michigan make those decisions. 

Mrs. MILLER OF MICHIGAN. I appreciate that, because there has 

been a tremendous amount of coverage, and people have said that 

26 

the Department of Transportation, the Federal Government generally, is very supportive of the DRIC. So you are saying you are 

not taking a position until such time as the State of Michigan 

makes their position known? 

Secretary LAHOOD. I have talked to the Governor a lot about the 

DRIC, and we are waiting for the Michigan legislature to make a 

decision. 

Mrs. MILLER OF MICHIGAN. Thank you. I appreciate that. Thanks 

very much, Madam Chair. 

Mrs. NAPOLITANO. You are very welcome. 

And I just have some information. The cost of the signs is significantly less than the Recovery Act critics tried to claim. It is less 

than 2 cents for every $100 they are investing in the ARRA funds. 

And the best estimate is that the States have spent about $5 million on these signs. So I just want to, for the record, show that is 

what we have. 

Secretary LAHOOD. Well, let me just say that these signs don’t 

just mysteriously appear. These signs are made by small businesses in States that employ people. And that is part of where 

the—the money is going to small businesses. 

Now, I think everybody in this room knows I am a Republican. 

When I was a Republican serving in the House, you know, there 

were a lot of Republicans supporting small business. I don’t know 

a better way to support small business than to buy things from 

them like signs. That is one good way to help small businesses in 

your States. This money is going to help employ people who are 

making signs. 

Mrs. NAPOLITANO. That is one area that I know well. I was in 

a parade on July 4, and one of the people in the area said, ‘‘Thanks 

so much for the ARRA for repaving our streets,’’ because they were 

repaved with ARRA funds. 

So, Mr. Secretary, it has been a pleasure. Thank you so much for 

being with us today, and we will now excuse you. This Subcommittee, this hearing is going to go into the next panel, and look 

forward to talking to you, sir. 

Secretary LAHOOD. Thank you. 

Mr. KAGEN. [Presiding.] Gentlemen, welcome to the Transportation Subcommittee. We will now hear testimony from Mr. Bill 

Schneider, Brian Macleod, Steve Millsap, Jim Duit and Kevin Gannon. Let’s begin on the far left with Mr. Bill Schneider. Welcome 

to the Committee. Thank you for appearing. 

TESTIMONY OF BILL SCHNEIDER, PRESIDENT/CEO OF KNIFE 

RIVER CORPORATION, ON BEHALF OF THE NATIONAL 

STONE, SAND AND GRAVEL ASSOCIATION; BRIAN MACLEOD, 

SENIOR VICE PRESIDENT, GILLIG, LLC, HAYWARD, CA; 

STEVE MILLSAP, ASSISTANT VICE PRESIDENT, STRUCTURES, BNSF RAILWAY COMPANY; JAMES A. DUIT, PRESIDENT, DUIT CONSTRUCTION COMPANY, INC, EDMOND, OK; 

AND KEVIN GANNON 

Mr. SCHNEIDER. Good morning, Chairman Kagen, ladies and gentlemen of the Committee. My name is Bill Schneider, and I am the 

President and CEO of Knife River Corporation, the Nation’s ninth 

largest aggregate producer. I am also here in the role of chairman 

27 

of the board of National Stone, Sand & Gravel Association. Thank 

you for this opportunity to speak with you today. 

When the construction industry began a steep decline in 2008, 

many of us thought it would be a temporary downturn, but today 

the decline continues. We are still unable to see light at the end 

of the tunnel. At our company, Knife River, we have over 2,000 

fewer employees today versus the market peak of 2007. 

Last year, we received, thanks to all of you on this Committee, 

a much needed boost of public works through the project-sponsored 

American Reinvestment and Recovery Act. I have heard dozens of 

stories from our Members about how this stimulus money helped 

keep their people employed while reconstructing thousands of miles 

of our Nation’s highways. It has been our safety net, and soon it 

will be gone. 

Since ARRA’s passage, Knife River has been awarded nearly $200 million in stimulus projects throughout our 17-State operation. Our current backlog of work to be built is nearly 20 percent 

stimulus funded. Earlier this year, your Committee heard from one 

of our drivers, Joyce Fisk from Minnesota, whose job was saved due 

to this funding. 

We all understood this bill was a one-time bankroll. Now we are 

headed back to square one and wondering what our future holds. 

Chairman Oberstar’s proposed $450 billion 6-year funding plan 

would put over 1 million Americans back on the job doing real 

work in an extremely competitive environment, a great value for 

the taxpayer. 

Construction workers are on the unemployment lines at over 

double the rate of other American workers. The unemployment rate 

this past winter peaked at 27 percent—and, by the way, we think 

that is understated—and now sits at 20 percent only because we 

are in full swing in the construction season. If a 6-year bill is not 

passed before the stimulus funds are completed, construction unemployment in this country is going to go off the charts. 

More effective than these statistics are real-life stories of what 

is happening across the country. As an unbelievable example of 

road conditions and correlated lack of funding, Stutsman County in 

my home State of North Dakota, started turning back 50 miles of 

paved road back into gravel surface this summer because it can no 

longer afford to maintain the existing asphalt surfaces. This is 

equivalent to turning back the clock 75 years. We are going backwards, not forwards, in investing in our country’s infrastructure. 

In 2008, a poll conducted by Fabrizio McLaughlin & Associates 

reported that 72 percent of Americans believe that the Federal 

Government should lead the funding of major highways and 

bridges. In addition, 14 out of 15 Americans believe it is important 

for Federal elected officials to support the position that fuel taxes 

and other highway fees be dedicated only for highways and bridge 

improvements. Further findings discovered that nearly three-quarters of Americans support increased investments in infrastructure. 

And, finally, 57 percent would support an increase in gasoline user 

fees if the funds were dedicated only for transportation. 

As NSSGA Chairman, I represent hundreds of members and 

thousands of workers, plus millions of Americans, when I say that 

Congress needs to pass a long-term highway funding legislation 

28 

now. We have had too many SAFETEA–LU extensions. State DOTs 

will soon start shelving projects without the certainty of a 6-year 

bill. Certainty is the key. This is something we cannot continue to 

put on the back burner. 

Now, we realize the big question, as we have heard earlier, is 

where will the money come from? As you all know, we have the 

system in place, the Federal Highway Trust Fund, that the Chairman talked about. It needs to be restored to the strength it once 

had, and more money is needed to keep up with the growing demands. 

While it is politically difficult to consider raising the Federal gas 

tax, many of us believe it is really our only answer to fund highway 

projects that are in serious need. As noted in the previous research, 

American taxpayers would support it if it meant safe and efficient 

highways. 

We are very grateful for Chairman Oberstar’s bold leadership in 

passing our legislation and monitoring its effectiveness. The industry thanks him and those on the Committee that supported him. 

Now, though, we must come together to build support for a longterm highway user’s bill to make transportation a priority in Congress and the White House. Passing this bill means you are essentially passing a jobs bill and putting thousands of Americans back 

to work not only in the construction industry but in many other 

businesses that support our work. 

Finally, let’s get real. Now more than ever, there is a need for 

real jobs, meeting real needs, and providing the American taxpayers real value. Thank you. 

Mr. KAGEN. Thank you very much for your testimony. 

Mr. Macleod. 

Mr. MCLEOD. Good morning, Mr. Chairman, Congressman 

Garamendi, and staffers. My name is Brian Macleod, and I am 

here representing the employees and owners of Gillig, LLC, transit 

bus builders. 

Gillig is a 120-year-old American company that started in San 

Francisco as a builder of horse-drawn buggies and carriages. We 

are still in the San Francisco Bay Area and still in the transportation business, except now we build modern heavy-duty hybrid 

electric and fuel-efficient transit buses that are the most reliable 

and most economical buses in the United States. 

Gillig is the second largest bus manufacturer in North America 

and the last surviving transit bus company. We have a unionized 

workforce and about 700 direct employees. And they produce about 

1,600 buses per year that are operated by transit systems across 

our great country from Alaska to Florida and Massachusetts to Hawaii. 

The current economic downturn caused many companies to lose 

money, cut back production, and lay off workers. However, things 

are different at Gillig. Our customers are transit agencies who normally buy buses with a combination of Federal and local money, 

but the economic slowdown has caused their local budgets to be 

cut. So early last year our customers began telling us they would 

have to reduce their bus orders due to insufficient funding. This of 

course concerned us greatly, because that would mean we would 

29 

have to cut production and lay off some of our hard working employees. 

However, the Recovery Act came to our rescue. It included 100 

percent Federal funding for buses, without the need for a local 

match. But our story gets better. 

Some customers were also able to buy one or two extra buses, so 

we actually booked more buses than anticipated and, accordingly, 

we were able to increase production slightly and actually hire additional full-time employees. 

In the last 15 months or so, we received bus orders from over 160 

different customers, for a total of over 1,000 buses. The orders 

came from transit agencies all over the country. Some of the cities 

receiving ARRA-funded buses from us are San Jose, Buffalo, Minneapolis, Dayton, Memphis, Kansas City, Omaha, Salt Lake City, 

and Orlando. As a result, we have increased our full-time employment by 40 people instead of laying off about 170, which is probably what we would have been forced to do without the Recovery 

Act funds. So we actually saved about 170 jobs and added another 

40. That is 210 Gillig families that are directly benefiting. 

And it gets even better. In our industry, the job multiplier is 

about five or six, which means that our 210 jobs saved another 

1,100 or so supplier jobs. And the benefits don’t end there, because 

transit investment produces multiple benefits. These new buses are 

more energy efficient, more comfortable, more economical, safer, 

and generate fewer emissions than the buses they replace. 

So on behalf of all our employees and their families as well as 

the families of our supplier companies, I thank the Committee, this 

Congress, and the administration for thoughtfully conceiving and 

then passing the transportation portion of the Recovery Act. 

Gillig has recycled all that funding back into the U.S. economy 

through U.S. workers and their families, no outsourcing and no 

offshoring. The Recovery Act has effectively secured our jobs for 

now, but the slow recovery is threatening our jobs late next year 

and in 2012. State and local budgets are continuing to be cut, so 

bus orders are dropping now that ARRA funding has been used up. 

This means we could have to cut production late next year. So 

please consider ways to redirect any unused Recovery Act moneys 

to transit. 

We have proven that we used the funds effectively and efficiently. These funds were spent in the U.S. and so were good for 

the U.S. economy, good for U.S. families, good for the general public, good for industry, and good for the environment. 

Thank you for an effective and very beneficial Recovery Act. 

Thank you for your time today. And please help our future with additional Recovery Act funding, if possible. And please also do what 

you can to get a new 6-year transportation bill passed, because investment in our infrastructure is one of the best ways for Congress 

to stimulate our economy, create good jobs, and generate other benefits for our people and our country, a true win-win-win. Thank 

you. 

Mr. KAGEN. Excellent. Thank you very much for your testimony. 

And I will give you an open invitation to come to any of my listening sessions in northeast Wisconsin. 

Mr. Millsap. 

30 

Mr. MILLSAP. Mr. Chairman, distinguished Members of the Committee, thank you for the opportunity to appear here today to discuss the Truman-Hobbs Act project which places the Burlington 

Bridge swing span over the Mississippi River. 

My name is Steve Millsap. I am the assistant vice president of 

structures with BNSF Railway. In this capacity, I have responsibility for BNSF’s tunnels, bridges, snow sheds, and other structural 

assets and facilities. BNSF employs close to 40,000 people and operates one of the largest freight rail systems in North America with 

approximately 32,000 route miles in 28 States and two Canadian 

provinces. 

