Title: Investing in America: A Penny for Progress Act
Policy area: Taxation

Summary:
Investing in America: A Penny for Progress Act
This bill amends the Internal Revenue Code to require federal taxes on gasoline and diesel fuel or kerosene to be increased annually after 2017 to account for: (1) highway construction costs, and (2) reduced fuel usage due to Corporate Average Fuel Economy (CAFE) standards. The bill exempts kerosene fuels used in aviation from the increases and limits the annual increases to 1.5 cents.
The bill also requires the Department of the Treasury to issue 30-year Invest in America Bonds in specified amounts annually through FY2030. The revenue from the bonds must be transferred to the Highway Trust Fund (HTF), with 80% allocated to the Highway Account and 20% allocated to the Mass Transit Account. The bill specifies requirements for allocating the additional funding from the HTF.
Treasury must repay the bonds using the revenues that are attributable to the increased taxes required by this bill. After all of the bonds have been redeemed, additional revenues attributable to the increases must be transferred to the HTF.
The bill also modifies Department of Transportation reporting requirements regarding: (1) infrastructure investment needs, and (2) public transportation investment needs.
The bill amends the Fixing America's Surface Transportation Act (FAST Act) to repeal a rescission of certain unobligated federal-aid highway funds apportioned among the states.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1664 Introduced in House (IH)]

<DOC>






115th CONGRESS
  1st Session
                                H. R. 1664

To amend the Internal Revenue Code of 1986 to index the gas and diesel 
        tax and rebuild our roads, bridges, and transit systems.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 22, 2017

 Mr. DeFazio introduced the following bill; which was referred to the 
   Committee on Ways and Means, and in addition to the Committee on 
  Transportation and Infrastructure, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to index the gas and diesel 
        tax and rebuild our roads, bridges, and transit systems.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Investing in America: A Penny for 
Progress Act''.

SEC. 2. DOUBLE INDEXATION OF GASOLINE AND DIESEL FUELS TAX.

    (a) In General.--Paragraph (2) of section 4081(a) of the Internal 
Revenue Code of 1986 is amended by adding at the end the following new 
subparagraph:
                    ``(E) Index for highway construction cost inflation 
                and fuel efficiency.--
                            ``(i) In general.--In the case of any 
                        calendar year after 2017, the 18.3 cents rate 
                        in subparagraph (A)(i), the 24.3 cents rate in 
                        subparagraph (A)(iii), and the 19.7 cents rate 
                        in subparagraph (D), shall each be increased by 
                        an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(II) the double indexation for 
                                the calendar year.
                        Any increase determined under this subparagraph 
                        shall be rounded to the nearest tenth of a 
                        cent.
                            ``(ii) Exception for fuel used in 
                        aviation.--The adjustment under clause (i) 
                        shall not apply with respect to the rate of tax 
                        under subparagraph (A)(iii) for fuel referred 
                        to in subparagraph (C).
                            ``(iii) Special rules to stabilize rates.--
                                    ``(I) If an adjustment of rates 
                                under clause (i) for a calendar year 
                                would result in rates in subparagraphs 
                                (A)(i), (A)(iii), and (D) in effect for 
                                the calendar year greater than 1.5 
                                cents more than the rates in effect 
                                under such subparagraphs for the 
                                preceding calendar year--
                                            ``(aa) the rates in 
                                        subparagraphs (A)(i), (A)(iii), 
                                        and (D) for the calendar year 
                                        shall be the rates in effect 
                                        under such subparagraphs for 
                                        the preceding calendar year 
                                        plus 1.5 cents,
                                            ``(bb) any adjustment of 
                                        rates that would have occurred 
                                        under clause (i) if item (aa) 
                                        were not in effect shall be 
                                        applied under that clause--

                                                    ``(AA) in the 
                                                succeeding calendar 
                                                year or years after the 
                                                rate is established 
                                                under clause (i) for 
                                                that year, and

                                                    ``(BB) until the 
                                                cumulative adjustment 
                                                of rates equals the 
                                                adjustment that would 
                                                have applied under 
                                                clause (i) if item (aa) 
                                                were not in effect, and

