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51–110 PDF 2009

THE IMPORTANCE OF A 

LONG-TERM SURFACE 

TRANSPORTATION AUTHORIZATION 

IN SUSTAINING ECONOMIC RECOVERY 

(111–50) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

HIGHWAYS AND TRANSIT 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

July 16, 2009 

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 

PARKER GRIFFITH, Alabama 

MICHAEL E. MCMAHON, New York 

THOMAS S. P. PERRIELLO, Virginia 

DINA TITUS, Nevada 

HARRY TEAGUE, New Mexico 

VACANCY 

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 

ROBERT E. LATTA, Ohio 

BRETT GUTHRIE, Kentucky 

ANH ‘‘JOSEPH’’ CAO, Louisiana 

AARON SCHOCK, Illinois 

PETE OLSON, Texas 

(II) 

SUBCOMMITTEE ON HIGHWAYS AND TRANSIT 

PETER A. DEFAZIO, Oregon, Chairman 

NICK J. RAHALL II, West Virginia 

JERROLD NADLER, New York 

BOB FILNER, California 

TIM HOLDEN, Pennsylvania 

BRIAN BAIRD, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

BRIAN HIGGINS, New York 

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 

STEVE COHEN, Tennessee 

LAURA A. RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

GENE TAYLOR, Mississippi 

LEONARD L. BOSWELL, Iowa 

RICK LARSEN, Washington 

JOHN J. HALL, New York 

STEVE KAGEN, Wisconsin 

SOLOMON P. ORTIZ, Texas 

PHIL HARE, Illinois 

JOHN A. BOCCIERI, Ohio 

MARK H. SCHAUER, Michigan 

VACANCY 

JAMES L. OBERSTAR, Minnesota 

(Ex Officio) 

JOHN J. DUNCAN, JR., Tennessee 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JERRY MORAN, Kansas 

GARY G. MILLER, California 

HENRY E. BROWN, JR., South Carolina 

TIMOTHY V. JOHNSON, Illinois 

TODD RUSSELL PLATTS, Pennsylvania 

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 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

ROBERT E. LATTA, Ohio 

AARON SCHOCK, Illinois 

(III) 

(V) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... vi 

TESTIMONY 

Braceras, Carlos, Deputy Director, Utah Department of Transportation ........... 8 

Bruffy, David A., General Manager, Mountain Line Transit Authority ............. 8 

Kienitz, Honorable Roy, Under Secretary for Policy, U.S. Department of 

Transportation, Washington, D.C. ...................................................................... 8 

Melaniphy, Michael P., Vice President, Public Sector, Motor Coach Industries, 

Inc. ......................................................................................................................... 8

Potts, Charlie, Chief Executive Officer, Heritage Construction and Materials .. 8 

Poupore, Raymond, Executive Vice President, National Construction Alliance 

II ............................................................................................................................ 8 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

DeFazio, Hon, Peter A., of Oregon ......................................................................... 37 

Mitchell, Hon. Harry E., of Arizona ....................................................................... 40 

Oberstar, Hon. James L., of Minnesota ................................................................. 41 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Braceras, Carlos ....................................................................................................... 47 

Bruffy, David A. ....................................................................................................... 53 

Kienitz, Honorable Roy ........................................................................................... 67 

Melaniphy, Michael P. ............................................................................................. 73 

Potts, Charlie ........................................................................................................... 80 

Poupore, Raymond ................................................................................................... 91 

SUBMISSIONS FOR THE RECORD 

Melaniphy, Michael P., Vice President, Public Sector, Motor Coach Industries, 

Inc., letter from William W. Millar, President of the American Public Transportation Association ........................................................................................... 14 

ADDITIONS TO THE RECORD 

American Council of Engineering Companies, Dale J. Marisco, CCTM, Executive Director, written testimony .......................................................................... 94 

Community Transportation Association, Dale J. Marisco, CCTM, Executive 

Director, written testimony ................................................................................. 96 

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(1) 

HEARING ON THE IMPORTANCE OF A LONGTERM SURFACE TRANSPORTATION AUTHORIZATION IN SUSTAINING ECONOMIC 

RECOVERY 

Thursday, July 16, 2009 

HOUSE OF REPRESENTATIVES

SUBCOMMITTEE ON HIGHWAYS AND TRANSIT, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:00 a.m., in Room 

2167, Rayburn House Office Building, the Honorable Peter A. 

DeFazio [Chairman of the Subcommittee] presiding. 

Mr. DEFAZIO. The Subcommittee will come to order. We are 

going to take testimony today on the importance of a long-term surface transportation authorization in sustaining our economic recovery. 

I believe that it would be an extraordinary mistake for this Congress to accede to the demands that popped out of the White House 

three weeks ago, asking that we should delay changes in policy 

that are long overdue and needed, changes in objectives, changes 

in the organization of the Department of Transportation, and enhanced funding for additional investment. 

And, as we all know, an 18-month delay will not be an 18-month 

delay. I guess the rationale there is we are after the next Congressional election. Well, after the next Congressional election we are 

into the Presidential election. Guess what? It is very likely to 

morph from 18 months to 42 months or probably 56 months at that 

point. So, for that reason alone I find this a very misguided proposal. 

We have put together a bill and we will note, when we hear from 

the Administration witness, that we seem to be in sync on many 

policy changes that are necessary. If, at the end of his testimony, 

he said, therefore, we support the bill, as opposed to taking a left 

turn and saying, therefore, we have to have an 18-month delay but 

would like policy changes, that would have made more sense. 

On the Senate side, Barbara Boxer, Senator Boxer has insisted 

that the 18-month delay be devoid of any policy changes, and that 

is what she reported out of her Committee. 

So we can go 18 months with the status quo, with programs that 

are in need of elimination, consolidation, a department that needs 

overhaul and streamlining, processes that lack benchmarks and accountability, that don’t account for many of the 21st century objectives we would like to have in this bill, or we can press ahead; and 

2 

it is the intention of this Committee, the full Committee Chairman, 

the Ranking Members, that we will push ahead. We recognize the 

short-term deficiency in the Trust Fund and we are in discussions 

with our leadership about how to get us to October 1st, but it is 

still our intention to go forward with a long-term authorization in 

September. 

And we can put this up there, but I am a low-tech guy. This is 

the difference. This is what we lose if we don’t pass this bill. And 

I would hope that this Administration and all the advocates out 

there, and everybody who cares about the future of this Country 

and this economy, is thinking about this. Can we afford to walk 

away from six million jobs? I don’t think so. The construction sector 

is the hardest hit sector in this Country; massive unemployment. 

And then the spillover effects. If you just take and look at the 

construction, say, of a new bus and where all the different States, 

there are about 30 States that have manufacturers that provide a 

piece of a new bus. And, of course, we have transit systems that 

are driving obsolete buses. I think there are over 20,000 that are 

past their theoretical expiration. We won’t make the increased investment to acquire those. 

We won’t make the ‘‘Made in America’’ streetcars the first ever, 

which was unveiled by the Secretary of Transportation just a few 

weeks ago in Oregon. We won’t do that. We won’t be building the 

light railcars and all the spillover jobs there. We won’t be patching 

the potholes. We won’t be rebuilding the bridges. We will still be 

detouring trucks. People will still be caught in traffic. And they will 

be told, oh, wait, in 18 months we might have a plan for you. It 

is not acceptable. 

I turn to the Ranking Member. 

Mr. DUNCAN. Well, thank you very much, Mr. Chairman. I would 

say that I certainly agree with everything you just said. Not only 

do I agree with it, I am convinced that all the Members of this 

Committee and almost all the Members of the House on both sides 

agree with what you have just said. Not only that, but over these 

last several months, the last year or so, I have met and you have 

met with people from all over this Country who have come to see 

us, telling us of some needs in their States or in their areas. 

I appreciate your calling today’s hearing. Today’s discussion will 

provide Members of the Subcommittee and others with guidance on 

which path to choose, a short-term extension or a six-year authorization bill. I expect that most of our witnesses here today firmly 

believe that a long-term authorization of the highway safety and 

transit programs will create jobs and help improve our transportation and infrastructure system. 

Our investments in infrastructure, our investments in the future 

deteriorating bridges, congested highways and insufficient freight 

movement over our Nation costs this Country. Not only does it cost 

lives, it costs money, and it costs a lot of time. We have estimates 

that congestion costs this Country $78 or $80 billion a year. The 

American Society of Civil Engineers estimates that we need to invest $2.2 trillion in our Nation’s infrastructure to remain globally, 

and even nationally, competitive. 

A short-term extension will force States to delay major transportation projects due to lack of predictable Federal funding. And we 

3 

all know that any time we delay a project, the cost of the project 

increases greatly because the cost of labor and materials increase 

over time. 

A six-year authorization bill will allow States to make plans and 

begin hiring workers for long-term projects. States will be assured 

that funding will be available for multi-year projects and construction can begin. With unemployment closing in on 10 percent—and 

most people are predicting it is going to go much higher—we cannot afford to delay construction projects. 

I might add that the big stimulus bill was sold to the Country 

on the backs of stimulus. Because so many people, such a great 

majority of the people in this Country, support infrastructure funding, it was emphasized over and over again that the stimulus bill 

was an infrastructure bill. However, only somewhere between 7 

and 8 percent of that bill was devoted to infrastructure. 

My own area, my home area of East Tennessee, for many, many 

years now, has been one of the most popular places to move to in 

the whole Country. Because of that, our economy has been very 

strong, stronger than most places in the Country. Yet even in my 

area, over the past year, we have started being hit pretty hard. In 

fact, I represent five full counties and a fourth of another county, 

so I don’t represent all that many counties. 

One of my counties has 18 percent unemployment; another county has 14.5 percent unemployment; and another county has 10.5 

percent unemployment, which is the State average for Tennessee. 

So we need the work that could be done and the boost to the economy that a six-year full authorization would provide. 

I know there were 13 amendments filed at the Subcommittee 

markup and there are several more amendments that Members 

plan to file at the full Committee. We need to work through these 

issues to ensure that this bill will move with the support of all the 

Members of the Committee. A six-year bill will provide long-term 

economic stimulus that will create jobs and get people back to 

work. I support Chairman Oberstar and Chairman DeFazio’s work 

to move a six-year authorization bill that will provide solutions to 

our Nation’s transportation challenges. 

I look forward to hearing from the witnesses and I thank all of 

you for taking time out of your very busy schedules to come and 

be here today. 

Thank you, Mr. Chairman. 

Mr. DEFAZIO. I thank the gentleman. 

With that, I turn to see if any Members on my side have opening 

statements. Mr. Larsen has an opening statement. We reward 

brevity. 

Mr. LARSEN. Well, you are going to maybe see something, Mr. 

Chairman, you haven’t seen in a long time, and that is an angry 

Norwegian, because specifically for Mr. Kienitz today, I have to say 

that, in Washington State, we were shocked and disappointed by 

the U.S. Department of Transportation’s decision that was announced Tuesday that Washington State was receiving only .012 

percent—not 12 percent or 1.2 percent, but .012 percent—of the 

$60 million in the stimulus package that was directed for ferry systems around the Country. 

4 

Although Senator Murray’s efforts on our State’s behalf have 

remedied this problem in the short-term, I am here to let you know 

that the situation still demands a full explanation of how the decision came to be made in the first place, and let me explain why 

that is. 

The Washington State ferry system serves over 23 million riders 

per year and nearly 11 million vehicles per year, which are 42 percent and 77 percent, respectively, of nationwide totals. So the 

math, frankly, doesn’t add up at all. 

DOT granted funding to several small city and county ferries 

that carry a couple thousand people across rivers and other bodies 

of water each year, including one in my own district Gwimus Island Ferry, $750,000 which represented that .012 percent of the 

$60 million total. 

