Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users

SAFE, ACCOUNTABLE, FLEXIBLE, EFFICIENT TRANSPORTATION EQUITY ACT: A LEGACY FOR USERS

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EXISE TAX ON HIGHWAY VEHICLES

Mr. CONRAD. Mr. President, I would like to engage my friend from Iowa, the chairman of the Finance Commitee, as well as my friend Senator BAUCUS, the ranking member of the committee in a brief colloquy.

The transportation reauthorization legislation that this body is considering includes a very important provision that is intended to provide clarity with respect to the excise tax on certain highway vehicles under Internal Revenue Code Section 4051. Can my colleagues confirm that it is the drafters' intent that this provision will allow vehicle dealers to rely on the gross combined weight rating established by the manufacturer?

Mr. GRASSLEY. That is our intent. Present law allows the seller to rely on the weight rating specified by the manufacturer when determining the applicability of vehicle excise taxes on trucks. The same rule should apply for tractors.

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Mr. GRASSLEY. Mr. President, today is our final step to positively reaffirm our commitment to a strong and dedicated highway program, the safety and soundness of its infrastructure, and the security of the Nation's transportation network.

But in the process of pursuing and completing those goals, conferees had to make many decisions. As chairman of the Finance Committee, at the outset, I committed to several fundamental principles during this conference.

First, that the bill be paid for. Whatever we added to the trust fund should not increase the deficit. If you look at the revenue table, prepared by Joint Tax, you will see that the new trust fund money raised by fuel fraud enforcement is raised in a deficit-neutral manner. The tax-writing committees were fiscally responsible in our efforts to grow the trust fund.

Second, highway taxes pay for highways. These are taxes that will be collected regardless of whether or not we have a highway bill. They can't be used for anything else. The tax provisions of the highway bill aggressively focus on collecting all of the taxes due and owed to the highway trust fund.

So we increase the size of the trust fund. Primarily, we do it by being tough on fraud. Some of this fraud is just plain old criminal activity--but we have reason to believe that billions of our highway tax dollars are being stolen for a more sinister purpose, that being the potential funding of terrorism. So we have the opportunity with this legislation to not only shut down these thieves but to rightfully collect all of our highway taxes to fully fund this bill. Under the Senate bill, several billion dollars will be added to the highway trust fund merely by moving jet fuel to the rack. Unfortunately, we can't keep all of the untaxed jet fuel out of the diesel market unless all 50 States move all of their fuel tax collection to the rack. But we can collect billions that are currently stolen from both airport and highway trust funds.

The third principle was to provide the highway trust fund with sufficient resources to serve America's highway needs. The additional resources the Finance Committee produced for the authorizers, I believe, enabled this deal to happen. Add up last year's FSC-ETI conference report changes and the trust fund gained $24 billion extra. This year we have added another roughly $3 billion in additional receipts for the trust fund. Without these additional resources, we would have faced another case of legislative gridlock. Legislative gridlock wouldn't help the folks we represent who were facing gridlock on their roads.

I would also like to mention two policy initiatives that do not relate to the highway trust fund. The Senate carried into conference a package of excise tax reforms and a transportation bond proposal.

The legislation before us also includes a number of excise tax reforms. These are small items, but important to the affected taxpayers. For the most part, these provisions simplify various Federal excise taxes.

I will note that these excise tax reforms do lose some revenue. It is roughly $1 billion over the 10-year period. When the highway bill came out of the Senate, these measures were offset with revenue raisers to make them deficit neutral. The House did not accept the group of revenue raisers we had allocated to these provisions. It should be noted that the budget resolution provides $36 billion over 5 years for tax relief outside of reconciliation. So this relatively minor deficit impact is accounted for in the budget.

Finally, I am pleased we were able to reach agreement on the Talent-Wyden transportation infrastructure private activity bond proposal. Senators TALENT and WYDEN are to be commended for pursuing this innovative concept. There will now be $15 billion in bond authority for transportation projects.

We did hear some sharp criticisms of the heavy-lifting the Finance Committee did to make this bill happen. We were told our offsets weren't real and that phony accounting occurred in the highway trust fund. I rebutted these charges during Senate floor debate. I said our principles would be honored in conference and they were. We got the job done.

In the end, that is what counts: doing the peoples' business. The conferees achieved an important policy objective. The highway trust fund more accurately reflects the resources it receives from the taxpayers who use our Nation's roads. The resources will go into maintaining and improving America's highway system. All of this will be accomplished in a fiscally responsible manner. That is what the folks back home should expect. That is what we have done. That is what really matters. That is why the folks back home sent us here in the first place.

In conclusion, after great effort by many people, the Senate is poised to enacting legislation with the potential to impact all Americans in every State. Crumbling infrastructure and poor transportation choices impede our ability to live and do business, and today we are going to deliver legislation to the President's desk to start solving these problems. Our conference agreement utilizes more than $285 billion to ensure all Americans have access to efficient and reliable transportation as they go about their professional and personal lives.

Among the many people whose hard work has made the difference, I must first thank the chairmen and ranking members of all the appropriating committees that have been involved in this process.

Credit must also go to all members of my staff, who spent many hours sifting through the nuts and bolts of this bill. Kolan Davis, Mark Prater, Elizabeth Paris, Christy Mistr, Sherry Kuntz, John Good, and Nick Wyatt showed great dedication to the tasks before them.

As is usually the case, the cooperation of Senator BAUCUS and his staff was imperative. I particularly want to thank Russ Sullivan, Patrick Heck, Bill Dauster, Kathy Ruffalo-Farnsworth, Matt Jones, and Ryan Abraham.

I also want to mention George K. Yin, the chief of staff of the Joint Committee on Taxation and his staff, especially the fuel fraud team of Tom Barthold, Deirdre James, Roger Colinvaux, and Allen Littman as well as the always invaluable assistance of Mark Mathiesen, Jim Fransen, and Mark McGunagle of Senate Legislative Counsel.

This conference agreement is infused with the spirit of bipartisan and bicameral cooperation. Hopefully, that spirit will be influential to the entire ongoing legislative process.

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