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Harry Reid Lays Groundwork For Quick Highway Trust Fund Passage

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HARRY REID
Senate Majority Leader Harry Reid (D-Nev.) answers reporters' questions during a news conference on July 10. (Photo by Chip Somodevilla/Getty Images) | Chip Somodevilla via Getty Images

WASHINGTON -– Senate Democratic leaders early next week will consider the House-passed transportation financing bill, giving some encouragement to advocates nervous about the potential lapse of federal highway funds.

Senate Majority Leader Harry Reid (D-Nev.) will attempt to forgo the potentially time-consuming process of merging a Senate-authored bill to finance the highway trust fund with the one passed by the House, two leadership sources told The Huffington Post. Instead, Reid will bring to the floor the measure that passed the lower chamber on Tuesday, aiming to have it quickly pass the Senate and move to the president’s desk to be signed into law.

That House bill, authored by House Ways and Means Chairman Dave Camp (R-Mich.) and passed with broad bipartisan support, raised just under $11 billion and keeps the highway trust fund solvent until May 2015. The pay-fors in that proposal include an accounting gimmick known as pension smoothing, which allows for a delay in corporate payments to pension funds, resulting in higher corporate tax bills. The bill also transfers money from the leaking underground storage tank fund and from customs fees.

The Senate had been poised to consider its own version of a patchwork highway trust fund bill. Authored by Finance Chairman Ron Wyden (D-Ore.), that measure included pay-fors similar to those in the House bill. But it also called for policy changes that would have improved compliance with existing tax laws -- a revenue-raiser that would have been opposed by the GOP.

With the highway trust fund expiring by the end of August -- and with payments to states set to be reduced starting the first week of that month -- Reid faced a choice. He could have tried to pass Wyden’s bill and merge it with Camp’s measure. Or he could have considered Camp’s bill with an eye on passing a longer-term fix during the lame duck congressional session following the November elections.

He chose the latter, but not without conditions. According to a Senate Democratic leadership source, Reid will allow at least two amendments to be considered when he brings Camp’s bill to a vote next week. The first will be an amendment to substitute the Camp language with the Wyden language. The second will be a proposal from Sen. Barbara Boxer (D-Calif.) that would fund the highway trust fund until December with no offsets.

There will be a 60-vote threshold on both amendments, which aides said means neither will likely pass. That sets the stage for Camp’s bill to eventually become law. The White House has already announced President Barack Obama will sign the measure.

Passage would allow Congress to dodge a potentially damaging lapse in the highway trust fund. Transportation advocates, however, are by no means cheering. Their longstanding hope was that lawmakers would pass a law that sustains the fund for the foreseeable future. In the absence of that, they wanted a deal that would last a number of years. And in the absence of that, they hoped for a patchwork measure that would keep the fund solvent only until the congressional lame duck session.

Camp’s proposal means Republicans are unlikely to move on a new highway trust fund bill until 2015, since the GOP may pick up enough seats in the election to shrink the party's Senate minority or give it an outright majority in the next session.

“Our whole logic behind wanting this to go to the lame duck because that is when we would have the best bite at the apple, not to mention it is the better long-term policy,” one transportation advocate told The Huffington Post, explaining the despondence with the likely passage of Camp’s bill. “But next year, you are likely to see, if not a Republican Senate, a more closely divided Senate…. The one caveat I would say is if this goes to an all-Republican Congress, all of the sudden they have ownership not just of highway trust fund, but a number of different issues, and they have to generate their own solutions to the problems.”

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