                                            ``(cc) an adjustment of 
                                        rates under item (bb) remains 
                                        subject to item (aa).
                                    ``(II) If an adjustment of rates 
                                under clause (i) for a calendar year 
                                would result in rates in subparagraphs 
                                (A)(i), (A)(iii), and (D) in effect for 
                                the calendar year less than the rates 
                                in effect under such subparagraphs for 
                                the preceding calendar year--
                                            ``(aa) no adjustment of 
                                        such rates shall be made for 
                                        the calendar year, and
                                            ``(bb) the rates in 
                                        subparagraphs (A)(i), (A)(iii), 
                                        and (D) for the calendar year 
                                        shall be the rates in effect 
                                        under such subparagraphs for 
                                        the preceding calendar year.
                            ``(iv) Double indexation.--For purposes of 
                        clause (i), the double indexation for any 
                        calendar year is the sum of--
                                    ``(I) the highway construction cost 
                                adjustment, and
                                    ``(II) the CAFE fuel saved 
                                adjustment.
                            ``(v) Highway construction cost 
                        adjustment.--For purposes of clause (iv), the 
                        highway construction cost adjustment for any 
                        calendar year is the percentage (if any) by 
                        which--
                                    ``(I) the National Highway 
                                Construction Cost Index for the 
                                preceding calendar year, exceeds
                                    ``(II) the National Highway 
                                Construction Cost Index for calendar 
                                year 2016 or, if applicable, the first 
                                year of a successor index.
                            ``(vi) National highway construction cost 
                        index for any calendar year.--For purposes of 
                        clause (v), the National Highway Construction 
                        Cost Index for any calendar year is the average 
                        of the National Highway Construction Cost Index 
                        as of the close of the 12-month period ending 
                        on June 30 of such calendar year.
                            ``(vii) National highway construction cost 
                        index.--For purposes of clause (v), the term 
                        `National Highway Construction Cost Index' 
                        means the last National Highway Construction 
                        Cost Index published by the Department of 
                        Transportation or successor index.
                            ``(viii) CAFE fuel saved adjustment.--For 
                        purposes of clause (iv), the CAFE fuel saved 
                        adjustment for a calendar year is the 
                        percentage (if any) by which annual motor fuel 
                        use is reduced by the estimated CAFE fuel saved 
                        for that calendar year from the annual motor 
                        fuel use for the prior calendar year.
                            ``(ix) Estimated cafe fuel saved.--The term 
                        `estimated CAFE fuel saved' for a calendar year 
                        means--
                                    ``(I) In the case of the 18.3 cents 
                                rate in subparagraph (A)(i), the 
                                combined gasoline fuel saved estimates 
                                issued by the National Highway Traffic 
                                Safety Administration and the 
                                Environmental Protection Agency for 
                                passenger automobiles and light trucks 
                                published in the Federal Register on 
                                May 7, 2010, and October 15, 2012, and 
                                for medium and heavy-duty engines and 
                                vehicles published in the Federal 
                                Register on September 15, 2011, and 
                                October 25, 2016, as part of final 
                                rules to implement corporate average 
                                fuel economy standards, and such 
                                successor estimates included in 
                                successor rules.
                                    ``(II) In the case of the 24.3 
                                cents rate in subparagraph (A)(iii) and 
                                the 19.7 cents rate in subparagraph 
                                (D), the combined diesel fuel saved 
                                estimates issued by the National 
                                Highway Traffic Safety Administration 
                                and the Environmental Protection Agency 
                                for medium and heavy-duty engines and 
                                vehicles published in the Federal 
                                Register on September 15, 2011, and 
                                October 25, 2016, as part of final 
                                rules to implement corporate average 
                                fuel economy standards, and such 
                                successor estimates included in 
                                successor rules.
                            ``(x) Annual motor fuel use.--The term 
                        `annual motor fuel use' means--
                                    ``(I) In the case of the 18.3 cents 
                                rate in subparagraph (A)(i), the total 
                                number of gallons of gasoline used in a 
                                calendar year in highway use, as 
                                published by the Federal Highway 
                                Administration as part of its annual 
                                motor fuel data survey.
                                    ``(II) In the case of the 24.3 
                                cents rate in subparagraph (A)(iii) and 
                                the 19.7 cents rate in subparagraph 
                                (D), the total number of gallons of 
                                diesel used in a calendar year in 
                                highway use, as published by the 
                                Federal Highway Administration as part 
                                of its annual motor fuel data survey.
                            ``(xi) Notice.--Not later than December 15, 
                        2017, and annually thereafter, the Secretary 
                        shall publish the rates of tax as adjusted 
                        under this subparagraph for the succeeding 
                        calendar year.''.
    (b) Retail Fuel Excise Tax.--Subsection (a) of section 4041 of such 
Code is amended by adding at the end the following new paragraph:
            ``(4) Highway inflation adjustment.--If an increase in 
        rates is made under section 4081(a)(2)(E) for any calendar year 
        after 2017, then each dollar amount in paragraphs 
        (1)(C)(iii)(I), (2)(B)(i), (2)(B)(ii), (2)(B)(iv), and (3)(A) 
        of this subsection and in subsections (b)(2)(A)(i), 
        (b)(2)(C)(i), and (m)(1) shall be increased in the same manner 
        and subject to the same conditions that are applicable under 
        section 4081(a)(2)(E).''.
    (c) Conforming Amendment.--Subparagraph (A) of section 4081(a)(2) 
of such Code is amended by striking ``The rate'' and inserting ``Except 
as provided in subparagraph (C), the rate''.
    (d) Effective Date.--The amendments made by this section shall 
apply to periods beginning after July 31, 2017.