BNSF railway has about 14,000 bridges on its network. There 

are approximately 250 major bridges similar to the Burlington 

Bridge in size. We project that we will spend more than $400 million in major bridge capital replacement over the next 10 years. 

The Burlington Railroad Bridge was originally built in 1868, and 

crosses the Mississippi River between Burlington, Iowa and Gulf 

Port, Illinois. The bridge’s swing span replacement project was ordered by the U.S. Coast Guard in 1991 to remove what they determined to be an unreasonable obstruction to the waterway operation 

on the Mississippi River. 

Based upon a 2003 report by the Coast Guard and the American 

Waterway Operators, the Burlington Bridge is the third most 

struck bridge in the Nation. In fact, on average, vessels make contact with this bridge an average of 10 times per month. 

The Federal Government, under the provisions of the TrumanHobbs Act, is responsible for funding the Coast Guard’s order to 

alter this bridge; however, despite the fact that the order to alter 

was issued in 1991, it was not until the passage of the American 

Recovery and Reinvestment Act in February of 2009 that the full 

amount of Federal funding became available to move the project 

forward. Until that point, only $26.7 million, or less than half of 

the required funds, had been made available over the course of numerous congressional appropriations cycles. The Recovery Act provided $36.4 million for the Burlington Bridge project out of the 

total of $142 million made available to the Coast Guard and Truman-Hobbs projects. 

The total cost of the swing span replacement required by the 

Coast Guard is currently estimated at $43.5 million, and the BNSF 

will contribute approximately $8.3 million; however, BNSF is also 

moving forward simultaneously with a significant private investment of another $72.2 million to replace the 719-year-old bridge 

spans on both sides of the new vertical lift span. 

The Truman-Hobbs part of the project is now about 40 percent 

complete. We expect a substantial completion of May of 2011. So 

we are expecting to finish this 24-month project in 19 months. 

The project has impacted the retention and creation of jobs within dozens of large and small companies who are associated with the 

span’s construction. Through reporting by our contractors and subcontractors, we know that this project so far insured the retention 

of 43.98 FTEs. Roughly 80 percent of the onsite project crew is 

local Iowa and Illinois residents. In addition, of course, local vendors and other downstream suppliers have been positively impacted by this project. 

31 

Replacing the existing swing span with a modern vertical lift 

span will double the navigational channel width through the bridge 

from an existing 147 feet to 300 feet. This will greatly improve 

navigation for the waterborne traffic through the bridge and reduce 

operational delays and risk to the railroad. 

The Burlington Bridge is a critically important infrastructure 

component along the freight and passenger rail corridor between 

Chicago and Denver and on to California, carrying an average of 

34 freight trains per day and 2 daily Amtrak California Zephyr 

inner-city passenger trains. 

In conclusion, BNSF Railway is pleased with the progress of the 

Burlington Bridge alteration project. We look forward to continuing 

our cooperative working relationship with the Coast Guard and to 

ensure that the intent of the Truman-Hobbs Act is met. 

BNSF has a positive history of partnering with the public sector 

in rail projects that provide improvement in safety, energy use, reduced congestion, and fewer emissions, in addition to the freight 

benefits that we and our customers pay for and realize. We believe 

that this is a good model which was recognized in the Recovery Act 

and is being demonstrated in this public-private partnership on 

Burlington Bridge. 

Mr. Chairman, thank you again for inviting me to testify here. 

Mr. KAGEN. Thank you so much. 

Mr. James Duit, representing the American Concrete Pavement 

Association. Thank you for joining us. 

Mr. DUIT. Thank you. Chairman, Members of the Subcommittee, 

and distinguished guests, thank you for the opportunity to contribute to this progress report for the transportation infrastructure 

investments. 

My name is Jim Duit. I am the president of Duit Construction 

Company, a highway heavy contractor located in Edmund, Oklahoma. I am pleased to share my perspective today about the American Recovery and Reinvestment Act of 2009. 

Today I am speaking on behalf of Duit Construction Company 

and a joint venture partner, TTK Construction. Together, we were 

awarded five ARRA projects. I am also representing the American 

Concrete Paving Association as an at-large member. 

The concrete paving industry and we in Oklahoma welcome the 

arrival of ARRA. We appreciate the leadership of the President, 

Congress, the U.S. Department of Transportation, and the Federal 

Highway Administration. Also, a great deal of credit goes to Oklahoma Secretary of Transportation, Mr. Gary Ridley, and his talented staff. 

Of the $27.5 billion appropriated for transportation projects nationwide, Oklahoma’s share was $465 million. Oklahoma has led 

nearly every State in putting 100 percent of its transportation 

stimulus money to work and in applying stimulus funds to 274 

highway and bridge projects contracted in Oklahoma. To date, over 

70 percent of the work is completed and paid for. Working together 

in a joint venture, Duit Construction Company and TTK have been 

awarded five major projects totaling $140 million. These include 

two projects on Interstate 40, two projects on Interstate 35, and 

one on U.S. 69. 

32 

In my written testimony, I have provided specific project details, 

but for this hearing I want to emphasize four important hallmarks 

common to each project. 

First, we used environmentally friendly methods on all interstate 

projects by recycling the old concrete pavements back into the new 

projects. 

Second, these interstate projects are not quick fixes, but they are 

30-year pavement design structure. 

Third, the industry worked very closely with Oklahoma DOT to 

streamline planning and accelerating projects. 

Fourth, a research provision in SAFETEA–LU had a direct impact on the success of the design of these ARRA projects. 

In all, some 2.1 million manhours have been logged on ARRA 

projects in Oklahoma. Duit and TTK have budgeted 855 manhours 

for the ARRA projects. We are about 342 full-time employees, including subcontractors. For Duit and TTK, it was more about retaining personnel than creating new jobs. 

Based on our experience, I believe the critical success factors of 

planning and preparation by Director Ridley on ODOT were critical. When ARRA was signed into law, ODOT had identified and 

readied plans for more than $1 billion worth of projects, and I understand that the balance of these plans are still on the shelf, 

ready for future funding. 

Close communication among ODOT and the industry also 

factored heavily in the success in Oklahoma. Innovation and inventiveness were also key factors. This came in the form of new materials, designs, and construction. As mentioned previously, research 

also played an important part. Streamlining was a hallmark for 

these projects. Plans from conception to contract administration 

through actual construction were compressed to record times. 

Finally, there were contractors that were in dire need of the 

work, and the watch words of ‘‘use it or lose it’’ that was incorporated in the ARRA were not just a guiding principle, but a way 

of life. Words alone do not express the relief and gratitude of those 

of us that were fortunate enough to be part of this initiative. 

Even so, we are concerned about the future of our Nation’s surface transportation infrastructure. For example, we are witnessing 

a large number of talented, experienced, consulting engineers in 

the design community who are being laid off or are unable to find 

work. As noted previously, ARRA enabled us to retain workers and 

even hire 75 more for the 2009 and 2010 season, but the numbers 

are starting to fall as we complete work. A retained, experienced 

worker is extremely important to any company. 

Duit Construction Company has 75 employees who have been 

with the company for 5 years or more, representing a combined 

knowledge base of over 1,000 years of experience with Duit Construction and continuous experience in the highway construction 

industry; and many other industries and industry companies have 

similar stories. This is a tremendous amount of experience, and we 

do not want to lose this talent. 

Also, Duit Construction and TTK, like many others in the construction industry, are simply not comfortable investing in longterm capital expenditures in the current economic climate. 

33 

In the absence of a robust highway bill, transit program, a time 

for passage, or a durable solution to funding issues, many in the 

industry are concerned that the gains realized from ARRA will be 

lost without a robust highway bill now. Mr. Chairman, the concrete 

paving industry stands ready and willing to assist you and the T&I 

Committee, colleagues and staffers in finding and advocating for a 

workable solution. We are also receptive to ways that we can work 

together to advance the highway transit bill and to ensure that it 

receives the attention it deserves. 

Thank you, Mr. Chairman and Members. 

Mr. KAGEN. Thank you, Mr. Duit, and appreciate all the hard 

work you have been doing in Oklahoma. Some of that benefit comes 

back to the Federal Government as well, because when you have 

people working, they pay their Federal taxes, they stay in their 

own home, and we help solidify our housing situation. So thank 

you again. 

Mr. KAGEN. I now wish to introduce from my hometown of Appleton, Wisconsin, Mr. Kevin Gannon. 

Mr. Kevin Gannon, you have got 5 minutes. Thank you. Welcome 

to Washington. 

Mr. GANNON. Thank you, Representative. 

Mr. Chairman, Members of the Committee, my name is Kevin 

Gannon. I am vice president of Northeast Asphalt, Incorporated, 

headquartered in Appleton, Wisconsin. I am also the current president of the Wisconsin Transportation Builders Association and a 

member of the Board of Directors of the American Road and Transportation Builders Association. 

Northeast Asphalt is a professional asphalt production and construction services company founded in 1979 that operates in about 

30 counties in northern Wisconsin. We currently have approximately 300 employees. Due to the Nation’s economic difficulties, 

our employment rolls have declined by 7.5 percent since 2007. 

Mr. Chairman, I would like to again express our industry’s appreciation for the leadership of this Committee in securing major 

new transportation investments as part of the Recovery Act. These 

investments have been immensely successful in supporting transportation construction jobs in the United States. Over the last several years, our industry has witnessed recession-induced cutbacks 

in State transportation investment and a major decline in private 

sector transportation work. The Recovery Act’s transportation investments have been the lone bright spot for our sector. 

My own company, Northeast Asphalt, is involved with 66 Recovery Act projects in Wisconsin, and 7 projects in Michigan. The size 

of these contracts ranges from $2,500 to $16 million. Due to the 

more than 50 percent decline in our private sector work over the 

last several years, we have not been able to add new employees; 

however, our Recovery Act work has certainly helped us hold on to 

our existing workforce. 

I know creating jobs is a political hot button right now, but, as 

an employer, saving jobs is just as important to me. Few things are 

as difficult as having to let someone go because we do not have 

enough work. 

I would also like to point out that due to the overwhelming challenges our industry continues to face, many firms have been forced 

34 

to adjust their business operations to simply survive. Essentially 

we are doing more with less of everything, and this recent dynamic 

complicates our sector’s employment picture. 

As of July 16th, more than 11,000 highway and bridge projects 

had moved to the construction stage, and over 3,000 have been finished. Mr. Chairman, this means $23 billion worth of Recovery Act 

highway funds are either supporting projects currently under construction or already completed. This is $23 billion that is generating jobs in direct construction and the supply sectors, and all of 

it is boosting the economy. 

We saw an overall 7.1 percent increase in highway and bridge 

contract awards nationwide from 2008 to 2009. To further emphasize this point, the last page of my written testimony includes a 

U.S. map that shows 37 States and the District of Columbia increased highway and bridge contract awards in 2009. By comparison, in 2008, the year before the Recovery Act, 28 States decreased 

awards, while 22 increased. 

As undeniably successful as the Recovery Act’s transportation investments have been, this initiative was only intended as a temporary boost. It will continue to support transportation construction 

work and jobs in 2010. After that its impact will phase down quickly. Frankly, the uncertain outlook about the reauthorization of the 

Federal highway and public transportation programs is making an 

already difficult situation worse. It is not just the delay in passing 

the reauthorization bill that has our industry concerned, it is the 

uncertainty and trepidation caused by how the delay is being handled with short-term extensions and deficit spending. 

For more than 50 years, the Federal-aid highway and transit 

programs have been a model of responsible and stable financing 

from system users. That dependability, which is needed to plan and 

execute multiyear projects, is now threatened by a lack of the will 

to enhance Highway Trust Fund revenues. 

