Senate hasn’t given up on long-term highway deal

Top senators from both parties sounded increasingly confident on Thursday that they could negotiate a long-term highway bill, just a day after the House passed the latest in a series of short-term patches.
 
Senators were even still talking up the idea that they could finish off a $275 billion, six-year deal before the looming July 31 deadline, even as most acknowledged that any final product would likely be quite a bit shorter.
 
Meanwhile, both supporters and opponents of the Export-Import Bank acknowledged that the bank’s foes — like Sen. Ted Cruz (R-Texas) — would likely not be able to keep a reauthorization of the lender’s charter out of any Senate highway deal, no matter how long of an extension.
 
Senate Majority Leader Mitch McConnell (R-Ky.) said Thursday that top lawmakers on transportation issues, like Sens. Barbara Boxer (D-Calif.) and James Inhofe (R-Okla.), were sifting through potential methods to pay for a long-term highway bill. McConnell has set up an initial Tuesday vote for a highway measure.
 
“I still say: six-year bill. It’s going to be very ambitious. Very robust,” Inhofe told reporters on Thursday.
 
Senate Minority Whip Dick Durbin (D-Ill.) added that he believed more and more that McConnell and his conference were trying to strike a bipartisan deal. “We’re trying for six years. We’ll take less,” Durbin said. “But not six weeks. Or six months.”
 
The House passed a five-month patch of highway projects on Thursday, with leading Republicans there believing that will allow them to negotiate a tax reform deal that will pay for the sort of long-term highway deal that has eluded Congress for years. Even a three-year deal would be an accomplishment for lawmakers, given that no transportation bill has lasted longer than two years in a decade.
 
Senators from both sides of the aisle have said they’re skeptical that rewriting the country’s international tax rules is a realistic possibility before the end of the year. GOP senators also want to put the highway issue off to the side until after the 2016 election.
 
But while senators were broadly talking up the chances of a long highway deal, there was still bipartisan grumbling about some of the proposals for how to pay for it — meaning that a five-month deal still might be the best Congress can do before leaving for August recess.
 
A bipartisan group of senators have said they back the $8 billion in offsets in the House bill, which come largely from tax compliance initiatives.
 
But Democrats have said they won’t get behind the largest potential offset the Senate is considering, $30 billion in savings from a federal employee retirement savings plan, and liberals have cast a skeptical eye on other parts of the plan dealing with mortgages. Sen. Richard Shelby (R-Ala.) criticized one of the other large proposals, which would end dividends that the Federal Reserve pays to member banks.

In all, senators are looking at roughly $80 billion in offsets, which also include revenue from oil and spectrum sales.
 
Sen. Charles Schumer (D-N.Y.) — who, like House Republicans, wants to shoot for a tax reform deal this fall — sounded more open Thursday to the idea of the Senate finding a longer, bipartisan deal.
 
But Schumer also said Democrats would need to see more details about how Republicans want to pay for a highway bill.

“They’re moving on that path. That’s very good,” Schumer said about the GOP wanting to find a six-year highway bill. “But now, we’ll see how many bumps in the road there are in the path.”
 
The Transportation Department has said that it will have to roll back payments to state and local governments if Congress doesn’t act by the end of the month. The 18.4 cents-per-gallon federal gas tax has been the main source of transportation funding for decades, but the tax has not been increased since 1993 and more fuel-efficient cars have sapped its buying power.
 
Congressional scorekeepers say that lawmakers, if they want a full six-year highway bill, need to find around $100 billion to fill the gap left by the gas tax.
 
Having finished its highway bill, the House is now left to wait on their counterparts in the Senate. Majority Leader Kevin McCarthy (R-Calif.) and Ways and Means Chairman Paul Ryan (R-Wis.) were among the top lawmakers to warn the Senate not to send back a highway bill that reauthorizes Ex-Im, the federally-backed bank prized by the business community.
 
But House Minority Leader Nancy Pelosi (D-Calif.) and others said they fully expected the Senate to revive the bank’s charter, which expired at the end of June. Because the Senate is unlikely to finish its work on highways until the last week of July, the House would then have little time to decide how to respond before members leave for their districts.
 
“There’s no way the Senate doesn’t send something with Ex-Im back to the House, even if it’s attached to this five-month bill,” a transportation industry source said. “Conservatives won’t have the votes to strip it in the House and Cruz won’t be able to stop it in the Senate.”
 
Cruz and Sen. Mike Lee (R-Utah) have floated the idea of filibustering the highway bill if it restores the Ex-Im Bank. But even though McConnell and other Senate GOP leaders oppose the bank, 65 senators backed the export agency in a test vote in June — meaning that foes like Cruz would likely only be able to delay the bank’s charter from getting on the highway bill.  

“Things that have 65 senators for them usually get done,” said Sen. Roy Blunt (R-Mo.), a bank supporter.
 
Jordain Carney and Peter Schroeder contributed.