SEC. 3. TRANSPORTATION BONDS.

    (a) Issuance.--The Secretary of the Treasury shall, pursuant to 
subchapter I of chapter 31 of title 31, United States Code, issue 
bonds, to be known as ``Invest in America Bonds'', which meet the terms 
and conditions of subsection (b), and the bond revenue shall be 
transferred to the Highway Trust Fund with 80 percent allocated to the 
Highway Account (as defined in section 9503(e)(5)(B) of the Internal 
Revenue Code of 1986) and 20 percent allocated to the Mass Transit 
Account.
    (b) Terms and Conditions.--
            (1) Term.--Bonds issued under subsection (a) shall have 
        terms of 30 years.
            (2) Frequency.--Bonds shall be issued under subsection (a) 
        every fiscal year.
            (3) Face amount formula for fiscal years 2017 through 
        2020.--Bonds issued under subsection (a) for each of fiscal 
        years 2017 through 2020 shall have a face amount that equals, 
        for that fiscal year--
                    (A) the Federal share (as defined in section 
                503(b)(8)(C)(v) of title 23, United States Code, and 
                section 308(e)(3)(E) of title 49, United States Code) 
                of the most recent estimates required under section 
                503(b)(8)(C)(iv) of title 23, United States Code, and 
                section 308(e)(3)(D) of title 49, United States Code; 
                minus
                    (B) the sum of the amount authorized in section 
                5338(a)(1) of title 49, United States Code, the amounts 
                authorized in section 1101(a) of the FAST Act (Public 
                Law 114-94; 129 Stat. 1322), the amounts authorized in 
                section 4001(a) of the FAST Act (Public Law 114-94; 129 
                Stat. 1497), and the amounts authorized in section 
                31104(a) and 31110(a) of title 49, United States Code, 
                for that fiscal year.
            (4) Face amount formula for fiscal years 2021 through 
        2013.--Bonds issued under subsection (a) for each of fiscal 
        years 2021 through 2030 shall have a face amount that equals, 
        for that fiscal year--
                    (A) the Federal share (as defined in section 
                503(b)(8)(C)(v) of title 23, United States Code, and 
                section 308(e)(3)(E) of title 49, United States Code) 
                of the most recent estimates required under section 
                503(b)(8)(C)(iv) of title 23, United States Code, and 
                section 308(e)(3)(D) of title 49, United States Code; 
                minus
                    (B) the expected revenue deposited into the Highway 
                Trust Fund for the corresponding fiscal year not 
                including revenues attributed to this section.
            (5) Amount outstanding.--Notwithstanding paragraphs (3) and 
        (4), the total face amount of bonds issued under subsection (a) 
        may not exceed the amount the Secretary of the Treasury and the 
        Secretary of Transportation determines can be redeemed, taking 
        into account this section and section 9503(g) of the Internal 
        Revenue Code of 1986.
            (6) Sunset.--No bonds may be issued under subsection (a) 
        after September 30, 2030.
    (c) Capital Investment Grant Special Rule.--Prior to the 
application of section 105 of title 23, United States Code, for a 
fiscal year, an amount equal to a percentage of bond revenue 
transferred to the Highway Trust Fund and allocated to the Mass Transit 
Account equal to the ratio of the funds appropriated in the preceding 
fiscal year to carry out section 5309 of title 49, United States Code, 
to the funds made available in the same fiscal year to carry out 
section 5338(a)(1) of title 49, United States Code, shall be available 
to make additional grants pursuant to section 5309 of title 49, United 
States Code.
    (d) Set-Aside Special Rule.--
            (1) In general.--In determining the additional amounts of 
        contract authority to be made available under section 105 of 
        title 23, United States Code, for a fiscal year, the Secretary 
        shall make adjustments under section 105(c)(1) of title 23, 
        United States Code, for a set-aside from the Highway Account 
        (as defined in section 9503(e)(5)(B) of the Internal Revenue 
        Code of 1986) or Mass Transit Account referred to in paragraph 
        (2)--
                    (A) by determining the ratio that--
                            (i) the amount authorized to be 
                        appropriated for the set-aside from the account 
                        for that fiscal year; bears to
                            (ii) the total amount authorized to be 