Mr. Chairman, I know you and other Members of this Committee 

are trying to address this problem head on, and we greatly appreciate your leadership. Until all Members of Congress and the 

Obama administration stop trying to avoid the situation, however, 

there is little chance of seeing true recovery in the transportation 

construction industry. This is a real-world consequence that directly impacts Northeast Asphalt, our employees and the State of 

Wisconsin. 

I appreciate the opportunity to testify, and I am happy to answer 

any questions. Thank you. 

Mr. KAGEN. Thank you, Mr. Gannon, and thank you for employing so many people in my hometown and my home district. I really 

appreciate it. 

Mr. GANNON. And we appreciate your help, too. 

Mr. KAGEN. I am sure all of your employees appreciate being 

able to pay their own bills and stay in their own home because 

they have a higher-wage job that is here and hasn’t been shipped 

overseas. 

I would like to ask all of you, because I will draw from all of your 

testimony that the Recovery Act or the stimulus act, as we know 

of it, has been immensely successful not just for your own businesses, but also the communities in which you employ people. It 

35 

has been immensely successful and beneficial not just to your company, but also to the communities. So I am going to ask you a hypothetical question. Had all of you been a Member of Congress, 

would you have voted yes in favor of passage of the Recovery Act? 

Mr. GANNON. Yes. 

Mr. SCHNEIDER. That would be yes for me. 

Mr. MACLOED. Yes. 

Mr. KAGEN. Mr. Millsap? 

Mr. MILLSAP. I have become a member so quick, I am not sure 

how to respond here. 

Mr. KAGEN. You are pleased with its passage? 

Mr. MILLSAP. We are certainly seeing the benefit of the passage, 

yes. 

Mr. KAGEN. Mr. Duit? 

Mr. DUIT. Yes, we are certainly seeing the benefit of the passage. 

And, yes, I would, but it would certainly have been nice if more 

than 4 percent was—were spent on highways and roads. 

Mr. KAGEN. That will get to my next question. 

Mr. Gannon? 

Mr. GANNON. I am very pleased with the highway portion of the 

bill. The entire bill, again, I would probably have a tough time. I 

can’t speak for the over 95 percent-plus. 

Mr. KAGEN. But you haven’t lost money because of the stimulus 

bill; you have been gainfully employing people, and you have been 

prosperous. 

You mentioned in your testimony, in your written testimonies, 

but for the fact the government stepped in to fill the void, the State 

didn’t have the funding, and the private sector didn’t have the 

funding for your businesses to continue on the path you are on 

now, and that has been universally true with everyone throughout 

the country. So I will assume that that would be a yes, you are 

pleased with the results if nothing else. 

Mr. GANNON. Yes, sir. 

Mr. KAGEN. Would you have voted for something that had even 

a larger portion for transportation infrastructure? 

Mr. SCHNEIDER. That would be an easy vote. 

Mr. KAGEN. That is an easier one, isn’t it? Well, that is part of 

the governmental process is the tug and pull here in Congress the 

way our Founding Fathers put us together. 

I am certainly not in control of this institution. Chairman Oberstar has been here a few years longer than I have, and he is not 

in control either, but this is part of the debate that takes place 

about where we can best invest our money. 

About how we are going to find the resources necessary to rebuild our Nation’s infrastructure, by some estimates we are about 

$2.1 trillion behind. I would like to hear from all of you about 

where you think those resources should be had. In Kevin’s testimony he suggested that we should stiffen up and be responsible 

and have a tax increase. So, Mr. Gannon, let me ask you straightaway, would you be in favor of raising the gasoline tax? 

Mr. GANNON. Representative, I am in favor of users—user fees. 

We all use the highway system, we all have the wear and tear on 

our vehicles, we all want the smooth roads. I am in favor of a gas 

36 

tax or another—other revenues to fund the Highway Trust Fund, 

absolutely. 

Mr. KAGEN. Mr. Duit? 

Mr. DUIT. The gas tax, as Congressman Oberstar had said, was 

really the backbone for all of our infrastructure and our interstates 

in the past. And the statistics show that 38 hours of every driver 

in the urban environment is spent in congestion, basically 1 week 

sitting behind a steering wheel that they really don’t have to do. 

I am not necessarily for the gas tax, but I think that that is a 

solution, an immediate solution. There are other solutions on the 

horizon, maybe a phased-in gas tax or other solutions in a longer 

period of time. Public-private partners certainly enters into this; it 

has in Europe for years. It will and has worked here also. 

Thank you. 

Mr. KAGEN. Mr. Millsap? 

Mr. MILLSAP. As first representing BNSF Railway, we are here 

privately financed. As a matter of fact, we are spending $2.4 billion 

on our own infrastructure, so I am not really in this debate. I 

would certainly agree that we are encouraged and get excited about 

public-private partnerships. That is a very good way to go after it. 

Mr. KAGEN. Mr. Macleod? 

Mr. MACLOED. Yes, I would be in favor of a gas tax increase. I 

am seeing that every day. When I drive past gas stations, prices 

go up 5 cents, and nobody seems to care. People are still filling up 

at the pump. 

I think we can use that money very effectively, but we also need 

to find another source, because gasoline consumption is going 

down, and we need a good funding source for the long term. 

Mr. SCHNEIDER. The administration, of course, laid out earlier 

today that the options infrastructure bank at 4- to 6 billion, that 

could be one or two projects. I mean, come on. 

Secondly, toll roads, try a toll road in the middle of the State of 

Wyoming. For rural States that doesn’t fly either. So in public-private partnerships, same thing for the rural part of the United 

States, which is where we operate on with a lot of our construction. 

So the gas tax was a tough vote. The alternative, if there is not 

a political will for a gas tax, would be a tax on petroleum. We think 

that that is another option, as long as it is dedicated to the Highway Trust Fund. 

Mr. KAGEN. I remind everyone in the room it was this Committee 

under the leadership of Chairman Oberstar that made certain that 

the funding portion within the stimulus bill that went into transportation stayed there, and we recorded—you are here today because of the process, the oversight process, of making certain that 

the funding that went into transportation infrastructure stayed 

there, and that is reported publicly and transparently. I don’t think 

the other committees that were involved in the creation of that 

funding source had the oversight that Chairman Oberstar had in 

terms of making sure we are all accountable. 

Mr. Chairman. Mr. Garamendi from California. 

Mr. GARAMENDI. Thank you very much, Mr. Chairman, and your 

line of questioning was superb. We have to come to grips with this. 

Some of us from California might remember 1990, when we actually increased the gasoline tax in California, took it to the vote of 

37 

the people, and they overwhelmingly supported it. I happened to 

have been the author of that bill when I was in the California Legislature. It was something that we did not fear as long as it is used 

properly, and the gentlemen at the table have used the money very 

wisely for the benefit of many. 

I did travel on Interstate 40 to observe some of the construction 

the Duit Construction Company was doing. Part of it was finished, 

and part of it was not, and there was some congestion, but I forgive 

you for that, because ultimately it will last for many, many years, 

and very, very well done. 

My question really goes to Mr. Macloed of Gillig, an issue that 

I raised once before here in this Committee hearing, and I will 

raise it again, and that is billions of dollars of our tax money has 

gone offshore to purchase rolling stock, buses, light rail, heavy rail, 

commuter trains and the like. It seems to me to be a perfectly foolish thing to do is to send our tax money offshore to purchase equipment that could and should be made in America. We should have 

a ‘‘make it in America’’ policy. 

Previous Secretaries of Transportation have overused the four 

waivers that have been in the law for some time. It is time for us 

to eliminate at least three of those four waivers and make it clear 

if it is our tax money, it is going to be spent in America to purchase 

rolling stock and equipment not only for the transit and public 

transit sector, but also for the other parts of the transportation program. So I have introduced legislation that would eliminate three 

of those four, leaving only in place the existing 25 percent waiver; 

that is, if it is more than 25 percent expensive to be built in America then a waiver could, but not necessarily would, be in place. 

I bring that to the attention of my colleagues. I am not asking 

for comments, but, Mr. Macleod, since you are one of, I think, only 

two bus manufacturers in America, you may want to indicate your 

personal or company feelings with regards to the proposal that I 

made. 

Mr. MACLOED. Yes. In my opening remarks I mentioned that 

Gillig was one of the last surviving American bus companies. Other 

transit bus manufactures like AM General, General Motors, Flexible have all failed and gone away. We can’t afford to do that; we 

have to have a manufacturing base here in this country. We invent 

things like the television and telephone, et cetera, and then we 

have them made in other countries. We can’t survive as a service 

organization; we have to be producing something over here. 

We make excellent buses. We have the technology, we have the 

people, and if it is our tax dollars, why should not we spend them 

over here? 

So I thoroughly agree with Congressman Garamendi’s bill and 

support him, and I hope you all will, too. 

Mr. GARAMENDI. Thank you, Mr. Chairman. 

And thank you, Mr. Macleod. 

Mr. KAGEN. Mrs. Napolitano. 

Mrs. NAPOLITANO. Thank you, Mr. Chair. 

To Mr. Millsap, I have the distinct, how would I say, privilege 

of having the Alameda Quarter East go through my whole district 

that delivers the goods to the rest of the U.S., and part of it is 

BNSF and Union Pacific. The question right now in many of the 

38 

areas, because the high-speed rail is being proposed for San Francisco to down south through us, that the railroads own most of the 

right-of-way, and they are a little reticent allow the high-speed rail 

to either build a third rail or to be able to utilize some of the lines 

that conceivably could be used for the high-speed rail. And, in fact, 

it was just released a couple days ago stating that they are moving 

forward on the high-speed rail authority that would slow down the 

goods movement. 

What is your opinion on that? 

Mr. MILLSAP. Congresswoman, I don’t know if you were here 

when I introduced myself—— 

Mrs. NAPOLITANO. No, I am sorry, I was not. 

Mr. MILLSAP. I am head of the bridge department. 

Mrs. NAPOLITANO. That is outside of your realm. Then I will pose 

another one to you, sir. My time will be running. 

Mr. MILLSAP. If I may, we will certainly have someone get back 

to you on that. 

Mrs. NAPOLITANO. I appreciate that very much. 

There is an overpass in one of my communities that the embankment had been eroding because of both negligence on the State’s 

part and also on the railroad’s, BNSF; that it would have been 

clogged up, and it was undermining the underneath, and that 

would have caused great concern, both the city and to the railroad, 

because that is part of the land that delivers the goods movement 

to the rest of the State. 

Yet when apparently you do have in the ability to be able—the 

contractual agreement that the city has to maintain it, yet it is 

called to both. If that were to go down, that rail line would be 

closed for quite a while. Yet we couldn’t get your officials to be 

more cognizant of the value to BNSF and to keep it moving, and 

they just totally moved away from it on being part of the solution 

in terms of funding. I would like to discuss that with you further, 

sir. 

Mr. MILLSAP. I look forward to that. 

Mrs. NAPOLITANO. Thank you. 

Do you have any concerns with any of the high-speed rail proposals awarded by ARRA? Do you have any comment? 

Mr. MILLSAP. I really don’t, in my capacity, no. 

Mrs. NAPOLITANO. Then to Mr. Schneider, to what extent does— 

and he has asked the question before, and I know that in my area 

there have been many jobs created because—or maintained because 

of ARRA. How has it impacted your business, to any of you? And 

had this not been enacted, where would you be? 

Mr. SCHNEIDER. Well, we have to track—as you probably know, 

with the ARRA spending, we have to track the number of hours 

and submit that. And to date it has been over half a million hours 

have been worked by Knife River on stimulus fund projects. I think 

you might have been out of the room when I mentioned that we 

have done about $200 million worth of stimulus projects to date, 

and we have $80 million of stimulus-funded projects in our backlog 

of work still to be built. So it has been huge. 

