Stopgap: Giving Congress Until October 2015 to Agree on a Highway Funding Plan (H.R. 3236)

What is H.R. 3236?

(Updated July 19, 2017)

This bill was enacted on July 31, 2015

This bill would fund highway and transportation projects through the Highway Trust Fund until October 29, 2015 and also expand a program allowing veterans to receive subsidized health care outside of the Dept. of Veterans Affairs (VA). The program’s spending authority is currently set to expire on July 31, 2015. The bill’s sponsors hope that a three-month extension will give members of Congress enough time to reach a long-term agreement on highway and transportation funding.

It is notable that this bill actually reduces the deficit between 2015 and 2025 by using a combination of spending reductions and provisions that would improve tax compliance. These offsets were included in a proposal that would’ve extended the Highway Trust Fund through December 2015. Among those offset provisions would be:

• A requirement that lenders report additional information so that borrowers don’t understate their tax burden. Lawmakers estimate that this will provide an estimated $1.8 billion in offsets.

• Giving the IRS a six-year window to review returns that were substantially understated. Estimated offsets? $1.2 billion.

• Requiring estates subject to the estate tax to report the value of property upon the owner’s death — yielding an estimated $1.5 billion in offsets.

• Tax filing deadline changes for partnerships, S corporations, and C corporations with offsets estimates at $314 million.

• Extending a rule that allows employers to transfer excess defined-benefit plan assets to retiree medical accounts and group-term life insurance — yielding $172 million in offsets.

• Equalizing taxes on liquefied natural gas, liquefied petroleum gas, and compressed natural gas from different levels would provide $90 million in tax relief (not offsets).

• The current budget treatment of Transportation Security Administration (TSA) fees would be extended for two additional years, leading to $3.1 billion in offsets.

It also includes provisions of the Hire More Heroes Act, allowing veterans who are enrolled in government healthcare through TRICARE or the VA to be exempt from the employer mandate — which requires businesses to offer health insurance if they have more than 50 full-time employees. Eligible veterans would be eligible to make pre-tax contributions to Health Savings Accounts if they receive care from the VA if they are receiving treatment for a service-connected disability.

Argument in favor

It's unrealistic to expect a long-term solution for transportation funding to materialize in two days before the most recent extension expires. This bill would give Congress a chance to get a permanent fix done in October. Allowing veterans to access subsidized healthcare outside the VA will give them more efficient access to health care.

Argument opposed

There’s been far too much kicking the can down the road in Congress recently. There is a bipartisan consensus that something longer-term must be done for transportation funding: put a long-term fix up for a vote, and deal with veterans healthcare separately!

Impact

Anyone who uses roads and highways, businesses and agencies that repair and manage roads, the Dept. of Transportation, and the HTF administrators.

Cost of H.R. 3236

The CBO estimates that implementing this bill would authorize $12 billion in contract authority through the end of October, and limit discretionary spending to $4 billion over the 2016-2025 period. On balance, this bill would decrease deficits by $6.9 billion over the 2015-2025 period.

Additional Info

In-Depth: Upon introducing this bill, Rep. Bill Shuster (R-PA) — the Chairman of the House Transportation and Infrastructure Committee — cited the need for a longer-term fix and his hope that this legislation would provide Congress the necessary time to reach such a solution:

“My goal remains the completion of a long-term bill to improve our Nation’s roads, bridges, and other infrastructure as soon as possible, and the House continues to make progress on that bill. THe Senate’s work on their transportation bill is a positive step, but the House also needs to make its voice heard and put forth its own priorities for such a significant piece of legislation.”

A previous extension for the Highway Trust Fund was introduced on May 14, 2015 and provided for funding until the end of July. It was signed into law on May 28, and various longer-term proposals were being discussed that the time — which ranged from providing additional funding sources for the HTF for a six-year fix to letting the HTF expire.