updated 5/9/2005 9:10:32 PM ET 2005-05-10T01:10:32

The Senate moved Monday to add about $11 billion to a six-year highway and transit bill, putting it on a collision course with the Bush administration and a threatened veto.

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Senate leaders said the revised package with the extra money, which would raise spending for the long-delayed legislation to about $295 billion, would be paid for by finding new revenue for the federal highway trust fund. A vote on the bill, including the $11 billion addition, could come by the end of the week.

But Transportation Secretary Norman Mineta, in a statement put out in anticipation of the Senate move, said it would bankrupt the trust fund — the money coming in from the federal gas tax — by using accounting gimmicks.

“There is a dark cloud looming that will needlessly delay many important highway and transportation projects,” Mineta said.

The previous six-year highway bill expired in September 2003, and has had to be continued through six temporary extensions because of conflict between Congress and the White House over spending levels.

White House line in the sand: $284 billion
Last year the White House proposed a $256 billion package, up from $218 billion from the 1998-2003 act, and threatened to veto any bill that added to the federal deficit. This year the administration has said that anything above $284 billion, the number approved by the House in March, would be subject to a presidential veto.

The Senate, which last year approved a $318 billion bill, has pressed for higher spending, saying more was needed to reverse the current situation of inadequate, congested and deteriorating roadways.

The Texas Transportation Institute’s 2005 Urban Mobility Report issued Monday found that in 2003 there were 3.7 billion hours of travel delay and 2.3 billion gallons of wasted fuel for a total cost of more than $63 billion to the nation.

Compromise measure possible
Senate leaders hope to finish work on their bill this week, setting the stage for negotiations with the House on a compromise measure that might be acceptable to the administration. The latest extension expires May 31.

“There may be more of a will to get it done” this year, said Steve Sandherr, CEO of the Associated General Contractors of America and a leading proponent of a robust bill. He said the disparity with the White House wasn’t as great as last year. “Over six years, $11 billion is not a big deal” for such a major bill, he said.

Senate Environment and Public Works Committee Chairman James Inhofe, R-Okla., said the extra $11 billion, which includes about $8.8 billion for the highway program and $2.15 billion for transit, would help ease the discord resulting from some states paying more into the highway trust fund than they get back in federal grants.

91 cents on the dollar
Inhofe said the money would mean that states would immediately get a minimum guarantee of 91 cents back for every dollar sent to Washington, with the rate going up to 92 percent by the end of the legislative period. Donee states, who get more than they pay in, would be assured of a growth in funds given the larger pool of money.

The new revenue package, crafted by Senate Finance Committee Chairman Charles Grassley, R-Iowa, and ranking Democrat Max Baucus of Montana, would not increase the federal gas tax, now 18.4 cents per gallon of gas.

The money would come from steps to prevent fuel tax evasion, and shifting some funds that now go to the general Treasury fund, including a gas guzzler tax, to the highway trust fund. There would be provisions to close corporate tax loopholes to assure that there would be no losses to the general fund.

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