Super Committee Fails to Produce Bill; Future Transportation Cuts Possible

Congress’ Joint Select Committee on Deficit Reduction failed to approve a bill by its Nov. 23 deadline, triggering $1.2 trillion in mandatory federal budget cuts beginning in calendar year 2013. U.S. Transportation Secretary Ray LaHood expressed disappointment that the “super committee,” which had been given special powers, could not reach an agreement, which could have a future impact on federal transportation programs funded with general revenue.”Because the super committee failed to reach an agreement, we now face across-the-board cuts to programs that are critical to rebuilding our crumbling transportation infrastructure and putting Americans back to work,” LaHood said in a statement issued last week. “The American people want common-sense, bipartisan solutions that take a balanced approach to reducing the deficit while protecting critical transportation investments that create jobs and allow our economy to grow.”

LaHood implored Congress “to set aside politics and get to work on a bipartisan plan that will allow us to live within our means, while also meeting our responsibility to rebuild America’s critical transportation infrastructure.”

The automatic spending cuts, known as “sequesters,” will take effect Jan. 2, 2013, unless Congress changes the law governing deficit reduction. That law (Public Law 112-25, the Budget Control Act of 2011) was enacted in August to raise the nation’s debt ceiling only hours before the U.S. Treasury Department was set to run out of money to continue paying America’s financial obligations. (see Aug. 5 AASHTO Journal story)

Beginning in 2013, the Office of Management and Budget will divide the required $1.2 trillion spending reductions evenly over nine years. Half the cuts must come from defense programs and the other half from nondefense programs — including transportation programs not funded by the Highway Trust Fund, which has dedicated revenue sources and pays for most federal highway and transit grants to the states.

Nondefense spending cuts are estimated to total about $55 billion per year from 2013 to 2021, according to Congressional Quarterly. (A CQ chart illustrating how the automatic spending cuts will take place is available at bit.ly/CQcuts).