Given the size of Washington State’s ferry system, and being one 

of the States most dependent upon this water-borne transportation 

element, it was a shock to us about the egregious neglect from the 

U.S. DOT. 

I should also note for the Chairman, Chairman DeFazio, that, 

unfortunately, the situation is a perfect example why I am not sure 

that we can rely on the U.S. DOT to be trusted to make the right 

decisions on some of these issues, and highlights while I and others 

are pushing to make Federal ferry dollars in the reauthorization go 

out through a formula. However, it makes me skeptical that the 

DOT can be relied upon to provide the Committee with the appropriate assistance in developing that formula. 

So, as we hear from our witnesses, and certainly from Mr. 

Kienitz today, I look forward to hearing a few answers: 

Did DOT take into account whether a State’s transportation system is dependent upon ferries? 

What criteria did DOT use to make their funding decisions? 

Is there something specific about Washington State’s projects 

that were a problem? It is my understanding that Washington 

State submitted projects that were both in economically distressed 

areas and non-economically distressed areas. 

And, finally, did this decision go through proper challenges at 

DOT before there was a sign-off? 

So, with that, Mr. Chairman, I appreciate the chance for an 

opening statement and yield back. 

Mr. DEFAZIO. I thank the gentleman. 

To the Ranking Member, Mr. Mica. 

Mr. MICA. First of all, I have to thank you, Mr. DeFazio, for convening this meeting. It is very timely; it is needed. We do need to 

look at the implications of not passing a long-term surface transportation authorization, and I think the implications are huge. 

Yesterday, I said that the action by the Senate, with an 18- 

month extension, is a prelude to economic disaster. I cannot think 

of any piece of legislation that is more important than a six-year, 

fully funded transportation infrastructure bill that would help 

jump-start the economy and provide jobs. There is nothing that is 

under consideration or will do more to put people to work. We are 

in a very serious situation and it is turning south as far as unemployment, as far as economic activity in this Country. 

5 

Let me say the problem is not going to go away, and by putting 

an 18-month Band-Aid, I think we are compounding the damage 

that will be done to the economy and the potential for any recovery 

in this Country. 

First of all, this is a betrayal of the code that we work under in 

the Congress. Mr. DeFazio will recall, Mr. Duncan will recall we 

had a Big 8 meeting with the Senate and they agreed and we all 

agreed to move forward with a bill, and that the House of Representatives would lead and Mr. Oberstar would take that lead. 

Now, I worked in a bipartisan fashion, Mr. Duncan did. There 

are some things in the bill that was passed that we didn’t particularly like, but we felt this isn’t a partisan issue, this is an issue 

that is important and vital to the Country, and we had to move forward. So we moved forward on this side of the aisle, as we said we 

were going to do, and we did it. 

I have never seen a Chairman undermined by an Administration 

in the 30 years I have been around this place like they hosed our 

Chairman. Coming out the day after we had reached agreement to 

pull the rug out from underneath him in moving forward with a 

long-term bill. 

Now, the Trust Fund is in crisis. It will go bankrupt next month. 

The problem is not going to go away. The manner in which a solution for 18 months, which would require about $20 billion, a billion 

dollars a month, to fund the Trust Fund and keep this going at a 

minimal basis is not a solution. It really will close down any longterm major infrastructure projects in the Country. 

You read some of the testimony, and your staff, Mr. Chairman, 

did a good job in putting together the impact on some of the States. 

Read what it does to Illinois. Read what it does to Indiana. We are 

closing down the major infrastructure operations and we are shortchanging State DOTs across the Country. 

So I am not very pleased about this, but I am pleased that you 

are holding a hearing that will deal with airing the consequences 

of this action. I do not intend to give up on a bill. That is the right 

thing to do. We started it in a bipartisan manner and I hope Members will support the Chairman and the effort to get people working to get infrastructure being built in this Country and moving a 

long-term solution to the crises transportation faces in our Nation. 

Thank you. I yield back the balance. 

Mr. DEFAZIO. I thank the gentleman. 

I am going to recognize other Members for opening statements, 

but I will just remind Members we do have a panel. We have a 

whole pile of votes coming up in the not too distant future, so I 

would urge Members to be brief if they need to speak. 

With that, I turn to Mr. Baird. 

Mr. BAIRD. Mr. Chairman, in the interest of brevity, you are 

right, the Ranking Member is right, and Mr. Larsen is right. I 

yield back. 

Mr. DEFAZIO. Wow. All right. That has got to get you another 

ferry at least. 

[Laughter.] 

Mr. DEFAZIO. Mr. Coble. 

Mr. COBLE. Mr. Chairman, I will be equally brief. I want to 

thank our witnesses for being here. I have two other hearings, so 

6 

I am going to have to come and go, but I want to associate with 

the comments you made, the gentleman from Tennessee, and the 

Ranking Member from Florida. You are on the money and I concur. 

I yield back. 

Mr. DEFAZIO. I thank the gentleman. 

Mr. Carnahan. 

Mr. CARNAHAN. Thank you, Mr. Chairman. In the interest of 

brevity also, I cannot believe the shortsightedness of our colleagues 

across the Hill in doing something as silly as they did yesterday 

in terms of our Nation’s infrastructure and certainly our transportation, and I encourage every Member of this Committee to walk 

in lockstep to make sure that this doesn’t stand and we can push 

a bill through rapidly. Thank you. 

Mr. DEFAZIO. I thank the gentleman. 

Others? Mr. Diaz-Balart? 

Mr. DIAZ-BALART. Thank you, Mr. Chairman. I think there is a 

consensus here about the extension, about the fact that the one 

thing that we can do to really help this economy is get a bill out 

of here as soon as possible. 

Look, even though some may not want to publicly admit it yet, 

even though it is becoming more and more evident, the stimulus 

didn’t work. We were promised 8 percent unemployment; we are 

way beyond that. We were promised 3.5 million jobs created; we 

lost 2 million jobs since the bill has passed. 

I have a bill that is not the answer, but it is an option that would 

get the unencumbered stimulus money and put it into the DOT 

Trust Fund to actually create jobs and start building projects. 

So, again, I think there is a consensus that, if there is one area 

that we know creates jobs, puts people to work, helps our economy 

short-term and long-term, it is transportation. So I concur with 

what has been said about we should be moving forward and not 

finding excuses to delay the process. 

Thank you, Mr. Chairman. 

Mr. DEFAZIO. I thank the gentleman. 

Mr. Arcuri. 

Mr. ARCURI. Thank you, Mr. Chairman. I will be brief. 

Too much is at stake for us to simply pass our responsibility by 

opting for a mere extension of the current law. We owe it to our 

constituents, the American people, to do work in a timely manner 

so as not to cause further economic disruptions. There has been 

talk here in Washington and around the Country about whether 

there is a need for a second stimulus or further action to stimulate 

the economy. The only additional action that is needed is for us to 

do that which we are supposed to already do. We must pass a longterm surface transportation authorization act; we must do it before 

September. 

Thank you, and I yield back the balance of my time. 

Mr. DEFAZIO. I thank the gentleman. 

Mrs. Napolitano. 

Mrs. NAPOLITANO. Thank you, Mr. Chair. I also congratulate you 

and Ranking Member Duncan, but also Mr. Oberstar and Mr. 

Mica. I associate myself with the remarks of my Chairs and Ranking Members, especially of the full Committee. 

7 

I strongly support, vehemently support passing the surface transportation bill. Lots of California jobs, jobs, jobs that are ready to 

go, and with the Trust Fund being on the brink of bankruptcy, we 

need to move, and we hope that everybody impresses upon our Administration the need to ensure that this does pass. 

Yield back. 

Mr. DEFAZIO. With that, okay. 

Oh, the Chairman. Excuse me. He came in so quietly and demurely, and he has no strong feelings about this, so he probably 

doesn’t want to do an opening statement. 

[Laughter.] 

Mr. OBERSTAR. No, Mr. Chairman, thank you. 

Mr. DEFAZIO. I would recognize the Chairman. 

Mr. OBERSTAR. It is awfully good. It has been a good day. I got 

a good night’s rest, I slept well, I went out and got a 10 mile bike 

ride this morning, read all the witness statements, and glad to 

have all of you. 

Mr. DEFAZIO. While you were riding? 

Mr. OBERSTAR. No, after I rode the bike. No, you can’t do that 

on the road; that is dangerous. That is worse than using a BlackBerry while you are driving a car. 

Mr. Kienitz, you said all the right things. I read your entire 

statement. It was really good; well prepared; good thought out. But 

you came to the wrong conclusions. It is just too bad. 

You know what I think this Administration needs—and every administration—in addition to or maybe in place of the Council of 

Economic Advisors is a council of engineering consultants. And 

probably Mr. Potts would agree with that, and a few others. 

While the President, Mr. Obama, as Senator, was campaigning 

for President, we weren’t sitting on a stool somewhere; we were 

holding hearings in this Committee room over two years, in-depth 

hearings to understand the needs, the problems, the shortfalls, the 

fixes that are necessary for the future of transportation. We fashioned them into a bill. We don’t need an 18-month learning curve, 

I have news for the Administration. 

You are a seasoned professional; you know better. We are not 

going to wait 18 months. And as other Members of the Committee 

have said, and as witnesses will testify this morning, we need to 

move ahead now. Inertia is the enemy of progress, and we don’t 

have time to wait. The economy doesn’t have—people who are 

spending 40 to 100 hours a year in traffic, goods that are wasting 

time en route to their destination, companies that are spending 

millions and millions of dollars in overtime charges and late delivery fees can’t wait 18 months for this crowd to make up its mind. 

We made up our mind; we have a bipartisan bill. We need some 

refinements to it; we are continuing to do that. We will figure out 

a way to finance it. We just need your partnership. We need the 

partnership of all those at this table. We are going to move ahead; 

we are not going to wait 18 months. 

Thank you. 

Mr. DEFAZIO. Thank you, Mr. Chairman. 

With that, we will turn to our panel. We have, first, the Honorable Roy Kienitz, Under Secretary for Policy. 

8 

Mr. Kienitz, as I believe you have all been informed, the Chairman has already told you he has read your testimony, and you can 

bet on it. He can quote it back to you in several languages. And 

I have read your testimony and highlighted it, and I am sure other 

Members have too. So what we ask you to do—because it gets really boring listening to people read—is summarize your most cogent 

and best points that you want to make that were either in your testimony, or respond to something you have heard here. You have 

two minutes, and then we will go on to questions. 

So, with that, Mr. Kienitz. 

TESTIMONY OF THE HONORABLE ROY KIENITZ, UNDER SECRETARY FOR POLICY, U.S. DEPARTMENT OF TRANSPORTATION, WASHINGTON, D.C.; CARLOS BRACERAS, DEPUTY DIRECTOR, UTAH DEPARTMENT OF TRANSPORTATION; DAVID 

A. BRUFFY, GENERAL MANAGER, MOUNTAIN LINE TRANSIT 

AUTHORITY; CHARLIE POTTS, CHIEF EXECUTIVE OFFICER, 

HERITAGE CONSTRUCTION AND MATERIALS; RAYMOND 

POUPORE, EXECUTIVE VICE PRESIDENT, NATIONAL CONSTRUCTION ALLIANCE II; AND MICHAEL P. MELANIPHY, 

VICE PRESIDENT, PUBLIC SECTOR, MOTOR COACH INDUSTRIES, INC. 

Mr. KIENITZ. Yes, sir. I will do my best. 

Thank you, sir, and Members of the Committee for having us 

here. I have four basic points that I would like to make, which I 

think Mr. Oberstar probably summarized, actually, better than I 

will, so I will be very brief, the first of which is there is no disagreement from us about the long-term economic benefits of transportation and infrastructure investment; that is an obvious known 

and important thing. So that puts us in a position where I think 

our goals are very similar. 

