Impacts of Proposed Federal Fiscal Year 2000 Budget
On the Transportation Equity Act for the 21st Century
On February 1, 1999, President Clinton sent his proposed Fiscal Year 2000 budget to Congress. The $1.8 trillion spending plan for the fiscal year that begins October 1, 1999, reflects the President's priorities. For 1998, revenue exceeded spending, and the federal government was able to reduce the national debt with its first surplus since 1969. A surplus of over $117 billion is projected for fiscal year 2000.
With a projected surplus, the President has proposed that Social Security receive 62 percent of future surpluses, Medicare would receive 15 percent, and 11 percent would be used to fund a variety of domestic programs. The remainder of the surplus would be used to reduce the federal debt.
Under the President's budget proposal, a number of programs under the Transportation Equity Act for the 21st Century (TEA-21) are targeted for increased funding. Due to historic low gasoline prices, and a strong economy, people are driving more and gasoline tax receipts are higher than expected. As a result, the President is proposing to use the surplus gas tax receipts to increase funding for a variety of transportation programs in TEA-21.
The President's budget proposes more TEA-21 funding for FY 2000 to reflect increased tax revenue to the National Highway Trust Fund. Nearly $1.5 billion more is anticipated in FY 2000 above the guaranteed funding level outlined when TEA-21 became law in June 1998. Under TEA-21, funding guarantees would be raised and increases evenly distributed among all transportation programs if gasoline tax revenues exceeded projections.
The President's proposal, however, departs from this original formula, by distributing a larger portion of the extra money to several "high-priority" transportation programs. This departure from the existing provisions of TEA-21 is likely to become a major issue with the highway transportation lobby and other special interests as well as with Congress. Congressman Bud Shuster, Chairman of the Committee on Transportation and Infrastructure, issued a press release on February 4 expressing his concerns about the President's proposal to redistribute increased federal transportation dollars. Shuster believes that all state transportation programs should share in the surplus evenly, as is specified in TEA-21.
Specifically, President Clinton's budget proposes increased funding for several TEA-21 programs beyond what is authorized in the existing formula for distributing higher than expected gas tax revenues. These include another $341 million for the Congestion Mitigation and Air Quality Improvement Program (CMAQ), $291 million for transit, access to jobs, and research and technology programs, $250 million to fund research to improve mobility, $125 million for highway safety programs, $35 million for new rail projects, and $25 million to support the Transportation, Community and System Preservation Pilot Program (TCSP), beyond existing TEA-21 formulas.
If the President is successful in getting legislative approval from Congress, California may get an additional $74 million in FY 2000 for CMAQ. Of this total, $69.4 million of the additional money earmarked for CMAQ will require changes to existing TEA-21 allocation formulas by Congress. CMAQ is the largest environmental component of TEA-21. CMAQ funding supports a number of activities that reduce vehicle air pollutants and traffic congestion while providing funding for alternative fuel vehicles and infrastructure. Other transportation programs will receive smaller increases in TEA-21 funding from the higher than expected gasoline tax receipts.
Overall, the Administration is planning to spend about $1.5 billion more than was projected in FY 2000 when TEA-21 became law. Of this total, California is expected to obtain $121 million or 9.1 percent of the projected increase in available TEA-21 funds.
For the Sacramento region, the Sacramento Area Council of Governments (SACOG) is the Regional Transportation Planning Authority for reviewing and approving requests for TEA-21 funding. Prior to the President's budget proposal, SACOG was expecting to receive about $15.6 million in the year 2000. If the budget is approved by Congress as presented, SACOG is likely to receive at least another $750,000 in TEA-21 funding.
Congress is currently reviewing the President's budget while developing its own budget. In the meantime, the Clinton administration will have to draft legislation to redistribute the TEA-21 funds as proposed. Rewriting the law on how excess gasoline tax revenues are distributed under TEA-21 and obtaining congressional approval will not be easy. Influential and powerful Congress members such as Shuster of Pennsylvania have already come out against the Presidents proposal. Debate on the Presidents and Congress's budget proposals is just beginning. Congressional action on the final budget is scheduled for September.
Pat Perez
Transportation Technology and Fuels Office
California Energy Commission
E-mail us about our Web Site at: mediaoffice@energy.ca.gov
"Energia" means ENERGY
in Greek and Latin.
Energy used to create this page was produced by California's electricity providers...
the most diverse in the world.