I think the one thing I would like to say and put it into context 

is you all know since 2008, the private market has collapsed in this 

country. We used to do about 60 percent public work, 40 percent 

39 

private work. The private work now is down to about 7 percent of 

the work that we do. So all of our eggs are in the public-funded 

basket. 

And so the stimulus spending right now is 18 percent for us. 

When that is gone next year—so that is going to have a revenue 

decrease of about 20 percent, but more importantly is the State 

DOTs. And most States have budget problems, as you know. They 

have all told us is next year don’t even think about the kind of 

spending from the State level that they have seen in the past. I 

was just in Idaho. Idaho DOT directors told everybody they are 

going to cut their budget next year by 50 percent. I believe a lot 

of other State DOT directors are saying the same thing. 

So we have double whammy: The stimulus is gone, and lack of 

a 6-year bill. And so it is really a train wreck about ready to happen unless we get the 6-year bill passed. 

Mrs. NAPOLITANO. My time is almost up. I have a few seconds. 

Certainly if you were able to convince some of the Members that 

are reticent to vote on that or to push that bill there is ways of 

being able to fund it possibly year by year as was suggested before 

and be able to extend it. So I would suggest if you make your statements known to this Subcommittee and to the Full Committee and 

Mr. Oberstar, because we all want to see it pass; the problem is 

the funding issue is what has been delayed, or at least from my 

own personal observation. 

So with that, thank you, Mr. Chair. 

Mr. KAGEN. Thank you. 

Ms. Richardson of California. 

Ms. RICHARDSON. Good to see you there. Thank you. 

I have just two questions that I would like to ask, the first one 

to Mr. Schneider and Mr. Duit. There has been discussion about 

the pending reauthorization, for it to come forward. And given the 

fact that I am not in the pavement business or the concrete and 

sand and asphalt business, can you describe to us—and I did go 

back and look in your testimony—what does it take for you to prepare to do a big project? Meaning, you know, how many months in 

advance do you have to get the necessary sand and asphalt and 

concrete and equipment? And what does it take to do a big job, and 

why is our continued delay so problematic in you being able to assemble the appropriate resources that you are going to need? 

Mr. SCHNEIDER. I will go first, Congressman, is if we get the notice to proceed, if we are the low bidder on a project, and we are 

what is called vertically integrated, and we produce the sand, gravel, and we also make the asphalt, and we make the concrete and 

then do the construction itself, if we get the notice to proceed on 

a project in California or wherever we are operating, we can be 

ramped up and we can be underway within 30 days, no problem, 

absolutely no problem. 

Now, the easier projects, of course, to do, and the ones that the 

DOT, of course, have really focused in on with the shovel ready, 

have really been the pavement projects, whether concrete or asphalt. And the reason for that is as opposed to new alignment, 

where you have to buy the right-of-way, and you have to get the 

permits and whatnot, which could be years, as this Committee well 

knows, an overlay can happen right now. 

40 

I have to tell you this. You really need to understand this. And 

I said about the real value, the value for the taxpayers today with 

the spending on these projects is just extremely good. The competition for these jobs, because there is very little work in the private 

market, it is brutal. Everybody is bidding this at low, low margins. 

So the taxpayer is winning right now, but we can ramp up very 

quickly. 

Ms. RICHARDSON. You are preaching to the choir on that last 

point. But I would say I thought I had heard that steel and some 

of the other things are in great need due to the increasing amount 

of work that China is doing. So you are not seeing that at all in 

your industry? 

Mr. SCHNEIDER. That may be an issue for the bridge builders, 

but for those of us in the pavement business, it is not an issue. 

Ms. RICHARDSON. OK. Mr. Duit? 

Mr. DUIT. It doesn’t take very long to ramp up for these larger 

projects. Availability of material is available. Our biggest concern 

is our people, maintaining our status of our people currently, and 

we have not seen any steel prices or shortage of steel in our current market. Our environment is extremely competitive, and steel 

and cement and asphalt, all of these products, are readily available. 

Ms. RICHARDSON. Again, Mr. Gannon, the question I have for you 

is in your remarks you had alluded to the fact that many companies, as well as municipalities, that were able to do additional 

projects than what we had anticipated because the numbers are 

coming back a lot lower than we had anticipated. Do you have any 

idea how many States, based upon your organization and/or 

projects, have been able to participate due to being able to 

deobligate and utilize unused funds? 

Mr. GANNON. I can’t speak for many other States, but I can tell 

you in Wisconsin there has been a number of letting savings. In 

fact, with the ARRA jobs coming to completion for bidding, they are 

going to add another bid-letting year towards the end of September 

for the leftover funds, which appear to be approximately 30 million. 

And I would echo what Mr. Schneider said. Due to material decreases and the intense competition out there, there is a lot more 

let savings than was anticipated, which is good for everybody. 

Ms. RICHARDSON. Mr. Chairman, I realize he is preparing his remarks. Might I suggest Mr. Chairman has been just one of the 

amazing folks out there not only urging with the reauthorization, 

but really bring value to what we did to the recovery dollars. 

Might I suggest that this Committee, we might want to get that 

number from the States, how many additional projects have they 

been able to fund due to the lower bids that have come in. And that 

is really a positive story that we should be adding as we are talking about the stimulus. Not only has transportation met in terms 

of what we anticipated, but we are actually funding even more 

projects than that. Very few Members have been talking about 

that. I am talking about outside of the Committee. 

Mr. OBERSTAR. If the gentlewoman would yield? 

Ms. RICHARDSON. Yes, of course. 

Mr. OBERSTAR. The number given by AASHTO, The Association 

of State Transportation Highway Officials, is 25 percent on average 

41 

nationwide. That is, bids have been coming in 25 percent lower 

than anticipated, and that has resulted in one-fourth more projects 

under construction than originally anticipated, which proves the 

point that we and this Committee made. 

And I am grateful for the support of all my colleagues on the 

Committee, including Ms. Richardson, who was very outspoken 

during that period of time; Mrs. Napolitano; Mr. Baird; and Mr. 

Kagen; and many others; Mr. Mica way back in December of 2008, 

who was very supportive of in the range of $100 billion investment 

in our surface transportation program. 

And it has now been proven that the State DOTs were ready to 

go with projects, the contractor community was ready, the sand 

and gravel sector was ready, the transit agencies were ready to 

award bids, and the producers like Gillig and O’Ryan and New 

Flyer and others were ready. They all stepped up and greatly exceeded expectations, even their own expectations. They were able 

to move things faster. 

The answer to your question is at least one-fourth more projects 

than originally anticipated, and that has resulted in 35,000 lane 

miles of highway improvement, 1,264 bridges rebuilt. You think in 

1 year, 1 year and 3 months, the contractor community, the State 

DOTs, the transit have built the equivalent of three-fourths of the 

mileage of the entire interstate highway program which took 50 

years to build. That is an extraordinary accomplishment. 

Ms. RICHARDSON. Dr. Kagen, if I could ask one last question, and 

it is to the three of them, it should only take about 15 seconds. 

Mr. KAGEN. Fine. 

Ms. RICHARDSON. Thank you. 

Gentlemen, of the three of you particularly that represent associations, one of our concerns is unbundling, that many of the companies that you work with subcontracting, the same folks get the 

same jobs. And part of why we did the recovery was to bring other 

people to the table. 

Could any of you share with us what you have done to reach out 

to our companies, particularly small business, to give them a 

chance to participate in some of these projects? 

Mr. GANNON. I will take that answer—question. 

Basically you are right, a lot of projects were unbundled, and like 

I said, we have done a number of projects being in the number of 

70, but a fair amount of them are subcontract work also. The State 

of Wisconsin did a nice job of diversifying the projects. A third of 

the money basically that went to Wisconsin went to local municipalities, and a lot of their work, which was a lot of small bridge 

work, those type of jobs, would happen in the private market, 

which is basically nonexistent. 

A lot of the other contractors and why we probably didn’t see our 

employment—our employee numbers go up is because a lot of other 

contractors that worked in the private sector have moved over into 

the public sector and worked on a lot of these municipal jobs. And 

the States will tell you there are a lot of contractors that they 

haven’t seen bidding jobs and being awarded jobs that used to work 

in the private sector. 

Ms. RICHARDSON. So, Mr. Schneider, Mr. Duit, and Mr. Gannon, 

if your associations could supply to the Committee any new conVerDate Aug 31 2005 11:17 Oct 25, 2010 Jkt 000000 PO 00000 Frm 00149 Fmt 6633 Sfmt 6633 P:\DOCS\57634.0 KAYLA
42 

tractors that have gotten a chance to work with you through this 

process, that would be helpful. 

Ms. RICHARDSON. Thank you very much. 

And thank you for your extending time. 

Mr. KAGEN. The madam’s time has expired. 

Before recognizing Mr. Baird, I just want to make the comment 

that at the time that we did pass the stimulus bill, our private sector economy was coming to a standstill. You may not have had the 

opportunity to come here to Congress, to be in the chairs that you 

are at. Your businesses may not have survived had we not invested 

in America’s infrastructure. It is a tremendous economic value, especially at today’s prices. So I want to thank you again and recognize Mr. Baird. 

Mr. BAIRD. I thank the gentleman for holding the hearing, and 

thank you all for your testimony. 

From what I have heard, we are putting people to work, we are 

getting a good buy for our money, we are building lasting infrastructure, and without it, many companies and individuals would 

have lost their jobs; is that a fair summary? So that must explain 

why everybody hates this bill. 

I have to say, those of us who have had the pleasure of town 

halls over the last year and had people screaming and shouting 

about how evil the stimulus is could use some cover fire. And many 

of us are going to go back home to our districts over August and 

try to talk about this. And, quite frankly, we need your members 

there. These are nonpolitical, public town halls with Members of 

Congress trying to get the story out about what we are doing to get 

people back to work, and it is just not right to have some poor 

Member of Congress having hundreds of people yelling at them, 

shouting them down, running against the stimulus. 

All across this country candidates for office are running against 

the stimulus, saying such preposterous things as it hasn’t created 

any new jobs. And their logic is awful. Their logic is, well, we had 

the stimulus, and there are still unemployed people; therefore the 

stimulus had no effect. 

So I would ask you what are you doing to let your employees, 

and their families, and your communities know that the stimulus 

is indeed having the aforementioned impact? 

Mr. Schneider. 

Mr. SCHNEIDER. Congressman, that is a great question. I can tell 

you that when I was back here in May for the TCC fly-in, one of 

our meetings was with Congressman Edwards from Waco, Texas. 

And he said exactly the same thing. He said, I am in a fight like 

I cannot believe, and the number one issue that my opponent Mr. 

Flores is using against me is my vote for the stimulus. He said, I 

got almost no appreciation whatsoever, when, in fact, it meant 

about $1.7 billion worth of work, Fort Hood, College Station, et 

cetera. And we walked out of that meeting like, well, that was a 

wake-up call for us. 

So what we are doing, Congressman, is we are having the Congressman appear at our employee meetings, and we are letting him 

talk to our people, and we are also thanking him in front of everybody. We should have done that before. We were ungrateful. I don’t 

43 

think he heard too many thank yous, and that is our mistake, and 

we are, I think, remedying that. 

Mr. BAIRD. I really appreciate that. 

Any others wish to address that? 