Second, the best way to assure the greatest long-term benefits for 

the Country are through a long-term reauthorization of Federal 

transportation programs. I think we all understand why that is the 

case; it creates predictability. And, in particular, at this moment, 

given who the Chairs of this Committee are and the mood of the 

community, I think, there is a huge opportunity for major reform 

in a way that we haven’t seen for a long time, and I know these 

two gentleman are certainly the biggest supporters of that around 

here. So we see that as a huge opportunity. 

Third, unfortunately, is the paid for issue, and I think that has 

been the biggest stumbling block. In past years, the struggle over 

this program, as the Members here have lived through, has been 

there is money in the Trust Fund; can we spend the money in the 

Trust Fund? Or taxes were dedicated to this program but have 

ended up going elsewhere. So there have been various Herculean 

efforts by Members of this Committee to assure that the taxes that 

appropriately should go for transportation do to go the Trust Fund 

and once in the Trust Fund they don’t sit there with a very large 

balance while projects need to be funded but the monies provided 

are spent contemporaneously. 

This, I fear, is a case of a different order, where the shortfall between the funding levels that have been proposed here and the revenue levels that exist are quite large, as Mr. DeFazio’s chart pointVerDate Aug 31 2005 12:27 Oct 20, 2009 Jkt 000000 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 P:\DOCS\51110 JASON
9 

ed out. So I think that is the principal thing that has led the Administration to propose an 18-month extension with, frankly, General Fund dollars hopefully paid for through matters that the Finance and Ways and Means Committees will work out to prevent 

a fall in funding in this interim period while principally the tax or 

revenue issues are worked out, but also then the details of the reauthorization are worked out as well. 

So I am 15 seconds short and I will stop. 

Mr. DEFAZIO. Thank you. 

Mr. Carlos Braceras, Deputy Director, Utah Department of 

Transportation. 

Mr. BRACERAS. Thank you, Mr. Chairman, Members of the Committee. It is a pleasure to be here today, and I will keep my remarks short. 

There has been quite a bit of discussion about the critical nature 

transportation plays in the Nation’s infrastructure and also in our 

economy, and I won’t belabor that point. We at AASHTO believe 

that we need to increase the investments at all levels of government for transportation because of the critical role that transportation plays in the lives of the American people. 

But the second point I would like to make is the very important 

point that AASHTO believes that we need to have a predictable, 

well-funded, multi-year authorization measure that reinforces the 

existing Federal-State partnership. To get transportation projects 

that represent a collaborative solution to transportation challenges, 

it takes time to do that, and we need to have that predictable funding source in order to be able to work with all partners at the local, 

State, and Federal level in order to come up with those appropriate 

solutions for that. 

AASHTO has called for an authorization bill with substantial reforms, many of which were also proposed in Chairman James Oberstar’s bill. Nevertheless, we do have some concerns with some of 

the details, and we recognize that we are at the beginning of the 

process and look forward to working with the Members of this 

Committee to help resolve some of the concerns that our member 

States have. But simply put, a well-funded six-year authorizing bill 

that respects that essential role of the States in administering and 

delivering the surface transportation program is critical for your 

State DOTs and for the governors. 

The short-term funding crisis is the element that—first of all, let 

me appreciate the work that is going on right now to help resolve 

this, but this is something that does keep me awake at night. We 

have contracts going right now, and we only have two weeks left 

to solve this issue. It is critical that Congress transfer an additional $8 billion from the General Fund to help get us through this 

fiscal year so that we can have surety in being able to pay those 

contractors that are working today out on our projects. 

Funding should also be provided to assure that there is no interruption in the 2010 highway program, which begins in October of 

this year. It is our estimation that an additional $10 to $12 billion 

will be needed to be transferred into the Highway Trust Fund in 

order to ensure solvency through the end of fiscal year 2010. 

10 

Mr. Chairman, we urge Congress to increase the Trust Fund resources so the Trust Fund can meet the short-and long-term investment needs of our Nation. Thank you. 

Mr. DEFAZIO. I thank the gentleman. 

With that, we turn to Mr. David A. Bruffy, General Manager, 

Mountain Line Transit Authority, Morgantown, West Virginia. 

Mr. BRUFFY. Mr. Chairman, Mr. Chairman, and Members of the 

Committee, thank you very much for the opportunity to offer testimony today. I would like to take a couple of minutes to highlight 

some of the more significant local impacts of your Committee’s efforts and to answer any questions you might have. 

I have three primary points that I want to share with you and 

emphasize. This is a tenuous time for transit. It is imperative we 

have a new funding bill. We need a new national vision for surface 

mobility, and we can’t wait any longer. 

This is a tenuous time for transit, a transit paradox, if you will, 

when fuel costs, insurance, utilities are all on the rise; local funding sources are being reduced, even in one of the strongest local 

economies in the Country, in Morgantown, West Virginia. West 

Virginia University has cut their funding by 16 percent this year. 

Another local funding source eliminated $100,000 in support that 

provided 95,000 passenger rides last year. At the same time, Mountain Line’s ridership is up 41 percent year to date. 

This is a tenuous time for transit and I need your support so that 

we can plan the way forward for my service and for my community. Secondly, a new investment bill is imperative. With $950,000 in 

recovery money, my system bought three heavy-duty buses manufactured in California, with fare boxes built in Illinois, with seats 

manufactured in Michigan. They come from all over the Country. 

We need two new buses a year, at $700,000, to sustain our current 

services. Recovery investment is but a beginning; it needs to continue. 

Thirdly, we need a new vision for surface mobility. More than 40 

percent of my buses are past their useful life. I get retired buses 

from other systems to expand service. I run light-duty buses with 

280,000 miles on them and they are twice their intended life span. 

In the last six years, Mountain Line’s FTA investments increased 

33 percent, from about $400,000 to about $700,000. 

Yet, our ridership has increased 194 percent, from 400,000 rides 

to 1.1 million rides. We serve seniors, rural areas, college students. 

We even go to Pittsburgh with intercity bus service. Currently, 

there is very little relationship between success and investment. 

We need a new vision that will enable people a meaningful alternative to the personal auto, and we can’t wait any longer. 

Mr. Chairman and Members of the Committee, I respectfully request you submit my written comments into the record, and I look 

forward to your questions. 

Mr. DEFAZIO. Thank you. 

With that, we are going to turn to Mr. Charlie Potts, Chief Executive Officer, Heritage Construction and Materials, Indianapolis, 

Indiana. 

Mr. POTTS. Mr. Chairman, Members of the Committee, good 

morning. I am here today as the Chairman of the American Road 

and Transportation Builders Association. I have spent over 40 

11 

years in transportation development, both as an executive of the 

Florida Department of Transportation and as a CEO of two national construction and materials firms, and I would like to begin 

by saying that we are appalled by recent calls for and actions to 

postpone the enactment of a new surface transportation program 

investment bill until at least March of 2011. 

I assure you the only people who might possibly see any benefit 

from such delay are right here in Washington, D.C. They are certainly not in the real world that I have worked in for four decades. 

In the real world, that delay means companies like mine will not 

be hiring people and will not be making the expensive capital investments in materials and equipment, because, quite frankly, 

there is no prospect that the market is going to turn around anytime soon without that investment. And make no mistake, the evidence shows the transportation construction market in this Country is constricting in many States at a very critical time. 

We are not expanding to help lead the economic recovery by creating jobs that this Nation desperately needs. We learned the hard 

way, from 2001 to 2005, that the uncertainty at the Federal level 

at a time of economic and State budget difficulty leads to an overall 

stagnation of national effort to delivery surface transportation improvements. 

Mr. Chairman, we commend you and your Committee for doing 

its job and leading in this effort. We encourage the Committee to 

continue pushing forward to enact a bill this year. And I want to 

thank you for this opportunity to participate in this dialogue with 

you and other Members of the Committee. 

Mr. DEFAZIO. I thank the gentleman for a very cogent and effective statement. 

Mr. Raymond Poupore, Executive Vice President, National Construction Alliance II. 

Mr. POUPORE. Thank you, Chairman DeFazio, Ranking Member 

Duncan, and distinguished Members of the Highways and Transit 

Subcommittee. On behalf of the National Construction Alliance, 

better known as NCA II, partnership between two of the Nation’s 

leading construction unions, the Operating Engineers and the Carpenters, want to express our appreciation for the opportunity to 

join you today. 

The two unions and the Alliance represent nearly one million 

workers, the same workers who build the Nation’s surface transportation system. My message today is simple and straightforward: 

the NCA II respectfully requests that Congress move forward with 

the reauthorization of the Nation’s surface transportation law as 

soon as possible. 

The Administration’s proposal to extend existing legal authority 

for 18 months is unacceptable. An 18-month extension in practice 

indefinitely postpones reauthorizing the law, ensuring that substantive work developing this legislation is pushed into the 112th 

Congress. 

Chairman DeFazio, the NCA II seeks to make three main points: 

first, early signs of progress from the Recovery Act will quickly be 

dashed without long-range commitment to infrastructure; second, 

the uncertainty of an 18-month extension undermines the longrange planning of major transportation projects; and, third, there 

12 

is no logical connection between the problems in the Highway 

Trust Fund and an 18-month extension of the Nation’s surface 

transportation law. Indeed, both problems call for a solution. 

The NCA II fears that the short-term injection of resources into 

the Nation’s transportation system from the passage of the American Recovery and Reinvestment Act will not have the intended result unless a longer range commitment to infrastructure spending 

through a timely reauthorization of the Nation’s transportation law 

is passed by the 111th Congress and signed into law by President 

Obama. 

The good news, in a small subsector of streets and highways and 

bridges, we have picked up 60,000 jobs in the last two months. We 

can’t afford to lose momentum on your efforts or on the investments contained in the Recovery Act. The policy issues are known: 

project delivery, infrastructure banks, public-private partnerships, 

and livability. The process is moving, the train is moving. The Administration needs to jump on board and engage Congress. 

The NCA II strongly urges the Subcommittee to continue the effort to pass the surface transportation authorization as soon as possible, to reject the Administration’s 18-month proposed extension, 

and separately to fix the hole in the Highway Trust Fund. Mr. 

Chairman, America urgently needs a robust transportation bill 

along the lines of what you passed on May 24th. 

Thank you so much. We appreciate your leadership. My members 

thank you. Through your actions, you put them to work and you 

help them sustain their families. You are the most important Committee here in Washington. We thank you. 

Mr. OBERSTAR. Amen. 

Mr. DEFAZIO. We now turn to the last member of the panel, Mr. 

Michael Melaniphy, Vice President, Public Sector, Motor Coach Industries, Inc. 

Mr. MELANIPHY. Chairman DeFazio, Ranking Member Duncan, 

Chairman Oberstar, Members of the Subcommittee, thank you for 

the opportunity to present testimony this morning. I am honored 

to have an opportunity on behalf of Motor Coach Industries and the 

American Public Transportation Association. 

Mr. Chairman, the numerous and varied benefits of investment 

in public transportation, including the personal mobility, congestion relief, environmental and quality of life benefits that this critical investment brings are referenced in my written testimony. 

However, today, your focus is on the economic imperative of passing the surface transportation bill, and rightfully so. This next authorization bill is imperative for the jobs and economic opportunities it will create for companies such as mine and many others 

throughout the industry. 

This is an industry with a long and extended supplier base. Any 

investment that the surface transportation authorization act will 

provide will have an immense impact on jobs and our economy immediately and for many years to come. As we work our way out 

of this economic downturn, this bill provides us with one of the best 

vehicles for advancing economic opportunity. 

Mr. Chairman, I have two graphics I would like to show the Subcommittee up on the screen. The first is a diorama of a transit bus, 

and it shows where we source our parts to build those buses from 

13 

throughout this Country. Big communities, small communities, 

communities at risk, where we get parts for buses. I have a similar 

slide for railcars. Investing in equipment across the Country yields 

jobs throughout our Nation. We benefit from those throughout the 

Country, including little places like Pembina, North Dakota, where 

there are only 700 residents, and we employ over 300 people in 

that community alone building buses for this Nation. 

