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On July 30, 2015, the U.S. Senate passed a short-term highway and transit bill, which extends authority through October 29, 2015, but replenishes the Highway Trust Fund into December 2015. The U.S. House passed the measure the previous day and it is expected to be signed into law by the President.
However, hours before its short-term extension vote, the U.S. Senate also passed a 6-year reauthorization bill. This legislation included an NAR supported Safe Streets amendment that would require states and metropolitan planning entities to plan and design for the safety needs of all users of federally funded projects. Since 2008, NAR has been a member of the Complete Streets Coalition asking Congress to establish a baseline of safety design to accommodate all users of transportation.
The bill also included a controversial provision to use guarantee fees (g-fees) as a pay-for, but Senate Majority Leader Mitch McConnell (R-KY) was able to approve his multi-year bill by a vote of 65-34 through his chamber. G-fees are charged and used as a risk management tool by the government-sponsored entities to protect against losses from home mortgages. However, since Fannie Mae and Freddie Mac were place in conservatorship, Congress has used their funds to pay for unrelated federal spending. Prior to the Senate vote, NAR and a coalition of real estate trades submitted 2 letters to the Senate opposing the use of g-fees for this purpose. The letters reiterated the coalition’s position that g-fees should only be used to manage the companies’ credit risk and not be diverted for unrelated spending by Congress.
This 6-year transportation bill will be the U.S. Senate’s starting point for fall negotiations with the U.S. House. U.S. House leaders, however, made clear that the U.S. Senate’s 6-year bill wouldn’t receive a vote in the lower chamber. Unless U.S. House and U.S. Senate leaders are able to hammer out their differences and produce a long-term bill that can make it through both chambers, this debate will continue and could prove contentious this fall.