Senate passes highway funding bill

WASHINGTON — The Senate voted Thursday to keep the Highway Trust Fund running for another three months, preventing an abrupt halt to road and bridge construction at midnight Friday.

Senators voted 91-4 to pass the short-term extension, which keeps the trust fund solvent through Oct. 29. The House passed the three-month bill Wednesday. President Obama said he will sign the legislation, which ensures that states continue to receive reimbursement from the federal government for highway and mass transit projects.

The Senate also voted 65-34 to pass a six-year highway bill that they plan to use in negotiations with the House this fall in an effort to reach a deal on long-term funding. States complain that they are unable to plan and construct major projects because Congress keeps passing bills that fund transportation for only a few months at a time.

The three-month extension of highway funding approved by senators Thursday is the 34th short-term extension that Congress has passed since 2009.

Senate Majority Leader Mitch McConnell, R-Ky., said he believes the Senate and House can reach a six-year funding deal after Congress returns from its August recess.

The Senate's bipartisan bill would authorize highway funding for six years and provide a total of about $47 billion in additional funding for the first three years. The Senate bill would be paid for by reducing dividends paid by the Federal Reserve to member banks, selling a portion of the Strategic Petroleum Reserve, extending various user fees and improving tax compliance.

“The multi-year nature of this legislation is one of its most critical components," said McConnell, who negotiated the bill with Sens. Barbara Boxer, D-Calif., and James Inhofe, R-Okla. "It’s also something the House and Senate are now united on."

House leaders say they are committed to a six-year bill but have concerns about how the Senate wants to pay for the legislation. House Ways and Means Committee Chairman Paul Ryan, R-Wis., would rather pay for it by making changes in the tax code for multinational corporations.

"We all want the House to have the space it needs to develop its own bill, because we all want to work out the best possible legislation for the American people in conference," McConnell said.

One of the more contentious issues that the House and Senate will have to work out is whether or not to include a revival of the Export-Import Bank as part of the bill. The Senate-passed measure includes an amendment to renew the bank's charter through 2019. The 81-year-old bank's charter expired at the end of June.

The bank, created during the Great Depression to lend money to U.S. exporters and their foreign customers, has become a target for Tea Party-oriented Republicans, who argue that it amounts to corporate welfare for big American companies such as Boeing Co.

Supporters of the bank, including most Democrats and traditional, pro-business Republicans, say the bank also helps small businesses and creates jobs by increasing U.S. exports.

The three-month highway bill also provides $3.4 billion to fill a budget hole in the Department of Veterans Affairs that officials say would have forced the closure of VA hospitals and clinics throughout the nation.

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