Our suppliers must wait for orders to come from us, the OEMs. 

The MCI factories alone are supplied by more than 3,000 suppliers. 

If we look at the aftermarket support for our product, there are 

10,000 suppliers supporting the bus industry. 

Mr. Chairman, jobs are at stake. The opportunity is around the 

corner and I commend the Committee on its dedication to completing a strong authorization bill, and my colleagues and I stand 

ready to work with you to ensure its passage. 

Mr. Chairman, I would also like to offer for the record a letter 

from APTA’s President, Bill Millar, in support of passage of the authorization bill. Thank you. 

[Information follows:] 

14 


Insert offset folio 8 here 51110.008
15 

Mr. DEFAZIO. I thank the gentleman and thank all the members 

of the panel for being here and for summarizing their remarks. 

With that, we will proceed to questions. 

Mr. Kienitz, you said in your testimony that we need a more 

flexible funding system. Now, Secretary LaHood was attacked for 

proposing the possibility of a vehicle mileage tax. Secretary LaHood 

has said that the Administration is opposed to a gas tax. I have 

proposed taxing oil by the barrel, with the idea that some of that 

tax could flow upstream to the OPEC cartel, the oil speculators, 

Exxon-Mobil could lose a little of their obscene profits. 

And then, most recently, I have proposed the idea of just taxing 

oil speculators. Not hedgers, not trucking companies, not airlines, 

not railroads, not steamship companies; just financial speculators. 

One-tenth of 1 percent raises $40 billion a year, and that is if we 

assume we drive down the price of oil dramatically because they 

all get out of the market like they said they would. That would be 

a good thing, I think. 

I proposed the idea of bonding by putting a construction cost inflation on the gas tax and delaying that until such a time as the 

economy recovers. So two years from today you might see a penny 

on the gas tax. But I figure that could put $60 billion up front into 

the Trust Fund, which is broken. 

How much more flexible can you get? Give me another idea? Oh, 

we also have the infrastructure bank, which will work for some 

projects which provide revenue. It obviously won’t work for transit, 

since all transit systems in the world lose money. So we have got 

it in there. What more flexibility do you want? Got any other ideas? 

Give me one. 

Mr. KIENITZ. Thank you, sir. 

Mr. DEFAZIO. Or is that just a code word for we don’t want to 

address revenues and increase investment in the Trust Fund until 

after 18 months? And I don’t know how it is going to be any easier 

in 18 months, when the President is up for re-election, than it is 

today, when all of us are up for re-election. 

Mr. KIENITZ. Let me make a few points, the first of which is I 

know that you have transmitted your proposal regarding the small 

tax on futures, quarter percent or whatever the number is, and 

that has been sent by you directly to the White House and the 

President’s economic team, and I have talked to them about it, and 

they are analyzing it and the Treasury Department is analyzing it. 

I know that one of the questions being analyzed is the degree to 

which it would change the behavior of people who trade in those 

contracts in one way, at least, which is by moving those trades offshore. 

Mr. DEFAZIO. Well, remember, the provision would be that any 

entity or individual engaged in this trading domiciled in the United 

States of America would have to pay the tax. So you could start 

trading in Bahrain, but unless you want to move to Bahrain, you 

are going to pay the tax. 

Mr. KIENITZ. I definitely don’t want to move to Bahrain. 

Mr. DEFAZIO. Okay. But what I am saying is there are ways to 

do this. There is a long reach. Plus, if you might have noticed, 

there is also interest in the European Union on doing away with 

speculation in these markets. They seem to be a lot more serious 

16 

about it than we are. So if you add up the EU and the United 

States, there are not a whole heck of a lot of places to go. 

Mr. KIENITZ. And so, on that point, I know that that idea is being 

looked at seriously. I will make sure that this question of domicile 

is being properly factored into whatever analysis is done. 

As to our suggestions for long-term revenue, I think that is a 

place where the Administration is sort of not quite ready to make 

a particular proposal yet, and that is, I think, part of the motivation behind the proposed extension. 

Mr. DEFAZIO. Right. So we are going to put off a difficult decision 

for 18 months, hoping that somehow, miraculously, it won’t be a 

difficult decision in 18 months. My State enacted a gas tax increase. We have the highest unemployment in America. The New 

York Times says our unemployment rate in the State of Oregon, 

when you factor in underemployed and exhausted benefits, is 23 

percent, and we have well over 30 percent unemployment in our 

construction sector. 

Now, I think people in Oregon would be happy to pay a tiny bit 

more at the pump, instead of giving it to Exxon-Mobil, to see that 

we put more people back to work, and I think people all across 

America would like to see that kind of investment. So I think that 

the Administration is being unnecessarily averse in underestimating the capability of the American public understanding 

that when they put a little bit of money into transportation infrastructure, they get a better transportation system and we get jobs, 

real jobs. That, I think, is just where the Administration needs to 

rethink the strategy. 

But let’s get to the other point. I agree with Chairman Oberstar. 

I read all the way through your testimony and I said this is really 

good, this is great, he is making good points. Then I came to the 

same point he did, which is well, now we have come to the wrong 

conclusion, which seems to have been appended on by someone 

other than whoever wrote the testimony; perhaps someone from the 

economic team, I don’t know. 

So I guess my question is if you are confronted with what Senator Boxer has proposed, which is 18 months, no change in policy, 

you are stuck with the crippling and decrepit policies of the past, 

no reorganization, none of the other things that are in our bill, 

where are you going to come down here? Are you going to deal with 

us or are you going to deal with them? Because us, we want longer 

term; they, they just want status quo 100 percent, that is, we not 

only forego a million jobs a year, we forego any meaningful changes 

in policy to deliver projects more quickly and with less expense. 

Mr. KIENITZ. What I think I can say about that is that we were 

appreciative of the action that Ms. Boxer’s Committee took yesterday to move forward one step in the 18-month extension. Obviously, our proposal also includes some reform elements there, 

which we have talked to you all about in broad concepts and about 

which we hope to speak more in greater depth—— 

Mr. DEFAZIO. But most of those concepts would be under the jurisdiction of EPW and not the subsequent referrals in the Senate. 

So it doesn’t look like you are on track to getting what you want 

out of the United States Senate. You would get 18 months status 

17 

quo. Is that acceptable to this Administration, 18 months with no 

change in policy? Is that acceptable? 

Mr. KIENITZ. I don’t think it is my place to try to make policy 

on that. 

Mr. DEFAZIO. We are not making policy, just asking if it is acceptable or not. 

Mr. KIENITZ. How about this? I don’t think it is my place to state 

an Administration policy on that point. 

Mr. DEFAZIO. Okay. Who states Administration policy on these 

things, Larry Summers? Axelrod? Who is it? 

Mr. KIENITZ. I am coming to learn that that is a bit complicated. 

Mr. DEFAZIO. Okay. 

[Laughter.] 

Mr. DEFAZIO. Mr. Potts, I think it was—no, it was Mr. Poupore, 

excuse me. You mentioned the fact—and this is just a key point 

with me—if we do 18 months, how many 24-, 36-, 48-, or 60-month 

projects will be planned with an 18-month extension and begin construction? 

Mr. POUPORE. I would probably say zero. Looking at the last reauthorizations that we have had, when you went with the 6-month 

extension and 12-month extension, from my point of view in dealing with the contractors that do heavy and highway work throughout the Country, it is real lag by the time you actually put a bill 

in place and we actually get construction going. I mean, we are seeing that in the Recovery Act right now. 

My point is we are just starting; it is just starting to kick in, we 

are just starting to get some traction on that job creation. But this 

delay here and this business as usual is really unfortunate. I am 

very disappointed in the Administration’s position and disappointed in what the Senate did yesterday. And I applaud you 

and your Committee here for trying to put America back to work. 

Mr. DEFAZIO. Is there anybody on the panel who thinks that 

States or transit districts would undertake very large scale, multiyear projects under an 18-month extension? 

[No response.] 

Mr. DEFAZIO. Okay. And then, for Mr. Kienitz, could the Department of Transportation do a full funding grant agreement on a 

large transit project that was going to take, say, five years? Do you 

think you have enough contingent contract authority under current 

funding levels? Our staff analysis says no. Basically, we are going 

to forego those things under this 18-month extension. 

Mr. KIENITZ. That is actually a pertinent question that we have 

spent some time looking at and has come into play, frankly, with 

a very large project in the New Jersey-New York area, where basically everything is apparently ready to go and we haven’t been able 

to sign a full funding grant agreement because, as you understand, 

of the way the commitment authority rolls forward without a longterm authorization. That project is still on track to proceed as 

quickly as it can from an engineering point of view because of a 

smaller agreement we worked out with them. 

Mr. DEFAZIO. But if we do an 18-month with no policy changes, 

it is going to kind of grind to a halt, right? 

18 

Mr. KIENITZ. As long as you go at least a year, that will give us 

an additional year of commitment authority and will allow a number of projects to move forward. 

I will say, from the State side—— 

Mr. DEFAZIO. To the exclusion of every other project in America 

at that point? Because our staff analysis is there is just not a lot 

out there, unless you get the new funding levels we are proposing 

and the new flexibilities we are proposing for transit within the 

congested urban areas. 

Mr. KIENITZ. On the larger level I would agree with that, which 

is the problem with the New Starts program, one of the problems 

with the New Starts program is that it has become something for 

which demand wildly outpaces our ability to fund. So I think one 

of our priorities in any reauthorization will be to try to rectify that 

imbalance and create much more of an ability to fund many 

projects. 

Mr. DEFAZIO. Right. And we will have staff follow up with your 

staff, but you are thinking we can squeeze in this one major project 

with a year extension, but basically that would be it for transit; the 

rest of America would wait for 18 months or 12 months or whatever. 

Mr. KIENITZ. No formal plan has been worked out as to whether 

that would be the resolution. There are other competing projects as 

well. 

Mr. DEFAZIO. It would be popular with Mr. Nadler and a few 

others, but not probably to many others up here at the dais. 

Mr. KIENITZ. Correct. 

Mr. DEFAZIO. Thank you. I thank you. My time has expired. 

Mr. Duncan. 

Mr. DUNCAN. Well, thank you very much, Mr. Chairman. I won’t 

have to ask many questions because I agree with almost everything 

that the witnesses have said here today, but I will say this. Our 

founding fathers instituted two-year terms for the Members of the 

House. We have to run every other year, and they did that on purpose because they felt that would put more pressure on the Members of the House to stay very close to the people. 

I think even they would be amazed at how accurate that prediction has become. Because of our good transportation system, 

most Members of the House go home just about every weekend; 

they probably spend almost as much or more time in their districts 

than they do here in Washington. 

So I think that almost all of us in the House really know, on a 

close, first-hand basis, the needs of our communities. So because of 

that, there is a tremendous desire, I think, on the part of almost 

all the Members of the House on both sides of the aisle to have a 

strong infrastructure bill, strong highway bill out, and have it out 

this year, without much delay. 

In fact, I think when we started this Congress, I think there was 

a desire to try to avoid in every way possible the 20-month delay 

that we had on the last highway bill. This is my fourth highway 

bill. I was here for ISTEA in 1991 and TEA-21 in 1998, SAFETEALU in 2005, and all of those bills have received overwhelming support on both sides of the aisle. 

19 

One of several reasons, but one of the very most important reasons that I have always enjoyed my service on this Committee and 

have always treated this Committee as my main Committee out of 

the three on which I serve is because of the bipartisan or non-partisan nature of this Committee. And I think most Members know 

that I very seldom say anything partisan. 