                        appropriated for that fiscal year for all 
                        programs (except as provided in section 105(d) 
                        of title 23, United States Code) under such 
                        account;
                    (B) by multiplying the ratio determined under 
                subparagraph (A) by the amount of the adjustment for 
                the account determined under section 105(b)(1)(B) of 
                title 23, United States Code; and
                    (C) by adjusting the amount that the Secretary 
                would have allocated for the set-aside for that fiscal 
                year but for section 105 of title 23, United States 
                Code, by the amount calculated under subparagraph (B).
            (2) Set-asides.--The set-asides referred to in paragraph 
        (1) are the amounts reserved for a fiscal year under each of--
                    (A) section 104(b)(5)(B) of title 23, United States 
                Code;
                    (B) sections 104(h)(1) and 104(h)(2) of title 23, 
                United States Code;
                    (C) section 130(e)(1) of title 23, United States 
                Code;
                    (D) section 133(h)(1)(A) of title 23, United States 
                Code;
                    (E) section 1519(a) of MAP-21 (126 Stat. 524), as 
                amended by section 1418 of the FAST Act (129 Stat. 
                1423); and
                    (F) section 5336(h)(1) of title 49, United States 
                Code.
            (3) Conforming amendments.--Section 105(g) of title 23, 
        United States Code, is amended--
                    (A) in paragraph (2) by inserting ``or the 
                Temporary Transportation Bond Repayment Account'' 
                before the period at the end; and
                    (B) by adding at the end the following:
            ``(4) Temporary transportation bond repayment account.--The 
        term `Temporary Transportation Bond Repayment Account' means 
        the Temporary Transportation Bond Repayment Account of the 
        Highway Trust Fund established under section 9503(g) of the 
        Internal Revenue Code of 1986.''.
    (e) Temporary Transportation Bond Repayment Account.--Section 9503 
of the Internal Revenue Code of 1986 is amended by adding at the end 
the following new subsection:
    ``(g) Establishment of Temporary Transportation Bond Repayment 
Account.--
            ``(1) Creation of account.--There is established in the 
        Highway Trust Fund a separate account to be known as the 
        `Temporary Transportation Bond Repayment Account' consisting of 
        such amounts as may be transferred or credited to the Temporary 
        Transportation Bond Repayment Account as provided in this 
        section.
            ``(2) Transfers to temporary transportation bond repayment 
        account.--The Secretary of the Treasury shall transfer to the 
        Temporary Transportation Bond Repayment Account the portion of 
        the amounts appropriated to the Highway Trust Fund under 
        subsection (b) which are attributable to the increase in taxes 
        under--
                    ``(A) section 4041 by reason of section 4041(a)(4), 
                and
                    ``(B) section 4081 by reason of section 
                4081(a)(2)(E).
            ``(3) Expenditures from account.--Amounts in the Temporary 
        Transportation Bond Repayment Account shall be available for 
        redeeming bonds and paying interest payments issued under 
        section 3 of the Investing in America: A Penny for Progress 
        Act.
            ``(4) Termination.--When all bonds issued under section 3 
        of the Investing in America: A Penny for Progress Act have been 
        redeemed--
                    ``(A) the Temporary Transportation Bond Repayment 
                Account shall close, and
                    ``(B) all amounts in the account (and all future 
                revenue that, absent this paragraph, would have been 
                transferred to the account pursuant to paragraph (2)) 
                shall be transferred to the Highway Trust Fund with 80 
                percent allocated to the Highway Account (as defined in 
                section 9503(e)(5)(B) of the Internal Revenue Code of 
                1986) and 20 percent allocated to the Mass Transit 
                Account.''.
    (f) Conforming Amendment.--Section 9503(e)(5)(B) of the Internal 
Revenue Code of 1986 is amended by inserting ``or the Temporary 
Transportation Bond Repayment Account'' before the period at the end.
    (g) Effective Date.--The amendments made by this section shall 
apply upon enactment of this law.

SEC. 4. CONDITIONS AND PERFORMANCE REPORTING.