You know, we put $228 billion worth of tax cuts in that bill. Not 

a single person since we passed the legislation, not one, has come 

to myself or any colleague I know and said, thank you for the tax 

cuts. In fact, they tend to believe that taxes were increased. In fact, 

they were cut for over 90 percent of American people and businesses. 

Some of your members undoubtedly benefit from the small business loss carryback provision, I am guessing, that was in that. 

There was no gratitude there. 

If we are to continue to move forward, as I think we must, to rebuild this Nation’s infrastructure, and as this great Chairman Mr. 

Oberstar has led the fight to achieve, we have to get the story out, 

because I will tell you, if people who believe the stimulus has had 

no effect or even a negative effect prevail, there will be no more 

stimulus, there will be cuts in transportation funding, and we will 

go backwards, not forward, in fixing this Nation’s infrastructure 

problems. 

What would happen if we had another stimulus? There is a lot 

of debate about that. This time we won’t waste it on tax cuts, because those have been shown to be greatly appreciated. We will put 

it straight in the infrastructure. What would it mean to all of you 

if we had another infrastructure-based stimulus package? 

Mr. OBERSTAR. If the gentleman would yield, let me amend his 

statement by saying if the Senate were to pass the $34 billion 

HIRE Act that the House passed in December 2009. Be very specific about it. 

Mr. BAIRD. Anyone wish to? Would it hurt you? 

Mr. GANNON. I will take that question. 

Basically it would be stability to begin with, and hopefully 

growth. We were growing all the way up through 2007. Our company continued to add employees. In 2007, basically after that 

things started to go down, and I am actually looking right now, I 

feel, going into this fall, just like I did in 2008. 

I mean, it is almost deja vu, because in 2008, we were planning 

and looking at things that are very difficult to do when you are 

looking at taking your entire workforce—these are good-paying 

jobs, not minimum paid wages, and livable wages—and looking at 

your whole workforce and looking at a 20, 25 percent reduction, 

and that includes managers, staff, administrative, right down the 

line. So stimulus funding—and like we said before with the private 

market basically nonexistent, you know, it is scary where we are 

going. 

Mr. BAIRD. Any others? 

Mr. DUIT. I would like to echo what Mr. Gannon said. It would 

be very stabilizing for us. We are currently winding down some of 

our stimulus work. We do have other work coming available to bid. 

It is fiercely competitive, and we are just not sure where we are 

going to land. It certainly would help everyone. The values are 

great for the taxpayer, very, very good. The capacity is out there. 

44 

There is more than enough capacity to build. There is more than 

enough raw ingredients from raw material to build. 

I would like to share with this Committee one disturbing thing 

that was brought to my attention by our bonding company, if I 

might. I asked them straight up how long can contractors hang on. 

As you know, they have total financial disclosure to the bonding 

company. How long can the general contractors hang on? How long 

can the highway contractors hang on? And the answer was, we feel 

we are going to lose 15 percent of our contractors in less than 18 

months. 

So I guess my point is we are ready and willing. We can do it. 

Mr. BAIRD. I thank you. 

Mr. Millsap, did you want to comment? 

Mr. MILLSAP. Obviously in the railroad business, which is a very 

capital-intensive business, investment in the infrastructure is good. 

Investment in the infrastructure is good for our employees, for our 

people, for moving the goods in this Nation. So we are certainly— 

we look to making those investments. 

As I indicated earlier, obviously we are looking to opportunities 

for the public-private partnerships and what that does. I think that 

as we look at the railroad industry, we were seeing some positive 

turns. We were seeing some improvements, increase in our units 

that we are moving, which is a very positive thing. More investments in the infrastructure just helps out. 

Mr. BAIRD. Well, I want to thank you for your comments. I hope 

to see you all at town halls. It is desperately important that you 

show up. If not, you are leaving some good folks who fought hard 

for you, and fought hard for your workers, and fought hard for your 

industries, and fought hard for this Nation’s infrastructure, you are 

leaving them hanging out to dry, and the results will be bad for 

them, and bad for you, and bad for this country. They can’t succeed 

unless the people who are doing the jobs, employing the workers, 

getting the economy going are there, saying that is what is happening, because they are being drowned out by people who are just 

not saying the truth, and we need people who know the truth firsthand to be there. 

I thank the Chairman for allowing me a little more time. 

Mr. OBERSTAR. [Presiding.] I want to thank the gentleman from 

the State of Washington, where his comments were a penetrating 

observation here, questions that may have been a little uncomfortable to answer. But, Mr. Schneider, I thank you for your candor 

about the encounter with our colleague from Texas. 

But I also want to thank Mr. Baird for his service. It is not concluded, he has until the end of this session, but he has chosen to 

leave the Congress, and that is a loss for us. A person of his personal integrity, his vision, his oversight of the broader role of a legislative body, the numerous contributions that he has made, and 

the standard he sets for just personal and intellectual honesty and 

integrity, it has been a great support for all of us who serve with 

him and a standard for others to meet, but a loss that he would 

take this to other pursuits. 

Thank you for your great contribution. We will be thanking you 

more as we go on through the rest of this session. You are not gone 

yet. 

45 

Mr. Gannon and Mr. Duit, in Wisconsin there have been 418 

highway projects, by our count, under contract, underway or completed; and in Oklahoma, Mr. Duit, 266 projects. One of those could 

count perhaps as 50 or 60. The interdispersal loop is a massive 

project. 

And parenthetically I would like to observe that when Secretary 

Ridley was a witness before our Committee, I think he said it 

there, but I know he said this, that when he attended and was a 

witness at our hearing in October of 2008, he said, I went back to 

Oklahoma and gathered our engineering staff and said, this Committee is serious. I heard this Chairman talk about doing a stimulus program. We better be ready because something is going to 

happen. And he said, I ordered my engineers to start designing and 

completing the engineering work on the interdispersal loop, which 

turned out to be a $77 million project, if I recall rightly. He said, 

I told them I want you to take your plans to church with you on 

Sunday, because if I need to talk to you, I will. And he did, and 

they did. 

And that is the kind of spirit that we wanted from State DOTs. 

So they were ready, they were prepared, they went ahead. We had 

all the naysayers and the green eyeshade folk, I call it, at OMB 

and the Congressional Budget Office say, oh, it can’t be done, it 

doesn’t spend out that fast, it takes too long for these outlays to 

occur. But we know, all of you at this table know, that the jobs are 

out on the line before the money is paid out. So State DOTs surprised themselves by getting their projects out. If we had had a few 

more Gary Ridleys, I think, oh, you know, this place would have 

been hopping, but it was nonetheless. 

So how many more projects do you have, Mr. Gannon, in Wisconsin? Let me say the same for Frank Busalacchi, your secretary 

of transportation. He is just terrific. Unfortunately I understand he 

has a kidney problem and is having dialysis, which is really sad 

to me. There is a man of enormous vigor, and he inspired the department, as Gary Ridley did in Oklahoma. 

So you have these projects. How many more do you, by your 

count—you are not the administrators, but, you know, you talk to 

your colleagues in the business—how many more projects do you 

think, given this $34 billion we have already passed, the Senate 

has, it hasn’t acted on—if we put that to work now, how many 

more projects would you be able to do, say, in the next year? 

Go first, Mr. Gannon. 

Mr. GANNON. It depends on what we mean by number of—I can’t 

speak for what the State has on its shelf. The State of Wisconsin 

mandated this last year that they maintain 65 percent of the funding available plans on the shelf, because that is really where it all 

the starts is the funding to be in place, to be able to plan ahead. 

And you are exactly right, Mr. Chairman, to physically get the job 

going, but there is a lot that takes place before we are out there 

and actually working on the roadway. 

Basically Wisconsin did an admirable job of getting the projects 

out. They utilized the consultants—a lot of the consultants for designing and inspecting jobs also. And as far as number of projects, 

where we are going next year, and Wisconsin facing the $2.5 billion 

deficit, going the next biennium, we are very nervous where the 

46 

State will go with the highway funding. We have been very fortunate that we had legislators that have looked at things and have 

kept—you know, have seen the need for the jobs. One of the big 

things is jobs and jobs retention. So in your statement with a $34 billion would roll into the funds, 

we could easily match. We have completed over 84 percent of the 

stimulus projects; our company has 84 percent completed to date. 

Some of them are, like we said before, just milling overlays, and 

some of them are reconstruction jobs that will be going into 2011, 

maybe even 2012. 

Mr. OBERSTAR. But those are 100 percent funded projects, 100 

percent Federal funded. That gives you the certainty of the State 

doesn’t have to dig in and worry about where it is going to get the 

matching dollars. That is $529 million that was allocated to Wisconsin; you have got it under contract. And in Oklahoma, you had 

465 million allocated, 266 projects. 

If you had the same amount of money now, given the experience 

of the stimulus, knowing that you can get these projects underway 

much faster because you have had a selection process now, where 

do you think Oklahoma could go? 

Mr. DUIT. In my earlier presentation, Gary Ridley had indicated 

that he had—he will have over a half million—or half billion or 

500- to 600,000—or million dollars’ worth of plans ready, currently 

on the shelf, that could be going to letting as soon as funds were 

available. 

Mr. OBERSTAR. So that would be the equivalent of 268, 300-plus? 

Mr. DUIT. Exactly, exactly. 

Mr. OBERSTAR. And there has been some debate within the contractor, engineering and the State DOT community nationwide 

about state of good repair versus projects of a longer duration, 

those that would be more in the trade call capacity projects. Have 

you evaluated the balance between these capacity enhancement 

projects and the state of good repair and whether they are done 

concurrently or separately? Is there any distinction? 

Mr. GANNON. I will take that. 

Basically from the capacity, both of it—because there is over— 

I think it is in the area of about 15 percent of our roads are 

deemed unacceptable. And we have a balance of capacity enhancements. We have a $1.5 billion project that is just getting underway 

in Wisconsin, and it is starting the early stages of it, but the funding isn’t in place for the whole project at this time. 

So there has been a pretty good balance, but our roads are still 

in disrepair, yes. 

Mr. OBERSTAR. Not all are in the capacity category of the Milwaukee interchange, which turned out to be a very—a multibilliondollar project. I think it cost $50 million when originally built and 

10 times that amount to rebuild it. But that is what I am thinking 

of. 

Mr. GANNON. Yes. 

Mr. OBERSTAR. So you feel there is a balance of these that are 

in the ready-to-go category that could be underway now. 

Mr. Duit? 

Mr. DUIT. Absolutely. There is a good balance in backlog in Oklahoma. Four of the interstate jobs that we are constructing now 

47 

with the stimulus bill, one added the capacity, and the three others 

were overlay or total reconstruction. So the balance of the plans on 

the shelf are well balanced in the future, and I think they could 

be put to use very well. 

Mr. OBERSTAR. Mr. Schneider, you are involved in many States, 

and you have very broad experience. Can you relate to these questions I have asked? 

Mr. SCHNEIDER. Yes, Mr. Chairman. It really depends on the 17 

States we operate in. The vast preponderance of the stimulus has 

been towards paving and what we have seen in some capacity 

projects that we have been involved with and some in your district 

back in Minnesota. 

Mr. OBERSTAR. Well, that is—I think all of this is very, very instructive. The contractor community, the State DOTs all learned a 

great deal from this recovery experience, while there was resistance initially to my proposal that these prices be under contract in 

90 days, and we changed that to obligated in 90 days. And half of 

it obligated in 120 days greatly exceeded expectations. 

And AASHTO has given our Committee a list of 6,700 projects 

nationwide. All the States have done inventory. So these are 

projects that can be under contract in 90 days. That was the underpinning for the HIRE Act of December 2009. It stalled over in the 

other body as people were wringing their hands about our deficit. 