I will say, though, that I think it is accurate to say that almost 

everybody on our side of the aisle, both on this Committee and in 

the full House, feel that the cap and trade bill and the health bill, 

that if the Congress passes both of those bills, that those bills, because of their tax increases and other costs that those bills will destroy jobs; and that those are the kind of bills that maybe we could 

pass in boon times, but not in times such as we face today. 

But the opposite of that is this bill, the highway bill, because I 

don’t think anybody in the House can think of another big bill that 

would do more to help the economy and create jobs and do things 

for the people in this Country. I have mentioned many times in 

hearings in this Committee that I think it is very unfortunate that 

we have spent so many megabillions rebuilding Iraq and Afghanistan, and even other places around the world, and then we have 

so much trouble getting through legislation like this that is so 

needed in this Country. 

Now, let me just ask a couple of questions. Mr. Kienitz, you said 

in your testimony that if we did just the simple straight, clean extension that some people are talking about and that you advocate, 

that we still could do some targeted reforms. What targeted reforms do you mean? 

Mr. KIENITZ. There are three areas in which we have made suggestions. Although I might say these are suggestions and we are 

open to other suggestions. The first would be an expanded effort by 

U.S. DOT, States, and regional planning agencies to do data collection and build up analytical resources in this intervening period so 

that, if and when we can get a major reauthorization, potentially 

with a significantly larger amount of funding, that the systems by 

which we are determining whether we are designing projects as 

good as they can be designed and selecting the best projects that 

generate the most benefits for folks locally and in response to the 

national need are as robust as they can be. So there is a bunch of 

complexity that can be behind that, but that is the basic idea. 

The second of which is certainly since the ISTEA bill in 1991, 

there has been an increased focus on sort of metropolitan areas 

through the MPO planning process, and I think that certainly in 

the bill the gentlemen have introduced there is an even greater 

focus on there. So we want to undertake some cooperative work 

with those folks to make sure that their capacity to really ramp up 

and deal with the very difficult and complicated multi-modal transportation challenges in our larger metropolitan areas is as strong 

as it could be, so there would be some funding associated with that. 

The third is something I think you have heard the Secretary 

speak about, which is a local communities program. He believes 

that really can be a great thing going forward and that the Federal 

Government can be much more of a leader in that area, rather 

than sort of following local initiatives, which is a lot of what has 

happened until now; and that is bicycle and pedestrian infrastrucVerDate Aug 31 2005 12:27 Oct 20, 2009 Jkt 000000 PO 00000 Frm 00031 Fmt 6602 Sfmt 6602 P:\DOCS\51110 JASON
20 

ture linked in with transit and transit-oriented development. There 

are a bunch of pieces to that, so we think there is a great opportunity to get started on that, once again, to build towards an eventual reauthorization. 

Mr. DUNCAN. All right, thank you very much. 

Mr. Potts and Mr. Melaniphy, you are here as representatives for 

various companies around the Country. Would both of you tell me, 

if you can, a little bit more about your specific companies and how 

many people you employ now, what was the most ever number of 

people you employed, and how much difference you think it would 

mean for your specific companies to do just the temporary extension, as opposed to doing a strong, solid, approximately $500 billion 

bill? Mr. Potts? 

Mr. POTTS. Well, first of all, we have, for the first time in about 

over 10 years, made reductions in our workforce because of lack of 

work, and we have actually shut down some of our aggregate operations because there is just no volume. But we are not the only 

ones that have done that. I was talking to the chairman of the 

board of Aztec Industries in your State yesterday, and he told me 

that, because of lack of orders, they have had to reduce their workforce by 25 percent. So it is not only our business, but all of the 

allied businesses that go along with it. 

In the last year the transportation construction industry has lost 

37,000 jobs across the Country, and one of the bigger problems that 

I don’t think people recognize in our business are the spikes up and 

down, and how it affects us in keeping our workforce in place. It 

is hard to attract new people into this industry when they don’t 

have assurance of the stability of the jobs, supporting their families. The one thing that I think we don’t see is that now our workforce is aging, our skilled workers, and trying to attract new people 

into the business is hard when they see two years it is great, feast 

and famine. 

As we see it, or as I see it personally, I think most of this, all 

we hear in the rhetoric is justifying the urge to procrastinate, although there are some people, in and out of government, who want 

a reauthorization delay to better advance their own policy agenda. 

But this, I think, is appalling when you look at the 37,000 jobs that 

have been lost in the last year. Unfortunately, along with it, the 

back and forth rhetoric is an exercise that is overshadowing the 

simple fact, and you pointed out a couple of the things: there are 

22,000 fatalities every year that could be avoided if we corrected 

some of the road problems that we have; traffic congestion is causing us a problem; and the other fact is that it has affected our competitiveness in the global economy. 

I have lobbied and worked with Chairman Oberstar and his staff 

for at least the last six or seven years directly because I thought 

we needed a new vision and a new direction for this program. The 

House came forward with what I think is a robust, reform-oriented, 

multi-year program that would stabilize this industry, stabilize our 

direction, and, quite frankly, I think it is time to get on with it and 

do what you all brought to the table. Thank you. 

Mr. DUNCAN. Thank you very much. 

Mr. Melaniphy? 

21 

Mr. MELANIPHY. Michael Melaniphy, Motor Coach Industries. We 

are the largest manufacturer of motor coaches in North America. 

We have been in place for 76 years. We employ about 2,000 employees, not just in Pembina, North Dakota, but in places like Lebanon, Tennessee, and Loudonville, Ohio where we have facilities. 

In Loudonville, we have 70 employees there; a major employer in 

that community. 

We recently came out of Chapter 11 restructuring. I can speak 

with great authority to the challenges of access to financing and 

the impact on jobs. Our company is split fairly equally between the 

private sector, tour charter companies, and line haul operators, and 

the public sector for transit agencies across this Country. Were it 

not for the investment in the public sector in transit right now, we 

would have significant layoffs. ARRA has made a significant impact 

on keeping jobs in our location. 

And as we look going forward, you have to understand that bus 

manufacturers typically run 12 to 18 months out from when an 

order comes in until we build a bus. So if we are talking about an 

18-month delay, that is where we are already at with production 

schedules. Railcars are two to four years out. 

So if you look at investments in new products, new innovation, 

hybrids, alternative fuels, things like that, we have to look at investing money in the future. And if our customers don’t know what 

funding they are going to have, how can we make investments and 

how can we go to our lending institutions that give us the funds 

we need to operate our businesses and say please give us those 

funds we need now to maintain the jobs to plan for the future, and 

we don’t know if they are going to have that money? 

This is critical to the jobs of our communities. When we talk 

about high tech jobs, training people to build hybrid, high-tech 

buses in Pembina, North Dakota, those are major investments; and 

if we lose those people, they are going to go find other jobs, and 

it is not easy to attract people to come back to these rural at-risk 

communities and build these types of equipment. This is critical to 

our future in this industry. Thank you. 

Mr. DUNCAN. Well, thank you very much. I actually was born in 

Lebanon, Tennessee. 

Let me just take a moment, since Mr. Potts brought up the fatalities and since the main emphasis of this Committee has always 

been safety, I will tell you something, sort of a story about that. 

In my district, in East Tennessee, there is a highway, Highway 

411, and it was known as a death trap, one of the most dangerous 

highways in the State of Tennessee, so much so that people were 

just getting killed on that highway on a very frequent basis. My 

chief of staff, Bob Griffiths, his only sibling, who was the quarterback of the Greenback High School football team many years ago, 

was killed on that very highway at the end of his senior year in 

high school. 

Fast forward from that about 30 years later, Mr. Griffiths has a 

first cousin whose son was the quarterback of the Greenback High 

School football team, who, at the end of his senior year, was killed 

on that same highway. 

Through this Committee, we got the funds to widen that highway 

and turn it into a four-lane highway with some turn lanes and 

22 

made that into now one of the safest highways in the State of Tennessee; and I will tell you that is what has happened through the 

work of this Committee and these highway bills all over this Nation. These bills save thousands and thousands of lives, as you 

said, and I think that is something that we need to keep sight of 

and keep in mind as we go through this process. 

Thank you very much, Mr. Chairman. 

Mr. DEFAZIO. I thank the gentleman for his eloquent statement. 

Mr. Baird. 

Mr. BAIRD. I thank the Chair and would again associate myself 

with your remarks. You know, Mr. Chairman, we are working hard 

to pass a health care bill, but this is about the health of our economy, and I would ask our panelists—I didn’t think we got much 

help from the Administration on the answer to your question earlier about how we are going to pay for this, and I think it is an 

important question. 

And I would like to ask the rest of the panelists what their 

thoughts are and also the thoughts about the consequences of not 

paying for it, which some of you have already addressed. But it is 

not cost-free to not do something; there is a huge cost to doing 

nothing. What are your thoughts, to the rest of the panel, on how 

we might try to pay for this? Because I believe we need to move 

this thing forward with great vigor and urgency. 

Mr. BRUFFY. Congressman, if I may. I think that the result of us 

not doing anything is not going to be much, except that we are 

going to have more seniors that are shut in; we are going to have 

more people who can’t get to doctors’ appointments; we are going 

to have more people sitting in congestion. Safety may improve because my buses will be sitting on congested roads and nobody is 

going to be going fast enough to create a really bad accident. 

It is not going to make a big difference, and that is what we 

need. We need a big difference in what is going on out there in our 

communities, and without a new funding vision and a new orientation from the Federal Transit Administration or whatever its following agency is, we are not going to see that; we are not going 

to have that. 

This Committee’s work, I think, steers us in the direction that 

we need to go. It has outlined a good framework and, frankly, I 

think we don’t have any choice, we need to move this forward. 

Mr. POTTS. I will make a couple of comments. One, we have consistently said that every option should be on the table to pay. Nothing is free. And to arbitrarily remove any option from the table is 

a negative. You have got to consider every option in order to fund 

it. But this is an investment in America, and it returns a high dividend. All of us in the private industry look at our return on investments that we put, and if we could get the same return on the investment we put in the transportation system in this Country, believe me, that is where we would put every dollar we have, because 

the return is extremely high. 

As I pointed out a while ago, just the loss of life alone is costing this Country $217 billion a year. Congestion is costing us over $80 

billion. And worse than that, we are losing ground from a competitive standpoint in the world economy, and every job we create in 

this industry is not exported. 

23 

Mr. BAIRD. Let me follow up on the point you just made about 

congestion costing $80 billion. We are talking about a $500 billion 

bill over five years. Eighty billion dollars is pretty close to $100 billion; you don’t have to do a whole lot of complex math. One of the 

things about this Committee is what we do is paid for, unlike almost every other Committee in the Congress. But in Highway and 

Transit, we are talking about actually paying for it, and not only 

paying for it directly, but here we have a cost savings just in the 

congestion alone that nearly pays for the price of the bill. 

So the investment will return very generously to the American 

people, and I am certain all of us would say the lives of our loved 

ones are literally priceless; so the congestion and time away from 

our families, and the costs and opportunity costs of that time. 

And I would just say to the Administration: I don’t get it. I have 

immense respect for the President and Secretary of Transportation, 

but we elected this President on a platform of change. This Committee, under the leadership of Chairman Oberstar and Chairman 

DeFazio, are proposing change, bold change, and instead, in one of 

the central areas of economic recovery, we are getting status quo 

or worse. 

So I would like to see some change we can believe in, and I 

would just urge this panel of witnesses to work with this Committee as you have already, but to get your members to talk to 

their Members of the House and Senate. The great thing about the 

United States Constitution, from my perspective, is Article 1, and 

that is us. 

Mr. Chairman DeFazio and Mr. Oberstar, I fully support you in 

your urgency to pass something, and we should do so, assert our 

authority as the United States Congress, the legislative branch, 

and that place not too far from here called the Senate needs to follow our example and we will get this thing done. Thank you. 

Mr. DEFAZIO. I thank the gentleman. 