    (a) Report on Infrastructure Investment Needs.--Section 503(b)(8) 
of title 23, United States Code, is amended to read as follows:
            ``(8) Report on infrastructure investment needs.--
                    ``(A) In general.--Not later than July 31, 2018, 
                and July 31 of every second year thereafter, the 
                Secretary shall submit to the Committee on 
                Transportation and Infrastructure of the House of 
                Representatives and the Committee on Environment and 
                Public Works of the Senate a report that describes--
                            ``(i) the current conditions and 
                        performance of highway and bridge facilities in 
                        the United States, including the backlog of 
                        current highway and bridge needs; and
                            ``(ii) the future needs of highway and 
                        bridge facilities in the United States.
                    ``(B) Comparisons.--A report under this paragraph 
                shall include all information necessary to relate and 
                compare the conditions and performance measures used in 
                the previous biennial reports to the conditions and 
                performance measures used in the current report.
                    ``(C) Report requirements.--In developing a report 
                under this paragraph, the Secretary shall--
                            ``(i) prepare a complete assessment of 
                        highway and bridge facilities in the United 
                        States;
                            ``(ii) for the succeeding 20-year period, 
                        estimate future capital requirements for 
                        highway and bridge facilities in the United 
                        States at specified levels of service;
                            ``(iii) for the succeeding 20-year period, 
                        estimate the annual expenditures necessary to 
                        fund capital projects in the United States 
                        that--
                                    ``(I) are necessary to address the 
                                current and future needs of highway and 
                                bridge facilities; and
                                    ``(II) have a benefit-cost ratio 
                                greater than or equal to 1;
                            ``(iv) for the period ending December 31, 
                        2036, estimate the annual expenditures 
                        necessary to fund capital projects in the 
                        United States that--
                                    ``(I) are necessary to address the 
                                current and future needs of highway and 
                                bridge facilities; and
                                    ``(II) have a benefit-cost ratio 
                                greater than or equal to 1; and
                            ``(v) for the preceding 10-year period, 
                        estimate the average annual percentage of the 
                        total expenditures made for highway and bridge 
                        capital projects by all levels of government 
                        that was derived from Federal funds.''.
    (b) Report on Public Transportation Investment Needs.--Section 
308(e) of title 49, United States Code, is amended to read as follows:
    ``(e) Report on Public Transportation Investment Needs.--
            ``(1) In general.--Not later than July 31, 2018, and July 
        31 of every second year thereafter, the Secretary shall submit 
        to the Committee on Transportation and Infrastructure of the 
        House of Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate a report that describes--
                    ``(A) the current conditions and performance of 
                public transportation systems in the United States, 
                including the state of good repair backlog among 
                existing public transportation systems; and
                    ``(B) the future needs of public transportation 
                systems in the United States.
            ``(2) Comparisons.--A report under this subsection shall 
        include all information necessary to relate and compare the 
        conditions and performance measures used in the previous 
        biennial reports to the conditions and performance measures 
        used in the current report.
            ``(3) Contents.--In developing a report under this 
        subsection, the Secretary shall--
                    ``(A) prepare a complete assessment of public 
                transportation systems in the United States;
                    ``(B) for the succeeding 20-year period, estimate 
                the future capital requirements for public 
                transportation systems in the United States at 
                specified levels of service;
                    ``(C) for the succeeding 20-year period, estimate 
                the annual capital expenditures necessary to fund 
                capital projects in the United States that have a 
                benefit-cost ratio greater than one and are necessary--
                            ``(i) to achieve and maintain a state of 
                        good repair for public transportation systems; 
                        and
                            ``(ii) to support the long-term trend rate 
                        of public transportation ridership growth, plus 
                        an additional 0.3 percent; and
                    ``(D) for the period ending December 31, 2036, 
                estimate the annual capital expenditures necessary to 
                fund capital projects in the United States that have a 
                benefit-cost ratio greater than one and are necessary--
                            ``(i) to achieve and maintain a state of 
                        good repair for public transportation systems; 
                        and
                            ``(ii) to support the long-term trend rate 
                        of public transportation ridership growth, plus 
                        an additional 0.3 percent; and
                    ``(E) for the preceding 10-year period, estimate 
                the average annual percentage of the total expenditures 
                made by all levels of government for public 
                transportation capital expenditures that was derived 
                from Federal funds.''.
    (c) Interim Reporting Method.--Prior to the publication of the 
reports required under the amendments made by subsections (a) and (b), 
the Secretary of Transportation shall provide to the Secretary of the 
Treasury the data necessary to calculate the bond face amount under 
section 3(b) using the most recent published reports required by 
section 503(b)(8) of title 23, United States Code, and section 308(e) 
of title 49, United States Code.

SEC. 5. REPEAL OF FAST ACT RESCISSION.

    Section 1438 of the FAST Act (Public Law 114-94; 129 Stat. 1432), 
and the item relating to that section in section 1(b) of that Act, are 
repealed.
                                 <all>