Well, if you don’t put people to work, you are not paying taxes, 

they are drawing unemployment compensation instead of paying 

taxes, and that helps to reduce this deficit, and we have something 

permanent to show for it. We have real and lasting benefits. That 

just exasperates me to no end when people don’t understand that. 

Now, Mr. Macleod, I have known you for a good many years 

through the Mineta Institute. I have made note, and I am going to 

use it in my future talks, no outsourcing and no offshoring. I like 

that. And there will be no outsourcing or offshoring in the future 

as the U.S. Department of Transportation, the Federal Transit and 

Federal Railroad Administrations proceed with development of 

standards for design and engineering of bus and rail transit vehicles. So that competition in the future will be based on U.S. designs, U.S. materials, U.S. products, putting U.S. workers and U.S. 

companies to work instead of, as you saw, on certain—and I know 

all too well because I held hearings on it at the time—in the 1960’s, 

we lost this engineering and technical design capability, and it all 

went offshore because we simply disinvested, just eliminated funding for streetcars, for what we call today light rail, for commuter 

rail, and for bus transit systems in favor of the automobile. 

Now there is a revival. There is a revival in inner-city passenger 

rail, there is a revival in transit systems. We were, until the recession, adding a million new riders a day for transit; for 2 years ago, 

10.5 billion transit trips a year. 

So with what the administration is doing, and I think it is a tremendous initiative, what do you think will be the future for transit 

investments as we continue? Our bill, by the way, reported from 

Subcommittee last year doubles the funding for transit over the 

next 6 years of this legislation. 

Mr. MACLOED. Mr. Chairman, we definitely need that. Talking 

about the technology, our buses are superior to European buses 

48 

and to Far Eastern buses. I was in China a month ago, and our 

buses have better technology. They are safer. We have been using 

hybrids for a lot longer than any of the other countries have in 

buses. We have been networking our electronic systems in our 

buses. 

So we certainly have the technology, we have got the capabilities, 

we have the capacity. All we need do is get the orders, and the orders depend on funding. And I think doubling the new transportation bill from the SAFTEA–LU level would be excellent because 

we need that. We need more buses, and we need more infrastructure. I am just talking about the bus side of it because that is 

where my knowledge is. 

You were also talking about putting people in jobs straightaway. 

At the Mineta Institute meeting in January of 2009, we talked 

about the stimulus bill, and we went back and started preparing 

so that in March we were actually hiring additional people to take 

up our production. It takes us a little while, so we are slowly edging up the production. 

So we were right there. And I think all of transit and all of 

transportation is capable of doing that. And the jobs we create are 

here in the U.S., and they have this spillover effect or multiplier 

that creates other jobs in the supplier base. 

Mr. OBERSTAR. In your experience in the various communities in 

which—to which you market your transit vehicles, are you seeing 

a continued growth in ridership, in use, and design and engineering plans for the future? 

Mr. MACLOED. Yes. And we did see a spike when gasoline prices 

went up. So I think if we add a tax on gasoline, I think we will 

push people into using transit. And once they started using it, 

when the prices came down, people stayed with transit. They found 

it was more convenient. It eased congestion for other people who 

have to use the roadways, like delivery trucks and things. 

Mr. OBERSTAR. Thank you. 

Mr. Millsap, in your work with the Truman-Hobbs Act and the 

bridge removal or reconstruction/rebuilding, do you know of other 

projects that are on your horizon or on your radar scope that need 

attention and that could qualify for a future stimulus program? 

Mr. MILLSAP. Chairman, I certainly do. I think that you are certainly familiar with one. It is Tower 55. It is not a bridge project, 

but it is Tower 55, the rail intersection in Fort Worth, Texas. 

Mr. OBERSTAR. Oh, yes. I may be going to see that in a few 

weeks. 

Mr. MILLSAP. It is certainly a project that is looking for support 

and for funding. Obviously 100 trains a day meet at that intersection. BNSF and the UP, the railroads are certainly partnering up. 

And understand this is TxDOT’s number one project. They will be 

making, or have already filed, a preapplication for TIGER 2. So 

that is certainly one. 

And another one, you made reference to a bridge. Yes, on the 

Mississippi River, Fort Madison. Fort Madison is the bridge crossing the Mississippi River. The Coast Guard issued again an order 

to alter that bridge in 2001. And as of right now, I believe there 

is about $5 million that is allocated, appropriated for replacing the 

swing span again and installing a modern vertical lift. That project 

49 

will be something in the 70-, $75 million range. So certainly a long 

ways to go, and I hope that we don’t have to wait another 18, 19 

years to make the improvements on that bridge. 

Mr. OBERSTAR. A structure of that kind is truly an obstacle to 

navigation, and that is what the Truman-Hobbs Act is designed for, 

to remove obstacles to navigation. 

Mr. MILLSAP. That is what occurred in 2001, whenever the Coast 

Guard issued the order to alter, because it was identified as an unreasonable risk or hazard to navigation. 

Mr. OBERSTAR. I am enjoying this opportunity to exchange with 

you and get your thoughts and inputs, but we have other Members 

here who have their own comments and questions. I want to turn 

to them. 

Mr. Schneider, would you please give Joyce Fisk a hug for me, 

if that is acceptable in your arena? But, you know, just tell her it 

is from me. 

Mr. SCHNEIDER. As long as it comes from you, I can do that. 

Mr. OBERSTAR. She is a honey. She is just terrific. She is the 

human face of stimulus and has been an inspiration daily for me. 

Just one observation. We talked a little bit ago about financing, 

and I think the comments of—let us see, who was it that said we 

have a lack—Mr. Gannon, you said it well, a lack of will to enhance 

the revenue stream. That was very nicely, euphemistically put as 

no guts to raise the gas tax. 

It was Dwight Eisenhower, the very apostle of conservatism, who 

said we need a gas tax, we need a user fee to finance the Interstate 

Highway System and the Highway Trust Fund, and he signed it. 

And 2 years later, that was 1956—2 years later the Bureau of Public Roads came back to the Congress and the President and said 

that 3 cents isn’t enough; we need another penny for what was to 

be a $22.5 billion Interstate Highway System that eventually committed $125 billion in 1960’s dollars funds. That 1 cent passed the 

House on a voice vote. You can’t pass the prayer on a voice vote 

today. The way to clear a room of Members of Congress is to stick 

your head in and say, gas tax, and they all run for cover, or any 

kind of tax. 

But it was years later that Ronald Reagan, in 1982, said—faced 

with a proposal from this Committee, from our then-Chairman Jim 

Howard, a Nickel for America—who said no, and then signed it, 

saying, quote, this user fee is budget neutral. The users of the system are paying for it, maintenance and upkeep. And this 5 cents 

represents the cost of two shock absorbers in a year for the drivers 

on our systems. It was good enough for him to sign. Why isn’t it 

good enough for modern-day conservatives to sign up for? 

And there was George H. Bush who supported—signed a 5 cent 

increase in the gas tax, half of which to go for a deficit reduction 

for 3 years and then be repatriated to the Highway Trust Fund. 

Who are these self-appointed conservatives who say that the 

users of the system shouldn’t pay for it? That is nonsense. Mr. 

Macleod said very well, just stand on a street corner, and gas 

prices will go up 5 cents. Of course, in the afternoon they change 

that sign, and now they do it electronically. They used to have 

someone come out there, go on a ladder and hang up 2 cents. Now 

it goes automatically. And where is it going? United Arab EmirVerDate Aug 31 2005 11:17 Oct 25, 2010 Jkt 000000 PO 00000 Frm 00157 Fmt 6633 Sfmt 6633 P:\DOCS\57634.0 KAYLA
50 

ates, and to Saudi Arabia, and Venezuela, and to our friends north 

of us, to Canada. They are happy to take that increased money. It 

is not going to the Highway Trust Fund, it is not going into our 

bus and transit system, and we need to recapture that. 

What we need is not just will, we need a few political guts to 

stand up and say, yeah, this is what we need to do. This is in the 

best public interest to invest in our own system that the users of 

it are actually paying for it. And while public-private partnerships 

have been popular in Europe, they are for very limited, big-scale 

projects like the bridge on the border of France and Spain. I have 

the video on that construction project. 

Wonderful, marvelous project. That is one project. It is not a system. And I think, Mr. Duit, you said, I think, you set out in Wyoming to try to put in a toll road. That just doesn’t work. 

Mr. Petri has just arrived, but Mrs. Napolitano had her hand up 

earlier. I will recognize her for 2 minutes and then go to Mr. 

Boccieri. 

Mrs. NAPOLITANO. Thank you, Mr. Chairman. I won’t take 2 minutes, but just to comment, to follow up on Congressman Baird’s 

comment about letting people know that the ARRA funds have created jobs. May I suggest, Mr. Chairman, that maybe an op-ed 

piece, with your name and theirs, to the newspapers stating facts, 

not making up, but stating facts that you have been able to keep 

people employed in those areas where it has been more critical. Because he is right; if you only tell some employees, that won’t be 

enough to spread around to the areas where people are condemning 

the spending of funds unnecessarily but people have been put to 

work in many of those areas. 

So either that, or letters to the editor from some of your own 

folks who have been able to have gainful employment would be 

helpful to be able to put an end or at least try to counter the claims 

that there have been no jobs developed through this ARRA funding, 

Mr. Chairman. Thank you. 

Mr. OBERSTAR. Thank you very much. You are right on. You all 

can help each in your own way. 

Mr. Johnson. 

Mr. JOHNSON OF GEORGIA. Yes, Mr. Chairman. Thank you. Before I make a statement, I must—before I ask questions I must 

make a statement. 

Back during the deliberations of the House of Representatives, 

the Democratic caucus on the Recovery Act, whether or not we 

should actually pass it or not, and if so, what should be featured 

in it. I believe that the Chairman was a strong advocate for $500 

billion, if I recall correctly, for transportation and infrastructure investment as a part of the Recovery Act. And that amount unfortunately was watered down and we ended up with what we got—I 

think it was around maybe somewhere between $100 billion and 

$200 billion—for transportation and infrastructure projects in the 

recovery package. Is that right? 

Mr. OBERSTAR. The total for our Committee was $64 billion, 

which accounts for 8 percent of the total Recovery Act funding. And 

of that $64 billion, $35.9 billion is in highway and transit. 

Mr. JOHNSON OF GEORGIA. Well, that is a long way from the 

$500 billion that was being advocated. 

51 

Mr. OBERSTAR. That is for a 6-year program. 

Mr. JOHNSON OF GEORGIA. And I am happy that we got that despite—I am happy we got what we got, despite it being less than 

what I thought it should be. And if we had had a more robust recovery agenda focused on job creation through transportation and 

infrastructure development, I think we would show a much 

healthier result than what we are showing now in terms of job creation. 

Certainly the number of jobs that have been created is nothing 

to sneeze at by this recovery package. I am just simply, Mr. Chairman, wanting to have a more robust transportation and infrastructure program fully funded, as the Chairman pushed so hard for 

during these deliberations on this act. 

I mean, 11,382 jobs created in Georgia just based on roughly onethird of the recovery money having been expended thus far, 11,382 

jobs; 1,780 jobs created just during the month of June. This is substantial stimulus to the economy. 

We all know that unemployment numbers are unacceptable, and 

we have been trying to bring those numbers up. But because our 

programs and projects keep getting watered down, America continues to have its infrastructure be used up and maintenance deferred and new construction put off and jobs— and the job numbers 

remain too high, and we are not recovering from the economic disaster that the previous administration left to us quickly. And so 

the American public is left to feel that we are not doing enough, 

and I agree with them. But, unfortunately, we have done as much 

as we could do under the circumstances. 

