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House Advances Temporary Highway Fund Fix

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The House on Tuesday passed a short-term bill to fund federal highway programs through May 2015 but did not act on President Barack Obama’s call to find a way to make the fund solvent for the long haul.

In a 367-55 vote, the House easily passed legislation that would fund federal highway and transit programs through May 31, 2015. Senate Majority Leader Harry Reid has said he is optimistic the bill can be merged with Senate legislation and passed before Congress leaves for its August recess.

Congress needs to act by the end of July to avoid the Department of Transportation from curtailing payments and ending contracts for highway projects as the Highway Trust Fund grows insolvent.

The bill provides the Highway Trust Fund with $11 billion by using pension tax changes, customs fees and a transfer from the Leaking Underground Storage Tank Trust Fund. It has been criticized by conservative groups such as Heritage Action and Club for Growth for being paid for with "budget gimmicks," and both groups are encouraging members to vote against the measure.

But both Republicans and Democrats have criticized it as a short-term Band-Aid being used in place of a needed long-term fix to the funding issues with the Highway Trust Fund.

"All this does is set us up for the same crisis a few months from now. So Congress shouldn't pat itself on the back for averting disaster for a few months,” Obama said at a rally Tuesday.

The Highway Trust Fund is funded predominantly using the 18.4-cent-per-gallon federal tax on gasoline and a 24.4-cent-per-gallon federal tax on diesel fuel. That revenue is not enough to keep up with the cost of the nation's highway programs for a number of reasons, and will become even less sustainable as more efficient cars are added to the nation's roads.

We're at a point where we about hit a brick wall in dollars for highways

One possible long-term fix for the fund issues is to increase the gas tax, something that has been ruled out by House Speaker John Boehner, R-Ohio.

"We're at a point where we about hit a brick wall in dollars for highways," Rep. Steny Hoyer, D-Md., told reporters on Tuesday. "Governors are going to have to stop issuing contracts, the county executives, mayor, etcetera. That's not a tenable situation."

-- NBC's Andrew Rafferty and Katie Wall contributed to this report

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