Mr. Larsen. 

Mr. LARSEN. Thank you, Mr. Chairman. 

Mr. Kienitz, I posed some questions to you in my opening statement, and if I could summarize those for you in one sentence: What 

were you guys thinking? Could you answer that for me? 

Mr. KIENITZ. Thank you, sir. I will tell you that I spent most of 

yesterday working on the issue that you are talking about. 

Mr. LARSEN. So did I. 

Mr. KIENITZ. I think a lot of folks did. I think there are two useful responses for me to give you, the first of which is we made an 

error, and the Secretary has taken personal responsibility for that 

and taken steps that you know about to try to correct the error. 

So I am not sure there is much more about it I can say than 

that. The policy that ended up being elucidated was not what he 

wanted and was not what was intended. By way of explanation, I 

think what happened in part was a result of criteria in the Recovery Act that are somewhat different than the criteria in the underlying ferry program. 

As you have stated well, the Seattle ferry system, on which I 

have ridden, I have family in Seattle, is an order of magnitude different than anything else we have in this Country, and so, tradiVerDate Aug 31 2005 12:27 Oct 20, 2009 Jkt 000000 PO 00000 Frm 00035 Fmt 6602 Sfmt 6602 P:\DOCS\51110 JASON
24 

tionally, that has been an area where the Federal Government has 

successfully, I think, focused a significant share of that funding. 

The categorization of economically distressed areas that is in the 

Recovery Act I think is at the root of what may have happened 

here at the underlying levels of the Department, and it has helped 

highlight for us something we had already identified as an issue, 

which is the Recovery Act says a priority must be given to economically distressed areas. 

We have looked into the question of, under Federal law and regulation, what is an economically distressed area. Unfortunately, 

what we have found is that there are very specific criteria that the 

Commerce Department has elucidated and they involve going and 

looking back at employment and other data that goes back 24 

months. So I think, as everyone here knows, the economic situation 

in the Country generally and in particular parts of the Country 

was very, very different 24 months ago than it is now. 

So we both have a time lag problem in where economically distressed areas are being officially identified according to the process, 

and we also have a scale problem. I think King County, under the 

regulations of the Commerce Department, is not an economically 

distressed area. That doesn’t mean that there aren’t parts of King 

County that are economically distressed. 

So we have already been working with the Commerce Department to try to come up with a better way to identify the places that 

are economically distressed—we believe the intention of helping 

economically distressed is a good intention. We believe the method 

that we have been given to sift for that is not perfect and we are 

trying to find a way to look at it. 

But I think the most important thing is that we don’t disagree 

with your critique. In fact, the Secretary agreed with it and that 

is why he is trying to remedy it. 

Mr. OBERSTAR. Would the gentleman yield? 

Mr. LARSEN. Yes, I will yield. 

Mr. OBERSTAR. The Secretary’s analysis is somewhat correct. The 

EDA in the U.S. Department of Commerce, to which the Recovery 

Act legislation refers, does have some allocations or some designations for areas of SMSAs that may have higher unemployment figures than the SMSA itself. That has been standard in the EDA 

classification of distressed areas for at least 25 years. So I suggest 

you go back and reconsider those matters with EDA. 

Mr. KIENITZ. Yes, sir, and we are in the process of doing that. 

It is officially the decision of the Secretary of Commerce, so we are 

working with them to try to work on that. 

Mr. LARSEN. Claiming my time back, and thank you, Mr. Chairman, for that question as well. 

You are right in terms of the time lag. When this recession started, Washington State’s overall unemployment rate was well below 

the national average, in fact, but because of our dependence on 

trade, when the recession kicked in globally, we quickly caught up 

and now are actually ahead of the national unemployment rate. So 

I can understand why, two years ago, if you looked at that number, 

you would think, well, nothing is wrong. When you look at today’s 

number, it is as wrong in Washington State as it is in Oregon and 

other States. It is a pretty tough time. 

25 

I guess the concern I have is about going forward, then, as well, 

and sorting out the formula as we move forward in the authorization bill and hope that we can all learn some lessons about this as 

we are moving forward and develop a good formula that is respectful of all the ferry systems in the Country, but also recognizes that 

there are some that are much larger and some that are much 

smaller than others. 

I would recommend one reform for the Administration. Instead 

of 18-month extension, you take away 18 months and make it six 

years; instead of extension, make it reauthorization. I think we will 

be fine. 

Mr. KIENITZ. A minor amendment. 

Mr. LARSEN. Very minor. 

Mr. OBERSTAR. I thank the gentleman for those comments. 

The gentleman from South Carolina, Mr. Brown. 

Mr. BROWN. Thank you, Mr. Chairman. 

Thank you, gentlemen, for coming and participating in this discussion. I know I was late coming in, but I was telling the Chairman that I was actually on the House Floor giving a one minute 

speech encouraging the President to do something about not delaying the reauthorization 18 months. I explained that in South Carolina our unemployment is over 12 percent. We are the third highest 

in the Nation. And you heard the Chairman of the Committee talk 

about Oregon being the same way. 

We are dealing with so many issues that really don’t create jobs, 

but we absolutely know that transportation, building roads creates 

jobs. In fact, I think it has been calculated some 30,000 jobs are 

created with every billion dollars worth of construction, so, Mr. Secretary, I don’t understand the strategy behind the President’s decision to delay the highway construction. 

I know that in the stimulus bill only about $28 billion was put 

in there out of the $787 billion, which could have been a real employment opportunity, but it looks like we missed that; and I would 

hope that you would encourage the other members of the Administration to become serious about dealing with the unemployment, 

and we can do it by creating a new highway bill to be able to get 

people back to work. 

Another thing that I talked about this morning is about the red 

tape that it takes to get things moving. I think in South Carolina, 

of the $463 million that has been allocated through the stimulus 

package, only about $400,000 have been spent because of the red 

tape. I know we have some construction folks on the panel. Would 

anybody like to address that? Are you all finding the same problem 

in your arena? 

Mr. POTTS. I think that is a common problem throughout the 

Country. There have been comments made earlier. My standard assessment is, if everything stays the same, the way it has been for 

years, once a bill is passed, it is anywhere from 18 to 24, as much 

as 30 months sometimes, before we see the product. So that also 

tells you that if you extend for 18 months and get into a new program, all you are doing is extending the inevitable. And it is hard 

to make investments, from our standpoint, with that kind of time 

lag. But, realistically, it has always been about 18 to 30 months, 

and it all has to do with just getting it through the process. 

26 

Mr. KIENITZ. If I might respond to that, sir. I think on the Recovery Act, in particular, there are figures out there that relate to sort 

of dollars spent and, traditionally, the number of dollars that have 

actually been outlaid; and our view has been that that understates 

the current activity underway due to the Recovery Act, particularly 

under the highway program, because it is a program in which we 

reimburse States for expenses that they have already incurred. 

So when we give a State a go-ahead, the right to go obligate 

funds for a project, they go out and start spending their money, 

and then sometimes 15 days, 30 days, 60 days later we get the 

bills, then we pay them out, and then the official data show the 

Federal Government having ‘‘spent money.’’ But there are currently 

over 5,000 projects that have been approved to proceed and where 

expenses are being accrued, but the data of Federal reimbursements lag well behind that. 

Mr. BROWN. Mr. Secretary, if I could just follow through on another question which has been pretty dear to me. I know in South 

Carolina we have an infrastructure bank that we are able to use 

to accelerate some road projects, and I know you played a major 

role in designing the Administration’s infrastructure bank proposal. 

Can you give us some more details about this proposal, about will 

the funds be reoccurring and what will be the rate that the banks 

can leverage funds? 

Mr. KIENITZ. Yes, I have been part of a lot of discussions on that. 

At this point, what we have released is a sort of broad outline 

where we believe, at least for starting out, the banks should be focused on transportation projects, although we would be open to 

projects that have elements of other infrastructure in them, but 

transportation would be the focus. And it would be able to offer 

grants, loans, credit support, other things that we have some experience with the TIFIA program that this Committee has authorized, for which we would like to be able to do a lot more. 

As to the specific sort of leverage ratios or interest rates, I don’t 

think those things have quite been worked out yet and, frankly, 

that would be, I think, a major point of whatever debate occurs 

here and in the Senate over creating that. But I know personally, 

when I worked in the State of Pennsylvania, we had a State infrastructure bank that was part of the program that this Committee 

helped to create, and it was of some good, but, frankly, too small 

to really have an impact on big projects; it helped us do some small 

things. But that is part of the provision. I think the President’s 

proposal is to try to have a larger impact. 

Mr. BROWN. Right. And that is the reason I guess part of my 

question was to determine exactly how you plan to fund it. 

Mr. KIENITZ. As of now, there is a $2 billion allocation for the 

fiscal year 2010 in the budget resolution, so that could be the beginnings of it. I know that the Appropriations Committee here in 

the House the other day released a Chairman’s mark for their Subcommittee, which I don’t know if a reserve fund is quite the right 

word, but said there would be some funds in that appropriation 

that, if the thing were authorized, would be available to it for year 

one, $2 billion. 

I think it is realistic to say that it is something that would need 

to ramp up over time, so you might start smaller than you would 

27 

hope to end up. The prospects for authorizing such a program in 

the next 60 days are perhaps not as high as some might like, but 

I think there has been some recognition that it would be a valuable 

exercise. 

Mr. DEFAZIO. I thank the gentleman. 

Mr. Carney. 

Mr. CARNEY. Thank you, Mr. Chairman. 

I have been working with my staff on the BlackBerry here trying 

to crunch some numbers on ratios of dollars spent in the transportation bill to jobs created and efficiencies gained, lives saved, pollution reduced, all the things the Administration claims that it wants 

to do; and, actually, what we have concluded is this highway reauthorization bill, the surface transportation bill accomplishes all 

that stuff for a hell of a good price, to be quite honest. 

I don’t know why we are pushing back for 18 months. I think we 

should, for lack of a better term, start to hit the gas. Anybody want 

to weigh in on that, please? Mr. Melaniphy? 

Mr. MELANIPHY. Congressman, in transit with APTA, we have 

had some studies commissioned through a number of committees 

and found that every tax dollar invested in public transportation 

generates an average of $6.00 in economic return. Every billion dollars in Federal funding invested in transportation infrastructure 

supports 30,000 jobs, and many of those are green jobs bringing 

technology to OEMs and others. We are building a green infrastructure for this Country and it is a very clear payback in investment. 

Mr. CARNEY. Sure. And the point is that these are all the things, 

through the campaign and early on in the Administration, they 

claimed they really want to do. Here is the opportunity. 

Mr. Poupore. 

Mr. POUPORE. Thank you, Congressman. We are in the worst recession since the Great Depression. You would think the priorities 

would be to pass legislation that actually put people to work, longrange planning, and you can do it, as you have mentioned, right 

here for a penny’s worth of gas. Maybe we need a nickel or a dime 

to fix the Highway Trust Fund, but six years and millions of jobs. 

What it creates also is the people that actually go out there and 

build our roads and highways, for the most part, the members I 

represent have their own health care, but they have got to pay into 

it themselves. If they don’t have jobs, they lose that health care 

and you create this other problem. 

So the Administration has got health care out there and they 

have got cap and trade. I think they have their priorities wrong. 

I think first fix and reauthorize the highway bill, and then take a 

look at those other two major issues; and I hope maybe you can 

persuade them to do just that. 

Mr. CARNEY. It is our hope as well. 

Mr. BRUFFY. Mr. Carney, we run a shuttle between Morgantown 

and Pittsburgh. 

Mr. CARNEY. Right. 

Mr. BRUFFY. And when we put 40 folks on that bus, it only gets 

6 miles to the gallon. But when you put 40 people on it, it gets 240 

people miles to the gallon. 

Mr. CARNEY. Right. 