But I want to thank you all, gentlemen, for your work as small 

business people. And we all know that small business is the job 

creator in our economy. And to the extent that we enable and empower small business to develop, you know, to that extent we get 

job creation. So I want to applaud you all for the work that you 

do in representing before this Committee the efforts of small business and the effect of small businesses on job creation. And this, 

despite the withholding of capital that you need to expand your 

business. 

All of those things coming from—and we just had Wall Street reform, but we know that those financial entities are holding onto 

their gains that they have made during the Obama administration. 

They are holding tight. Credit is tight. Their profits are up. And 

all of this seems to be in keeping with the strategy to obstruct success by the Obama administration which was announced by my 

good friend, Rush Limbaugh, the leader of the party on the other 

side, and they have held fast to this strategy. And that is just the 

truth of the matter. 

And so I look forward, Mr. Chairman, for the future. We have got 

to stay the course. America needs infrastructure improvement. It 

needs more transportation dollars. There are some tough decisions 

that have to be made in the future, and this body will be viewed 

in history with an eye towards determining whether or not we did 

what was best for this country or whether or not we kicked the can 

down the road for another session. And I am not frustrated, Mr. 

Chairman. I am actually ready to go to work and make some tough 

choices. 

52 

And with that, I think all of the questions that probably should 

have been answered were—or should have been asked have already 

been asked and answered, and I just wanted to throw my little two 

cents in. And thank you very much for holding this very important 

hearing. 

Mr. OBERSTAR. Thank you. I thank the gentleman for his observations and for his support and for his consistency. And with that 

kind of support, and support from this panel and the members of 

the associations they represent, we will get there. We are going to 

do this long-term transportation bill. We will make it work and we 

will have a brighter future. 

Mr. Petri. 

Mr. PETRI. Mr. Chairman, thank you for having the Secretary of 

Transportation and other members on these two panels giving us 

an update on the progress report of this important legislation. 

I apologize for not hearing all of your presentations, but I still 

have a question. And since there is a fellow Badger on the panel, 

I thought I would ask Kevin Gannon and Northeast Asphalt, which 

is speaking for the Transportation Association, is a well-respected 

and well-known firm in our part of the world. 

Toward the end of your statement, to just quote from it, and it 

fits into what was just being said, you talk about the difficulty in 

the last 2 years, and then you say, ‘‘Frankly, the uncertain outlook 

about the reauthorization of the Federal Highway and Public 

Transportation programs is exacerbating an already difficult situation. It is not just the delay in passing a reauthorization bill that 

has our industry concerned; it is also the uncertainty and trepidation caused by how the delay is being handled with short-term 

extensions and deficit spending. 

‘‘For more than 50 years, the Federal Aid Highway and Transit 

program has been a model of responsible, stable, and dependable 

financing, user-funded and deficit-neutral. That dependability, 

which is so critical to planning and executing multiyear construction projects is now threatened by a lack of will to enhance the revenue stream to the Highway Trust Fund to reflect today’s realities.’’ 

I wonder if you could use a few minutes I have of my time to 

expand on that a little bit. And I know we are hearing in general 

a lot of, if you want to say, malaise or uncertainty in the business 

community as to the path forward. And so people are making 

money, but they are sitting on their cash and the piles are building 

up within the business sector because of not having a clear framework in a number of areas in our economy. At least that is a concern that I am sure you have heard and that I hear. 

But it is particularly the responsibility here of us in the Transportation Committee, and I know the Chairman has been leading 

the way, trying to plow ground to get people organized to get this 

reauthorization done. It is way overdue, and it is looking like it is 

going to be even further. And there is a cost to it, as you allude 

to in your statement. 

So if you could expand on that a little bit and why it is important 

to get a good framework in place, not just transportation, but for 

the country. 

Mr. GANNON. Absolutely, Representative. 

53 

Basically in our business, we always look for capital expenditures. And what I mean by ‘‘capital expenditures’’ and ‘‘capital investment,’’ it is in equipment for, first of all— because in our business it is very capital intensive. You start talking about buying 

pieces of machinery that are $500,000, or million-dollar pieces of 

machinery, you need to know that you have an outlook for work for 

3, 4, 5 years, that there is stability there. 

Along with that goes capital investment in people. You know, if 

you don’t see the work coming, it is pretty tough to hire somebody, 

or hire a young engineer coming out of college, not knowing if you 

are going to have work in the future; because when you bring them 

in, you have a lot of training and that to ramp them up for work. 

Along with that is a workforce. You know, being in the northern 

climate, you know, 6 to 7 months a year a majority of our workforce is working. We ramp down pretty heavily in the winter on repairs and things like that. But even in the repairs and that, what 

machine are you going to be using the next year? Are you going 

to have work for it? Those type of things. 

I have had a number of employees come up to us, come up to myself, even last week I had one come up. A 13-year employee comes 

up, young man, and pulled me aside—we were doing safety audits, 

you know, that we go out and see all the crews—and basically 

pulled me aside and said, ‘‘You know, Kevin, I just really need to 

hear it from you. My wife wants to have another baby.’’ He says, 

‘‘I am sitting here with a 3-year-old,’’ and told her, ‘‘I don’t know 

what I am going to have for work in the future.’’ And a good employee and everything else. I don’t know what next year is going 

to bring. But along with that is the manhours. How many hours 

are men working and are employees working? You know, in a 7- 

month season, most of them work more than 40-hour weeks. 

So those type of things all come into play when you look at what 

you have down the line, you know, that planning. The States, are 

they really going to get into designing? It takes a number of years 

for them to put plans together and get them on the shelf and plan 

their projects. So, you know, if the States aren’t designing and consultants aren’t designing and putting plans together, that work 

isn’t going to hit the street. 

So when the stimulus does come up, the last year and a half it 

has been great, it really filled the void in the private sector. No 

doubt about it. But again, like I said earlier, I really feel right now 

that I am looking at where I sat back in 2008, wondering what is 

going to happen in 2009. The talk was there about the stimulus. 

But should that not have happened? Heck, I don’t know. Maybe I 

wouldn’t be here today. 

So I guess kind of telling you how it is a longer-range planning 

business is what we look at. 

Mr. OBERSTAR. Thank you for a very candid and thoughtful response to Mr. Petri’s question. That really brings it home personally, just as Joyce Fisk did to me on the construction site. She said, 

‘‘Thank you for my job driving a truck on the I-35 rebuild project 

between North Branch and Rush City.’’ She said, ‘‘Two months ago, 

my husband and I just finished dinner. We sent Austin to bed, our 

10-year-old. And then we looked at each other and said, Where do 

we go from here? Our health insurance ran out in December. Knife 

54 

River carried all of its employees through Christmas, to the end of 

the year; but then with no jobs, no revenue stream, they had to cut 

off the health insurance, and our unemployment comp ran out. We 

have 2 months’ savings to pay the mortgage. And are we going to 

be able to send Austin to summer camp?’’ And then we hugged 

each other, cried, and went to bed. 

‘‘And the next morning, Knife River called and said, ’Report for 

work on Monday. We won the stimulus bid on I-35.’ And now, if 

I can get my 600 hours in, I will get my health insurance reinstated. My husband as well. Gene works for Knife River. We are 

paying the mortgage. We are buying the groceries. And we are 

sending Austin to summer camp.’’ And I think she and Gene have 

sent Austin to summer camp this summer as well. 

But that is the story of your employee as well. And that story 

is written all over the country, the 1,300,000 jobs created by stimulus. But we need that continuity and we need that long-term stability in the program. And that is what the Highway Trust Fund 

has given us and that is what the highway user fee has given us, 

is the continuity to know that at the beginning of the project, when 

you design it, you will be able to finish it, and not have projects 

half done all over the country, as happens in Third World nations 

and as happens even in First World industrialized nations in Europe, because they don’t have a steady guaranteed revenue stream 

that is not part of the general revenues of the national government. 

Mr. Boccieri. 

Mr. BOCCIERI. Thank you, Mr. Chairman. Thank you for your 

leadership on this issue. 

Congressman Oberstar, Chairman Oberstar, obviously feels very 

passionately about transportation infrastructure needs in our country, and I firmly support his endeavors. 

You know, he always says that we need to do the right thing. We 

just don’t run for office to win elections; we run for office to get 

things done. And there is probably no other Committee that we can 

get things done quicker and have such a broad and vast impact 

into the Nation’s economy than on this Committee. And that is one 

of the reasons why I am here. 

On the Stone and Gravel’s testimony, they talked about how the 

U.S. population has increased 34 percent since 1980. Registered vehicles are up by 55 percent. Number of miles that the Americans 

travel every year has doubled by 97 percent. That being said, obviously user fees, such as the gas tax and what-not, add to the trust 

fund so that we can do the kinds of projects that are so necessary. 

However, with the advent of alternative energies and with the 

advent of cleaner burning fuels, more longevity in terms of the 

number of miles that we can get, and even gas-electric hybrids— 

In fact, there was a report that said that if 27 percent of the vehicles on the road were gas-electric hybrids, we could eliminate our 

dependency on oil from the Middle East. Forty percent of our oil 

comes from the Middle East right now. 

So that being said, what are the associations, what are the private sector willing to support in terms of a broad-based approach 

to having this trust fund emboldened and used for future generations? 

Mr. SCHNEIDER. Thank you, Congressman. 

55 

The issue you laid out is very clear, is we have got two things 

going on: the purchasing power of the gas task, since it hasn’t been 

increased for so many years, has dropped; fuel efficiency hybrids, 

et cetera. And we have talked with the Chairman on a couple of 

occasions about vehicle miles traveled, the basis, something along 

those lines. 

The fact of the matter is, though, is whatever change we do 

make—and there are some good ideas that are out there—the 

amount of time that it is going to take I think to steer the ship 

to go to a new funding mechanism is going to be a very lengthy 

process. Just the mechanics of getting it instituted, some of the 

States have tried to do this and it has met with some strong resistance, as you know. 

So, in the meantime, I think what we are all doing is we are 

watching the clock on the wall, and this is what we see in the scenario. Most of the stimulus spending will have been spent by the 

end of this year. And without the 6-year highway bill, as we know 

with the State budget problems with 40-some percent of the States 

having deficit issues, is they are going to be cutting back their 

transportation spending by anywhere from 30 to 50 percent. 

So the fire is in the building right now, and we are going to dip. 

And so to do something to change the gas tax, or to another, we 

don’t have time to do that right now, 

Mr. BOCCIERI. Let me ask a question. Ohio has a gas tax. In fact, 

every time I fill up my tank there is a placard by the vendors that 

say, ‘‘46 cents out of every dollar that you spend is going to the 

government, in some way suggesting that we are using it for things 

other than transportation and infrastructure needs. 

Ohio has a gas tax, and that goes into a trust fund much like 

the Federal Government has. Do other States not have a trust 

fund? Are they spending this out of their GRF, their revenue budgets, to do this; or do they have designated funds that are used specifically for that? 

Mr. SCHNEIDER. Some States do have designated funds, like 

Texas, for example. Others, it goes into a general fund. 

Mr. BOCCIERI. And that is the big issue, is the fact that designated funds are going to be spent irrespective. Ohio, this year, is 

spending $2 billion on transportation and infrastructure needs, and 

then next fiscal year will be spending another $2 billion on transportation and infrastructure needs. We do have those dedicated 

funds in Ohio. 

There was a study out that said that $600 billion needs to be 

spent every year for the next 10 years just to get our infrastructure 

modernized and up to speed with our competitors. 

