WASHINGTON — President Obama will propose Wednesday a four-year, $302 billion highway bill that would be half funded by a corporate tax overhaul that Senate leaders have already said is unlikely to pass this year.
Obama's proposal aims to avoid repeated short-term extensions of construction funding for highways, bridges, railways and transit programs, and to protect 700,000 jobs, according to the administration. But Congress has been reluctant in recent years to approve longer extensions as the gas tax that funds the construction projects has failed to keep pace.
Obama's legislative proposal will come during a trip to Minnesota, where he and Transportation Secretary Anthony Foxx will launch a competition for $600 million in grants for local projects nationwide.
But the longer-term prospects for transportation funding are uncertain because the current law expires in September.
The Congressional Budget Office has projected that without a funding infusion, the Highway Trust Fund will be unable to embark on new highway projects in 2015. Foxx has said the fund could start bouncing checks in August.
The gas tax of 18.4 cents per gallon hasn't been raised since 1993, which hasn't kept pace with inflation or with vehicles that are traveling further on the same amount of fuel.
Sen. Barbara Boxer, D-Calif., head of the panel that oversees highways, said the Environment and Public Works Committee will vote in April on legislation that would authorize highway programs for five or six years. Rep. Bill Shuster, R-Pa., who is head of the House Transportation and Infrastructure Committee, is also planning to vote this summer on a bill that would extend highway funding.
But Obama signaled in his State of the Union Address that he supports using the proceeds from a corporate tax overhaul — rather than raising the gas tax, as business and labor leaders have urged — to fund transportation projects.
Rep. Dave Camp, R-Mich., who oversees the tax-writing Ways and Means Committee, is expected to unveil a tax overhaul plan Wednesday.
But Senate Majority Leader Harry Reid, D-Nev., said Tuesday rewriting the tax code will be "extremely difficult" this year.
Obama will tour St. Paul's Metro Transit light-rail operations and maintenance facility at 1:15 p.m. Then he will deliver his policy speech at Union Depot about 2 p.m.
As part of his proposal, Obama is expected to propose $150 billion in one-time funding for transportation projects in order to demonstrate how investing will create jobs, according to the administration. The money would come from closing tax loopholes, lowering tax rates and making the corporate tax system fairer, according to a fact sheet provided by the Department of Transportation.
Obama, who met Tuesday with House Speaker John Boehner, R-Ohio, will make clear that he is open to other funding ideas and wants to work with Congress in a bipartisan fashion to complete a highway bill, according to the fact sheet.