28 

Mr. BRUFFY. It only has one carbon emission engine; it is not 40 

carbon emission engines going back and forth. 

Over the last couple weeks, I am beginning to feel a little bit 

naive. I thought with the stimulus we were being asked to go out 

there to help the minimum wage earners, give them a viable alternative for transportation so that they can use their money for 

health care, spend it in the local economy, save it for their kids’ 

education. 

So instead of buying two buses with my stimulus funds, I bought 

three, and I invested some of our local reserve funds in it. I said, 

you know, this can be our contribution. Transit has always stepped 

up; we have always been able to help and do what we can. So I 

thought, well, we will take that extra step. 

But now, as everyone has pulled back, I am committed; I have 

a purchase order out there. They are not MCIs, but we have our 

purchase order out there, and we would like to see that pipeline 

continue. We are set, we are ready to go, and that is what we 

would like-- the direction of this Committee. We want to see that 

direction move forward. 

Mr. CARNEY. Well, not to sound too biblical here, but don’t jobs 

beget jobs? 

Mr. BRUFFY. They do. 

Mr. CARNEY. Thank you. 

Anyone else? 

Mr. POTTS. Well, I try not to repeat myself, but I think this is 

the best return on investment we can make. If you look at the surveys that we have done in the past, what is the most concern when 

people talk about a delivery system talks about the impact on the 

economy, safety, and congestion. And now congestion has been 

number one on this. 

But this bill addresses each one of those, and ever since the 

Interstate Highway Act in the 1950s, this Country’s economic engine has been our delivery system, and it is time for us to take a 

new direction with it, which this bill addresses. It addresses every 

single area, whether you are talking about energy efficiency, the 

climate, the economy, jobs. Every single issue is addressed by investing in the transportation system in this Country. 

Mr. CARNEY. Thank you. My time has run out. 

Thank you, Mr. Chairman. 

Mr. DEFAZIO. Thank you. 

Mr. Dent? 

Mr. DENT. Thank you, Mr. Chairman. I will be brief. 

One of the things I have noticed, too, I know we are here to talk 

about the long-term importance of a surface transportation authorization, but I want to mention something about stimulus funding, 

and maybe one of you can help me address this, perhaps from one 

of the States. 

In Pennsylvania, for example, I noticed that there is about $730 

million of stimulus funding that has been obligated or committed, 

but, as of June 30th, about $9 million had been spent on road and 

bridge projects. That was actually spent. I understand much is 

committed. 

And I was just curious what is happening in some other States, 

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29 

ment on that issue for me. How quickly are you able to spend the 

money? And I am not blaming you if you are not able to do it 

quickly, because I understand you get one Federal dollar, you get 

a Federal process. 

So you are using the money to resurface roads, probably, and 

paint bridges, and that is about all you can do quickly, I guess. So 

could one of you perhaps help me with that, Mr. Braceras or Mr. 

Bruffy? 

Mr. BRACERAS. Congressman, I will start off. Carlos Braceras 

with Utah DOT. I think Utah may have stood out when we were 

working with Congress on the stimulus bill. We identified that we 

would have over $12 billion worth of projects that we could commit 

and have obligated within the potential 90-day period. To date, we 

received $213.5 million in Utah. We are a relatively small State. 

We have obligated over 95 percent of those funds. Two of those 

projects are actually complete and we are working on closeout right 

now; and most of the projects are under construction today. 

Now, there is that certain time lag where we have contractors 

out there working and the reimbursement requests are still lagging 

behind that, so I think what our member States have done has 

been truly remarkable in the way that they have all stepped up 

and have been able to commit these monies as quickly as they 

have. I think the urgency that was brought to the table from the 

States and from the Federal Highway Administration—they were 

remarkable partners in helping us get to this point—it was a big 

challenge, but we feel proud about what we have been able to demonstrate, that we can commit monies to good projects, projects that 

put people to work. 

And, really, we talk about the immediate need, the immediate 

crisis that we are in and the need to put people to work quickly, 

but we shouldn’t lose sight of the long-term economic benefits that 

these projects are going to generate. They are going to be assets 

that are going to be a benefit to this Country for 50 to 100 years, 

and I believe, in the long run, the long-term benefit of these transportation projects is what is truly going to prove as a foundation 

for the economy and the quality of life in this Country. 

Mr. BRUFFY. Congressman, our State, I can’t speak to the specific 

numbers on highways, but I know that we did have three major 

projects in our three Congressional districts, and highways has 

moved forward. I know that they are also working on some smaller 

Federal highway projects because I experienced the paving on the 

way over here. 

For transit, what we did was encouraged all of our members, 

there are 18 transit systems in West Virginia, we encouraged those 

folks to commit their funds to large major capital items that 

wouldn’t require environmental reviews, things like buying buses, 

things like buying equipment, so that we could get that money 

turned around and out the door very quickly. 

For my part, we had issued a purchase order March or April, I believe, for our $950,000, and I know our other urban partners had 

done the same thing with their transit funding; they turned it 

around very quickly to try and be a participant in the recovery, get 

that money out, make those commitments so that factories could 

hire and build up their output. 

30 

Mr. DENT. Thank you. 

Mr. Kienitz, just very quickly. How do you feel about making 

some reforms to the NEPA process as part of a surface transportation reauthorization? The big complaint I keep hearing back 

home—I have heard it for years—is that it is just hard to get a lot 

of these projects moving because of the NEPA process. Do you 

think we need to engage in any type of serious reform of NEPA if 

we want to get work moving more quickly in this Country? 

Mr. KIENITZ. This is something about which I have actually a 

fair amount of experience over the last 10 years or so, and what 

my experience has taught me is that what gets labeled as NEPA 

delay is really process delay. But there are a whole bunch of pieces 

of that process that are not particularly NEPA oriented. So if the 

question is are there ways to take the cumbersome process we have 

and make it work more efficiently and quicker, I would say absolutely. I think—— 

Mr. DENT. What would you recommend? 

Mr. KIENITZ. Well, there are things that have to do with how 

property is acquired. If property is acquired under eminent domain, 

how long it takes to settle with landowners and what are the 

standards under those, and how do the court reviews work? And 

then relocation of utility lines, relocation of railroad lines; engineering and design practices; reimbursement, how quickly the contractors get reimbursed for engineering and design; and wetlands permit, air permit, those types of permits. 

So the way in which I think the States that have been most successful in doing this have been by creating better relationships between environmental and transportation agencies, including, in 

some cases, transportation funds being used to make sure that 

there are enough employees in the environmental agency so that 

the stack of projects to review isn’t sort of sitting in the in box, but 

it is getting handled quickly; as well as concurrent reviews of different types of permits. But it is sort of laborious process work. 

Mr. DENT. Well, whatever you call it, NEPA reform or process reform, I think a lot of people back home might suspect the State 

Transportation Secretaries would like to see process reform as well. 

That is all I have. I yield back. 

Mr. DEFAZIO. Mr. Arcuri. 

Mr. ARCURI. Thank you, Mr. Chairman. I will be brief. 

I would just like to raise one point. When the economic downturn 

started during the last Administration, the President proposed a 

tax cut. May of us, myself included, felt that the money might have 

been better spent in terms of putting it into infrastructure development. That didn’t happen. I supported it because I felt it was good 

for the Country and we needed it. 

When the President came out with the stimulus plan, I felt that 

a significantly larger amount, and I know many of the people on 

this Committee felt that a significantly larger part should have 

gone to infrastructure. Not as much went into it as we would have 

liked to have seen. 

But I will say this. I was home recently and went to a dedication 

of—well, it wasn’t a dedication but was actually the 

groundbreaking for beginning some road construction. I am from 

New York. New York State is not spending, they don’t have a lot 

31 

of money to spend on road construction. This was strictly stimulus 

money and we were seeing real people going to work as a result 

of the stimulus money. 

I went to Orion Bus Company, which is in my district, saw that 

they have just hired a significantly larger number of people because they are getting new orders for hybrid buses. Those are people that would not have been working but for the fact that we are 

spending money on infrastructure. It is something that we know. 

I am not sure about all of the other things that we did that the 

last Administration and this Administration did with respect to 

creating jobs, but the one thing that I know is that when we spend 

money on infrastructure, jobs are truly created and we end up with 

something very good in the long-term. We need to focus on this bill 

and we need to get this bill passed because we know from experience, both long-term and short-term, that this will create jobs. 

I have just one point, Mr. Braceras. When I talk to people in the 

private sector, business people, they always tell me when you act 

in Congress, please keep in mind that we, as business people, like 

to see long-term plans, because then we can structure our business 

plan based upon what you do. Do you find the same thing with respect to your planning in DOT with respect to the decisions that 

we make here on this Committee? 

Mr. BRACERAS. Absolutely, sir. It is critical for us to have some 

long-term predictable funding, some assurances of what we are 

going to have to do. Our processes do take longer than we wish 

they would take. Our customers wish we could turn around 

projects quicker, but it takes a long time to come up with a collaborative solution that works for all the different parties that we are 

trying to satisfy. But having that long-term vision, understanding 

where we are going as a Country, and then also knowing that the 

funding is there allows us to begin those discussions in the first 

place. 

One of the things that is really critical for us and what we manage in Utah very specifically is we want to manage the public’s expectations, so we will not begin a significant project, a large project 

if we do not have a way forward, if we do not understand how we 

are going to be able to pay for it or if it is going to be something 

that is supportive or aligns with the goals of this Nation. So what 

this Congress does is absolutely critical in how we are going to be 

able to move forward in the future. 

Mr. ARCURI. Thank you. 

Mr. Bruffy, I saw you nodding your head. Do you agree with 

that? 

Mr. BRUFFY. Absolutely. We need to know what we can plan, and 

especially about what we tell the public-- what we promise them. 

We can’t promise something we can’t deliver. That day will come 

when we have to answer for that promise. If we keep in the pipeline—these buses that we are buying, you are absolutely right, the 

long-term investment in infrastructure, these are 10-and 12-year 

pieces of equipment. This is not a car we are just going to buy 

today and use; this investment is going to be out on the road providing public service for the next 10, 12, or the way my system 

runs, that means 15 or 20 years. It is going to be in service for a 

long time. 

32 

That is the investment that we need. We can do that over time. 

We keep those factories working; we keep those people employed. 

We need to keep the pipeline flowing, and that is what this bill 

proposes to do. 

Mr. ARCURI. Well, thank you very much for your work, gentlemen. Thank you, Mr. Secretary. 

I yield back the balance of my time. 

Mr. DEFAZIO. I saw Mr. Petri. Is he still here? 

Okay, Mr. Boccieri. 

Mr. BOCCIERI. Thank you, Mr. Chairman. I just have a couple 

quick questions. I will be brief as well. 

I notice that the Under Secretary, Mr. Kienitz, when you made 

your remarks, at least in your written testimony, you said that the 

Federal Government to implement a few targeted reforms in preparation for a six-year authorization when the economy begins to recover. First of all, I don’t understand that notion, that rationale of 

thinking, that we are going to wait for the economy to recover before we implement targeted projects that are going to create jobs 

right now and that are ready to go. 

Secondly, is it fair to say that the Department of Transportation 

is balking or rejecting the consolidation efforts that would be comprised in this reauthorization bill? 

Mr. KIENITZ. In answer to the second question, I would say I 

don’t think it is fair to say that we are rejecting those. I think it 

is fair to say that we look forward to working with all the Members 

of this Committee to try to do a lot of that type of thing. We may 

have different points of view on individual pieces of it, but I think 

the larger sort of theme that Mr. Oberstar has laid out, which is 

a more multi-modal program, a more accountable program, a more 

consolidated, simpler program are all themes that I think almost 

everyone agrees with, and that includes us. 

Mr. BOCCIERI. Do you think the calls for revolution or the calls 

for reform and consolidation will quiet down in 18 months? 