That being said, China is doing that just in the next 2 years, $600 billion over the next 2 years, which makes us, I should say, 

vulnerable in terms of if we are not going to be able to build it here 

and transport it and have intermodal facilities that allow for efficiency of transportation, our economy is going to be challenged by 

other countries that are doing this. 

So we need to find some way, whether it is a transportation infrastructure bank, whether it is the fees that we have, or other 

sources of revenue, to make sure that this is indexed; that it 

doesn’t have to be a political football to be thrown back and fourth; 

56 

and that we can get this done so that we don’t have to have this 

discussion. 

Thank you, Mr. Chairman. 

Mr. OBERSTAR. That is very true. We shouldn’t have to have this 

discussion. It ought to have been a readily accepted principle that 

we have had this enormous success with the Highway Trust Fund 

and with the user fee, and it has brought the Nation the greatest 

mobility of any country in the world, produced the most extraordinary transportation system of any country in the world. 

China is working hard now to equal ours. They had 167 miles 

of interstate-quality freeway in 1978; they now have 25,000 miles. 

Their goal is within 10 years to have 52,000 miles of six-lane interstate-quality freeway linking the nation, moving heavy loads of 

goods and tens of millions of people. 

And India is on track with their Golden Triangle project, over $25 billion initiative to build something in the range of 25,000 lane 

miles of interstate-quality freeway. 

The European community, the Transport Ministry, with the consensus of 27 individual transport ministers of the member countries of the European Union, 9 years ago launched a 20-year $1.4 

trillion surface transportation investment program to double the 

miles of inter-city high-speed passenger rail—that is 186- to 220- 

mile-an-hour speeds; to develop freight rail which they don’t have 

in the capacity that we have in the United States; and to build a 

2,000-mile canal through the heart of Europe, linking the North 

Sea to the Black Sea. 

Now, that is the kind of vision we need in America. That is what 

we did in 1956 and what this Congress launched in 1956 with the 

Interstate Highway program. It was called the National System of 

Interstate and Defense Highways, because Eisenhower understood 

very well if you do something in the name of the Nation’s defense, 

it will sell a lot easier. 

Well, we were also on course to kill 100,000 people a year, because our highways were choked with traffic and the roadways 

were inadequate and they hadn’t been improved, and we needed 

something vast. Our gross domestic product was $345 billion in 

1956. We had, on average, one car per household. That one car 

drove 9,600 miles. Today, we have nearly three cars per household 

and driving 15,000 miles per year. It took 65 years for the Nation 

to drive 1 trillion miles cumulatively in 1 year, and then it took 

only 20 years to get to the second trillion miles, and then only 10 

years for us to drive 3 trillion in a year. Mileage driven has outpaced population growth by a factor of 3- and 4-to-1, and we have 

to keep pace with that growth. 

We had 1 million trucks in 1956. There are 7 million trucks on 

the Nation’s highways today, delivering goods all over America, 

part of that mobility. 

Amazon.com depends on trucking, depends on the U.S. Postal 

Service, and UPS and FedEx, to deliver their goods to their final 

destination, and so do all these other Internet companies in which 

you can sit down in the comfort of your home, order whatever 

goods you want, and our highway system is going to deliver them 

ultimately. They don’t come through the ether. They don’t come by 

broadband to your doorstep. They come via roadway, and those 

57 

roadways weren’t sprinkled there by manna from heaven, as with 

the Israelites in the time of Moses. This is—we have got to build 

it ourselves. And I just get—— 

So if you look at the surface transportation needs, we have roughly a $53 billion-a-year program; two national commissions 

recommended going to $450 billion. We took those recommendations seriously. We held hearings. Mr. Petri sat through a great 

deal of that. He was part of shaping the bill, a leader in shaping 

the bill that we know today as SAFETY–LU, and authorized the 

two commissions to make these findings and recommendations. So 

if you go between the $53 billion a year and the needs of those 

commissions, that comes out to $140 billion over 6 years. That is 

a roughly a $23-billion-a-year gap between where we are and 

where we need to be. And at $1.8 billion in revenue from percent 

increase in the user fee, 12, 13 cents, even 15 cents would get us 

there, and you could phase it in over a period of time. But if you 

start it now, then the contractor community sitting at this table 

will know what they can do and will know what is in front of them, 

and they can plan accordingly. 

And I think Mr. Gannon said it very well. If you are going to 

order heavy equipment, you have to know that you are going to be 

able to amortize it. You can’t just go and buy it and then sit on 

it for 6 months or 1 year or 2 years. You have to know that you 

are going to be able to put it to work and hire people and pay 

them. And that is what this system is about. 

So I looked at every revenue option with your associations, with 

U.S. Chamber of Commerce, the National Association of Manufacturers. Mr. Mica sat in those meetings with me. Ultimately, it all 

comes back to the user fee. The users are paying for it. It is not 

a general tax. It is dedicated to a very specific purpose. It is clear 

and transparent. At any rate, you are the choir; I am the preacher. 

You are awfully good to listen. 

Mr. Petri, do you have any closing observations, comments? 

Mr. PETRI. No. It has been a very interesting hearing. We I think 

in a sense are preaching to the choir. But it doesn’t just affect us. 

I mean, obviously if you are a contractor, you are worrying about 

having a framework. But at the end of the day, our neglect or failing to put in place a good roadmap and framework in the transportation sector is going to increase the risk that our economy will not 

be able to grow efficiently going forward and will undermine the 

extent to which we can have confidence in a higher standard of living for our children than we have had for ourselves. 

We often talk about each generation trying to pass on more opportunities to the next, and that has been one of the things about 

our country. And as you so well pointed out, a robust, efficient 

transportation sector really makes possible a high standard of living. And we have that now, but it is not perfect, and there is a lot 

more to be done. And we really should be getting about doing it 

rather than just engaging in short-term, fill-in efforts that don’t 

allow people in various sectors to plan adequately, and that also 

postpone the day when we will be addressing those problems and 

make it an even bigger challenge. 

Schneider Trucking in our area has been a leader for years in 

what they call logistics, and they pointed out that the efficiency 

58 

that we achieved through steady investment in transportation enabled the—and modernization of our manufacturing sectors to 

squeeze out inventory and the like that was not necessary, enabled 

us to move about 6 or 7 percent of our economy from paying for 

logistics to paying for other things. And that really basically was 

where we managed to pay for the health care increase in our country,. 

And now that is no longer happening. The efficiency in our transportation sector has leveled off, and now it is starting to eat up a 

little bit more and a little bit more of GNP, And that is causing 

real anguish in other parts. It all has to add up to 100 percent, so 

that is another percent you can take out of logistics to move over 

to health care. Suddenly we are getting into sort of a real budget 

crunch here in our country. 

So there are a lot of opportunities to have greater efficiency 

through integration of the road-rail network, more efficient systems 

time—if we can go to satellite road use, we can use the existing 

system more efficiently than ever before and have a higher standard of living. But it is going to require planning and it is going to 

require investment and requires a framework. And our job is to 

provide that framework. That is really what we have to do. 

And I just hope that our Chairman and Transportation Secretary 

can figure out a way of getting some kind of a little national summit or something with people in the administration, so that we 

have a more unified focus on the importance. I know they have a 

lot of other things to do, but this is something that should have 

been done and still needs to be done. And it is not—it is very important and it is not as hard as we all think. We have nothing to 

fear but fear itself. And in this area, if the need is there, the capacity is there, its user fee—gasoline prices have gone up and down 

by a dollar and they are constantly changing. 

If we can figure out a way to do this in a graduated fashion, I 

think that the American public, once they understand what they 

are getting for the investment, will realize that it is worth doing. 

And we all know, if you don’t invest, you are still going to pay, because you will pay with greater inefficiency and higher repair bills 

and delays and all the rest. So we might as well invest it and get 

something for that rather than frittering it away. 

Mr. OBERSTAR. A splendid statement of the case, and I thank you 

very much for that. 

All of you have made great statements. And I particularly want 

to single out the ARTBA statement, made on behalf of the ARTBA 

by Mr. Gannon. There is a map on the last page, instructive. And 

I want all of you to take note of the Committee’s documented detailed report, some 80 pages of documentation, for each of the programs go into much more than the summaries that I gave at the 

outset. 

And I want to note, while it says ‘‘Prepared for the Honorable 

James Oberstar,’’ the preparation was done by Joey Wender of our 

Committee staff, our Recovery Act guru. He has been superb, has 

followed this religiously. And a call from Mr. Wender to State 

DOTs and wastewater treatment agencies often brings fear into 

their hearts. ‘‘Oh, my God. What have we done? The Committee is 

59 

on our case.’’ But that has stimulated this openness, transparency, 

and accountability. And I thank you for your contributions today. 

Let’s all join hands and go forward from here. The Committee is 

adjourned. 

[Whereupon, at 1:50 p.m., the Committee was adjourned.] 

60 


Insert offset folio 104 here 57634.104
61 


Insert offset folio 105 here 57634.105
62 


Insert offset folio 106 here 57634.106
63 


Insert offset folio 107 here 57634.107
64 


Insert offset folio 108 here 57634.108
65 


Insert offset folio 109 here 57634.109
66 


Insert offset folio 110 here 57634.110
67 


Insert offset folio 111 here 57634.111
68 


Insert offset folio 112 here 57634.112
69 


Insert offset folio 113 here 57634.113
70 


Insert offset folio 114 here 57634.114
71 


Insert offset folio 115 here 57634.115
72 


Insert offset folio 116 here 57634.116
73 


Insert offset folio 117 here 57634.117
74 


Insert offset folio 118 here 57634.118
75 


Insert offset folio 119 here 57634.119
76 


Insert offset folio 120 here 57634.120
77 


Insert offset folio 121 here 57634.121
78 


Insert offset folio 122 here 57634.122
79 


Insert offset folio 123 here 57634.123
80 


Insert offset folio 124 here 57634.124
81 


Insert offset folio 125 here 57634.125
82 


Insert offset folio 126 here 57634.126
83 


Insert offset folio 127 here 57634.127
84 


Insert offset folio 128 here 57634.128
85 


Insert offset folio 129 here 57634.129
86 


Insert offset folio 130 here 57634.130
87 


Insert offset folio 131 here 57634.131
88 


Insert offset folio 132 here 57634.132
89 


Insert offset folio 133 here 57634.133
90 


Insert offset folio 134 here 57634.134
91 


Insert offset folio 135 here 57634.135
92 


Insert offset folio 136 here 57634.136
93 


Insert offset folio 137 here 57634.137
94 


Insert offset folio 138 here 57634.138
95 


Insert offset folio 139 here 57634.139
96 


Insert offset folio 140 here 57634.140
97 


Insert offset folio 141 here 57634.141
98 


Insert offset folio 142 here 57634.142
99 


Insert offset folio 143 here 57634.143
100 


Insert offset folio 144 here 57634.144
101 


Insert offset folio 145 here 57634.145
102 


Insert offset folio 146 here 57634.146
103 


Insert offset folio 147 here 57634.147
104 


Insert offset folio 148 here 57634.148
105 


Insert offset folio 149 here 57634.149
106 


Insert offset folio 150 here 57634.150
107 


Insert offset folio 151 here 57634.151
108 


Insert offset folio 152 here 57634.152
109 


Insert offset folio 153 here 57634.153
110 


Insert offset folio 154 here 57634.154
111 


Insert offset folio 155 here 57634.155
112 


Insert offset folio 156 here 57634.156
113 


Insert offset folio 157 here 57634.157
114 


Insert offset folio 158 here 57634.158
115 


Insert offset folio 159 here 57634.159
116 


Insert offset folio 160 here 57634.160
117 

Æ 


Insert offset folio 161 here 57634.161