The U.S. House of Reprentatives overwhelmingly approved a $305 billion highway on Thursday that would give South Carolina over $3.5 billion in highway funding over the next five years, starting with $679 million in fiscal year 2016.
The 359-65 vote advances the first federal transportation funding legislation since 2005 to last longer than two years. In recent years, Congress has passed a series of short-term patches that made it difficult for states to plan long-term infrastructure projects and transit plans. The bill also revives the Export-Import Bank, a controversial federal lending agency that’s divided South Carolina’s Republican delegation in Congress, and includes several changes to transportation policy.
Money for S.C. road projects
The highway bill assures long-term infrastructure funding that comes at a crucial point for South Carolina, where roads and bridges are still being repaired in the Midlands after historic flooding in October.
Before they can focus on new projects, officials at the South Carolina Department of Transportation are still concentrating on just making the damaged roads passable, said spokesman Pete Poore. Flood repair costs are separate from the highway bill funding, and include emergency funding from the Federal Highway Administration and the Federal Emergency Management Agency.
The bill raises transportation funding for South Carolina and other states by 5 percent in the 2016 fiscal year, increasing to more than 15 percent in 2019.
The department is down to 58 road and bridge closures from a high of 541 on Oct. 5, and it’s working on 32 of them. The remaining 26 roads cross collapsed dams that are not owned by the department.
Even without the flood damage, 10 percent of the state’s major roads are in poor condition, and driving on them costs South Carolinians $1.3 billion a year in extra vehicle repairs and operating costs – $378 per motorist, according to transportation research group TRIP. Bridges aren’t faring much better, with more than 20 percent structurally unsound or functionally obsolete, according to the group.
The bill also would give South Carolina $249 million in mass transit funding, according to a preliminary analysis by the Eno Center for Transportation in Washington.
Export-Import bank returns
The measure would reauthorize the Export-Import Bank until 2019. The federal lending agency that makes low-interest loans to aid foreign purchases of American-made goods has split South Carolina Republicans in Washington.
The Ex-Im Bank has supported billions in exports from the state of South Carolina, helped small businesses reach markets they wouldn’t reach otherwise and created jobs and economic opportunity across our state.
Ted Pitts, CEO of the South Carolina Chamber of Commerce
Congress allowed the bank’s charter to expire in June, effectively putting it out of business, because of opposition from some House Republicans, who argue that these loans interfere with the free market. South Carolina Reps. Mick Mulvaney and Jeff Duncan joined other tea party conservatives in opposing the bank, accusing it of providing taxpayer-funded “corporate welfare.” Both voted against the highway bill.
“I don’t think the government should distort the market, which is exactly what they’re doing,” Mulvaney said Thursday. “The gains will be concentrated in small areas, it’s a traditional case of picking winners and losers –except it’s easy to see the winners – and the losses are diffused among small companies.”
The bank’s two main beneficiaries, General Electric and Boeing, blamed the uncertainty over the bank’s future when they announced U.S. job cuts this fall, including in their South Carolina locations.
Even without the flood damage, 10 percent of the state’s major roads are in poor conditions, and driving on them costs South Carolinians $1.3 billion a year in extra vehicle repairs and operating costs.
To see the short-term effects of Congress’ failure to reauthorize the Ex-Im Bank sooner, look no further than Greenville, said South Carolina Chamber of Commerce Chief Executive Ted Pitts.
“It is a shame some politicians have used Ex-Im to try to score political points when the reality is that the bank allows our businesses to compete in the global economy and create jobs at home,” he said.
GE announced in September that it would move 400 jobs to France from its power turbine plant in Greenville and from two other U.S. locations after the French equivalent of the Ex-Im bank gave them a line of credit for a global power project.
The kind of financing the Ex-Im bank gives is required just to be able to bid on large infrastructure projects, explained GE public affairs manager Meghan Thurlow – now “we can’t undo it.”
GE had already committed those jobs to France. Not a single person in South Carolina was going to lose their jobs.
Rep. Mick Mulvaney, R-S.C.
Rep. Joe Wilson, R-S.C., said this was precisely why the bank was needed to level the playing field and allow South Carolina’s businesses to stay competitive.
“More than 60 countries offer their own version of the Export-Import Bank, and it is critical that South Carolina’s businesses have the same opportunity to compete in the global economy and create jobs,” he said in a statement after voting to reauthorize the bank in October, citing the examples of Zeus of Orangeburg and Aiken, Prysmian of Lexington, AGY of Aiken, Thermal Engineering of Columbia and Charleston Aluminum of Gaston.
Boeing, which employs more than 7,500 people in South Carolina at a major manufacturing and assembly site for commercial aircraft in North Charleston, also threatened to move jobs out of the state if the bank were not reinstated.
“While none of our teammates have been terminated or moved from South Carolina since the lapse of the bank’s charter, the lapse certainly put jobs at Boeing and across our supply chain at risk,” said Boeing spokeswoman Elizabeth Merida.
Other South Carolina lawmakers – including Republican Sens. Lindsey Graham and Tim Scott, Republican Reps. Trey Gowdy, Mark Sanford and Tom Rice, and Democratic Rep. Jim Clyburn –have voiced their support for the agency.
Until you get the Chinese, the Germans and the French out of the ex-im business, I’m not going to unilaterally disarm. It is a bank that makes money and allows us to sell products made in South Carolina to the developing world in a competitive fashion.
Sen. Lindsey Graham, R-S.C.
The bank reports that it has financed over $3.3 billion in exports from 82 companies in 41 communities in the state.
Changes to transportation policy
The 1,300-page highway bill also makes changes to transportation policy, including a limited version of a proposed program to allow drivers under age 21 to drive trucks across state lines. In recent years the trucking industry has faced a shortage of drivers, and it’s looking to hire workers as young as 18 to cross interstate routes.
The bill’s provision establishing a pilot program for armed services veterans, current military members and Reservists under age 21 to obtain commercial driver’s licenses is a still a “step forward,” said South Carolina Trucking Association President Rick Todd.
“Having an arbitrary restriction on being able to drive from one end of South Carolina to another at 18, but not cross back and forth short-haul in the Charlotte or Savannah general commercial zones, is nonsensical and serves no good public policy goals,” he said.
This week’s voting on the highway bill comes just in time – current transportation funding is set to expire Friday. The Senate must vote on the bill next, and the White House has said President Barack Obama will sign it quickly to prevent an interruption in transportation spending.