Mr. KIENITZ. I haven’t heard calls for revolution. Will calls for reform quiet down? I don’t think they will. The question of the sort 

of 18-month extension I think, unfortunately, the key factor in that 

is really the shortfall between the desire for funding and the revenues to support it, and that is the piece where the current economic climate which one of the gentlemen down here described as 

the most dire in quite a long time, I think that that is the real 

horns of the dilemma, is the size of revenue increase that would 

be required to support. The authorization levels called for in the 

proposal is certainly much larger than anything Congress has even 

considered, let alone done, since I have been paying attention to 

this for 25 years. And this is a pretty bad time for something like 

that. 

Mr. BOCCIERI. Well, I will argue, as with the Chairman and 

Members of this Committee, from the long cast and litanies that 

you have heard today, that we are going to be judged by two measures, by action or inaction, and now is the time to act. Waiting another 18 months, who knows what the appetite for the Country will 

be. Who knows where we will be as a Nation if we allow unemployment figures to continue to skyrocket? This is the time to act, and 

we can make these long-term investments that will mean all the 

33 

difference for States like Ohio and all these members’ districts that 

sit on this panel. 

I yield back my time, Mr. Chairman. 

Mr. DEFAZIO. I just can’t resist, Mr. Kienitz. And I proposed a 

lot of ways and tried to think out of the box on financing, but even 

beyond that, God forbid, maybe we would borrow the money. I 

think it would be a better investment than the 20 bucks a week 

that only those who still have jobs are getting. Those who are unemployed are getting nothing. 

And not filling in any potholes or building any bridges, or health 

care, IT, whatever that is. Maybe that could have been in the 

health bill, not borrowed money in the emergency supplemental. 

On and on and on. 

So it seems to me we can borrow money for all sorts of stuff. If 

you borrow money and build a bridge that lasts 100 years, that is 

a lot better deal for someone 28 years from today, someone’s 

grandkid who is paying taxes to pay back that debt than when 

granddad got the 20 bucks a week and spent it on a pizza. So I 

think there are a lot of ways to get at this. You want to talk about 

flexibility? Let’s be flexible, and maybe we need to borrow the 

money, maybe we need to bond. There are a lot of things we can 

do. 

With that, Ms. Richardson. 

Ms. RICHARDSON. Thank you, Mr. Chairman. 

Mr. Kienitz, based upon today’s Committee’s hearing, what will 

your message be back to the Secretary and the Administration? 

And if you could be as brief as possible. 

Mr. KIENITZ. My message will be that the Members of the Committee, led by the Chair and Ranking Member of the Subcommittee 

and the full Committee, were unanimous in their desire to see a 

long-term reauthorization of the program at a high level to create 

jobs and support the economy of the United States. 

Ms. RICHARDSON. Thank you. 

Mr. KIENITZ. I hope I am getting that right. 

Mr. DEFAZIO. And be certain to tell them you were warmly received by the Committee. 

[Laughter.] 

Mr. KIENITZ. I feel that I have been treated more than fairly. 

Ms. RICHARDSON. Last Sunday, Vice President Biden was on one 

of the Sunday talk shows. Did you hear his comments regarding 

the stimulus and transportation results, or did you see the clips or 

any of the information? 

Mr. KIENITZ. I saw recountings of it, I didn’t watch it live. 

Ms. RICHARDSON. And what was your impression? 

Mr. KIENITZ. There has been a growing industry of push-back 

against the effectiveness of the stimulus program, and I think that 

that is something, frankly, that we don’t disagree with. 

One of the big arguments when there have been past pushes for 

stimulus funding that has been an argument against including infrastructure investment is, well, we need stimulus right now, in the 

next three months, six moths, and infrastructure investment takes 

too long. I think one of the breakthroughs that was made in the 

Recovery Act was folks understood that the downturn was going to 

be a long downturn, so investing in things that are not instantaVerDate Aug 31 2005 12:27 Oct 20, 2009 Jkt 000000 PO 00000 Frm 00045 Fmt 6602 Sfmt 6602 P:\DOCS\51110 JASON
34 

neous, but create employment and economic benefits over 6, 12, 18, 

24 months, is well sized to the type of current economic situation. 

So the fact that we are four months in and the world hasn’t 

changed dramatically overnight I think is not really the correct 

focus. 

Ms. RICHARDSON. Okay, if your answer could be pretty brief on 

my last two, because I have got limited time. 

Mr. KIENITZ. Yes, ma’am. Sorry. 

Ms. RICHARDSON. Based upon your knowledge of the various departments within the Administration, do you have any perception 

or have you guys heard who has best performed with the stimulus 

dollars? 

Mr. KIENITZ. I don’t think that is something, honestly, I am competent to say. I am spending a lot of hours every week working on 

our piece of it, so I am not paying attention too much. 

Ms. RICHARDSON. Okay. Well, let me use my last two minutes, 

then, to recap why I asked you the questions that I did. It seems 

quite clear to me—and I am going to be very frank for the record— 

we were in a caucus meeting and I saw our Chairman take a tremendous hit to push with the Administration to include more funding for the reauthorization. I thought he took an undue hit and, for 

the record, I think our Chairman was right and I think the President was clearly wrong. 

The message I would like for you to take back to the Secretary, 

I don’t intend upon supporting any second stimulus bill. The second 

stimulus should be the authorization of this transportation bill. 

The Vice President has acknowledged, when he was asked the 

question what has been the success of this bill, the only one he 

could recite clearly was the results of the transportation funding. 

So that is my message back. Thank you very much. 

Mr. KIENITZ. I will transmit it. 

Mr. DEFAZIO. I thank the gentlelady. 

I recognize the Chairman of the full Committee for such time as 

he might consume, and I will be going to vote and he will adjourn 

the meeting. Thank you all for being here. 

Mr. OBERSTAR. [Presiding] Thank you, Mr. Chairman. I want to 

thank Ms. Richardson for her courageous and thoughtful and 

straightforward comment and her thoughtful question to Mr. 

Kienitz. 

Mr. Potts, I think the table on page 7 of your testimony was 

brought up with excitement when I read that. I said, I have been 

saying this for months and someone has finally tabulated it. You 

have all the supply chain benefits, as I called them: iron and steel 

industry, cement and Ready Mix, oil and gas extraction, all the 

way down through landscaping and real estate insurance and so 

on. I have said that for—you tabulated it very well. 

Mr. Melaniphy, I thought your chart on the bus was terrific. I 

would like you to add to that where all those parts are manufactured. If you can do that for our next hearing on the progress on 

the Recovery Act, I think it would be very beneficial if we could 

have that not only for your company, but for the other bus and railcar manufacturers. It shows the wide distribution of jobs created 

not only at the point of delivery, but in the supply chain producing 

those products. Splendid testimony. 

35 

Mr. Poupore, I also want to thank you not only for your testimony, which I all but cheered, jumped out of my chair, as well as 

Mr. Potts, but for your letter to the Committee from the building 

trades of the Senate Committee encouraging them to—you came 

close. You came close. But that is all right, the Senate has acted. 

That is a good thing. I think they have got a bill. It is the wrong 

bill, but they have a bill out there, and the idea of House-Senate 

conference is that we reconcile differences. 

The point is, though, that there is no need for extension of current law. All we need to do is plug the hole. There is a gap. The 

end of August, the Trust Fund, Mr. Kienitz, goes into a negative 

balance, right? Week of September 4, the Trust Fund will need an 

infusion. September 11, the vouchers from the States will total $2.4 

billion and revenues deposit of Treasury into the Trust Fund will 

be $1.6 billion. That is an $800 million shortfall. 

The week of September 25 through the following week, vouchers from the States will be $2 billion against $1.55 billion. That is a 

$450 million shortfall anticipated, projected. Revenues could be different; not much, probably, for a $1.2 billion shortfall. 

If we did, as was done in 2008, make an intragovernmental 

transfer, that would keep the Trust Fund solvent; funds would continue to be paid out. And if you did a little bit more than that, you 

would assure that we would go into the second week of October 

with a full boat. The projection is that the week of October 8 vouchers from States will be $1.6 billion against revenues into the Trust 

Fund of $2.0 billion. That is due to a curious anomaly we crafted 

into anticipating this in SAFETEA in 2005. 

So to do that requires only action by the Ways and Means Committee, who has jurisdiction over the Trust Fund, and authorize or 

direct an intragovernmental transfer from general revenues into 

the Trust Fund from those revenues that the Appropriations Committee over the last 10 years has taken out of the Trust Fund to 

pay for disaster relief from hurricanes and floods and earthquakes 

and other disasters that have occurred. They have taken $7.3 billion out of the Trust Fund revenues over and above the $100 million that we provide annually for disaster relief through the Highway Trust Fund. So that revenue is owed to the Trust Fund and 

needs to be repatriated. That is really all we need to do. We need 

not authorize anything else. 

We also can justify that intragovernmental transfer on the basis 

that the Trust Fund is owed $8 billion in interest foregone on revenues into the Trust Fund from Treasury that we, at gunpoint, figurative gunpoint, had to give up under Bud Shuster’s Chairmanship 

in 1998 with the Clinton Administration and the then Republican 

majority in the House conspiring against Bud Shuster and me 

partnering on that bill to get the firewalls built around the Trust 

Fund. 

So, in the end, to get the deal, we gave up—it is the only trust 

fund that does not get interest payments on revenues into the 

Treasury, the only trust fund. Medicare does, the Social Security 

trust fund does, the harbor maintenance trust fund does, several 

others; but not Highway Trust Fund. We are treated like an orphan. Those monies are due back to the Trust Fund. We need to 

repatriate as well. 

36 

I would like to ask Mr. Braceras at the beginning of the recovery 

process—actually, that goes back to December of 2007, when we 

first proposed working with AASHTO, with ARTBA, with AGC, 

with the building trades and the transit agencies, we asked for a 

listing of projects that were shovel ready, as the term has become. 

By that we define it to mean design and engineering, right-of-way 

acquired, EIS completed, down to final design and engineering, 

ready to go to bid; and that initial list of some 6500 projects was 

refined down to roughly 5,000 projects by AASHTO. 

And now we have—let me see here on my list—we have 5,840 

projects approved by State DOTs and 4,098 projects out to bid 

through the end of May. That number will go up, as Mr. Poupore 

testified. Twenty-three hundred projects under contract worth $6.5 

billion, under contract; and 1200 projects on which work is underway. That is only through the end of May. That number is almost 

double by now, maybe even more than double. 

So I am quite certain that you State DOTs have a list of additional projects that are state of good repair projects, projects to 

bring your roadways, your bridge surfaces up to a usable condition. 

And I would recommend to AASHTO, in cooperation with Federal 

highways, with ARTBA, with AGC, to refine that list and get it 

into us. Because if there is going to be a second stimulus, it is 

going to be a highways or nothing else, because I don’t know of any 

person who has been put back to work by the $300 billion tax cut. 

I haven’t talked to a single Member who has received an email, 

a thank you note, or a handshake from a constituent who said, gee, 

thanks for the tax cut. They don’t even know that their taxes have 

been cut, but they do know that work is underway on highway 

projects and street projects and bridge projects all across America 

and that those transit buses are being built and put to use by the 

cities. 

So I think your testimony here has been wonderful. Mr. Kienitz, 

you said all the right things, came to the wrong conclusion. You are 

a good fellow. You are a seasoned professional. You have been a 

good point guard and spear bearer for the Administration doing 

your job. Thank you very much for your testimony. 

Thanks to all of you for your contributions. This is a partnership. 

We are not going to do 18 months; we are going to do a six-year 

bill, and we are going to need your help, all of you, so that we don’t 

have to send the Administration through Head Start to understand 

what we need to do for the future of transportation. Thank you. 

The Committee is adjourned. 

[Whereupon, at 12:00 p.m., the Subcommittee was adjourned.] 

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