On March 16, the Administration released the President’s “Skinny Budget.” As is typical with a budget outline provided by a new President, the request is very high level and does not include nearly the detail of a full budget proposal. The Administration has said it will release its full Budget in May.
The Skinny Budget proposes increasing Defense spending by $54 billion, offset through steep cuts to many non-defense discretionary programs. Like most Presidential budgets, the Skinny Budget has been declared as “Dead on Arrival” in Congress. There is a lot of political support for many of the programs that would see reduced funding or be eliminated under the President’s proposed Skinny Budget, and we expect that the final appropriations for FY 2018 will look significantly different than the Skinny Budget.
In particular, the Skinny Budget proposes only funding existing full funding grant agreements through the Capital Investment Grant program (New Starts). However, there is significant Congressional support for this program and we do not think the final appropriations will reflect the Budget’s reduction.
The Director of the Office of Management and Budget (OMB), Mick Mulvaney, recently said that the funding for programs at DOT that is reduced in the Skinny Budget would be recaptured in the President’s larger infrastructure plan. Director Mulvaney said the Administration is moving funding out of existing, more inefficient programs, and directing that funding to more efficient infrastructure programs that will be included in the Administration’s infrastructure proposal. He also said that the reductions did not indicate a change in the President’s commitment to infrastructure investment.
Our analysis of the Department of Transportation budget is included here:
Funding
The President’s FY 2018 Budget requests a 13 percent decrease for the Department of Transportation (DOT), a $2.4 billion cut from $18.6 billion under the FY 2017 CR to $16.2 billion for FY 2018. The budget does not affect mandatory DOT funding, including programs funded through the Highway Trust Fund and the Airport Improvement Program, which comprise three-fourths of total federal transportation funding.
While the budget provides few specifics on DOT program funding levels, it does propose: (1) decreasing or eliminating funding for popular discretionary grant programs; (2) eliminating the Essential Air Service program; and (3) reforming the air traffic control (ATC) system.
Program Reductions
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The budget proposes to only fund Capital Investment Grant Program (New Starts) projects with existing full funding grant agreements (FFGAs). The budget would not fund any new projects under the New Starts program going forward.
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The budget proposes to end funding for long-distance Amtrak services, focusing resources on state-supported and Northeast Corridor train services.
Program Eliminations
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Transportation Investment Generating Economic Recovery (TIGER) Grant Program
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Essential Air Service (EAS) Program
Policy Highlights
The President’s budget proposes a multi-year effort to reform the ATC system, removing it from the Federal Aviation Administration and placing it under the control of an independent, non-governmental organization.
The budget also indicates that future investments in new transit projects should be funded by the localities that use and benefit from the projects, rather than the federal government.
The budget proposes eliminating the TIGER grant program and notes that the Nationally Significant Freight and Highway Projects grant program funds large freight projects with demonstrable national or regional benefits.
Senate Commerce Committee to Hold Hearing on FAA Reauthorization
On Thursday, March 23, the Senate Commerce, Science, and Transportation Subcommittee on Aviation Operations, Safety, and Security has scheduled a hearing titled “FAA Reauthorization: Perspectives on Improving Airport Infrastructure and Aviation Manufacturing.” The witnesses will be: Ms. Rhonda Hamm-Niebruegge, Executive Director, St. Louis Lambert International Airport; Mr. Bob Montgomery, Vice President, Airport Affairs, Southwest Airlines; Ms. Peggy Gilligan, Associate Administrator for Aviation Safety, Federal Aviation Administration; Dr. Gerald Dillingham, Director of Civil Aviation Issues, Government Accountability Office; and Mr. Greg Fedele, President, Sabreliner Aviation.
This Week’s Hearings:
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On Tuesday, March 21, the House Energy and Commerce Subcommittee on Communications and Technology has scheduled a hearing titled “Broadband: Deploying America’s 21st Century Infrastructure.” The witnesses will be announced.
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On Tuesday, March 21, the House Transportation and Infrastructure Subcommittee on Railroads, Pipelines, and Hazardous Materials has scheduled a roundtable titled “Emerging Railroad Technologies.” The participants will be:
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Seth Bodnar, Chief Digital Officer, GE Transportation;
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John Risch, National Legislative Director, Transportation Division, Sheet Metal, Air, Rail, and Transportation Union (SMART);
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Lisa Stabler, President, Transportation Technology Center, Inc. (TTCI); and
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Lynden Tennison, Senior Vice President and Chief Information Officer, Union Pacific Railroad Company (UPRR).
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On Tuesday, March 21, the Senate Energy and Natural Resources Committee has scheduled a hearing to receive testimony on opportunities to improve and expand infrastructure important to federal lands, recreation, water, and resources.
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Marcia Argust, Director, Restore Americas Parks Campaign, The Pew Charitable Trusts;
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Bob Bonar, President, Snowbird Ski & Summer Resort, Chairman, National Ski Areas Association Public Lands Committee;
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Jill Simmons, Executive Director, Washington Trails Association;
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David B. Spears, State Geologist, Division of Geology and Mineral Resources, Virginia Department of Mines, Minerals and Energy;
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Chris Treese, External Affairs Manager, Colorado River District; and
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Brad Worsley, President, Novo Power, LLC.
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On Wednesday, March 22, the Senate Commerce, Science, and Transportation Subcommittee on Oceans, Atmosphere, Fisheries, and Coast Guard has scheduled a hearing titled “State of the Coast Guard: Ensuring Military, National Security, and Enforcement Capability and Readiness.” The witness will be:
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Admiral Paul F. Zukunft, Commandant, U.S. Coast Guard
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On Thursday, March 23, the Senate Commerce, Science, and Transportation Subcommittee on Aviation Operations, Safety, and Security has scheduled a hearing titled “FAA Reauthorization: Perspectives on Improving Airport Infrastructure and Aviation Manufacturing.” The witnesses will be:
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Rhonda Hamm-Niebruegge, Executive Director, St. Louis Lambert International Airport;
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Bob Montgomery, Vice President, Airport Affairs, Southwest Airlines;
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Peggy Gilligan, Associate Administrator for Aviation Safety, Federal Aviation Administration;
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Gerald Dillingham, Director of Civil Aviation Issues, Government Accountability Office; and
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Greg Fedele, President, Sabreliner Aviation.
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