CBO: Oil, gas measures to raise just $2 billion for GOP highway bill

Three Republican measures to expand oil-and-gas production and use the resulting revenues to partially pay for legislation reauthorizing surface-transportation programs would yield only about $2 billion of the roughly $50 billion in needed funding, according to government estimates.

The $260 billion GOP legislation would reauthorize spending from the Highway Trust Fund through fiscal 2016 and seek to use the oil-and-gas measures to at least partially offset a roughly $50 billion projected funding gap. But the oil-and-gas bills would raise just $2.06 billion for the trust fund in that time period and bring in no money at all until 2014, according to the Congressional Budget Office, the nonpartisan budget analyst of Congress.

The Highway Trust Fund, which finances highways, bridges and mass-transit projects with fuel tax revenues, is spending more than it collects and could go dry in 2013 or later, the Congressional Budget Office has said. Republicans have insisted on finding methods other than fuel tax increases to keep the fund solvent and close the gap.

“As the speaker has said, the energy portion was never intended to cover the entire shortfall,” Spencer Pederson, spokesman for the House Natural Resources Committee Republicans, said in an email.

A $40 billion money transfer from the Treasury to the trust fund will cover most of its roughly $50 billion future gap. The transfer would need its own offset to avoid raising the debt. Republicans say they now plan to include in the transportation bill a measure requiring federal employees to contribute more to their pensions as a way to “help ensure the [transportation bill] doesn’t add a penny to the debt.” It’s unclear if any trust fund shortfall would remain.

The pension measure’s inclusion would “help pay for near-term infrastructure improvements while expanded energy production comes on line,” Don Seymour, digital communications director to House Speaker John Boehner, R-Ohio, wrote on his blog.

Critics of the House’s funding approach have called the oil-and-gas provisions too controversial. They seized on the CBO’s estimates.

“It’s our estimation that the CBO’s scores make it fairly obvious that this is not a serious effort by the House to pay for its transportation bill with increased royalties,” said Erich Zimmermann, senior policy analyst with Taxpayers for Common Sense, which advocates cutting wasteful spending.

The CBO estimates confirm that “the odd linkage [between infrastructure and oil-and-gas production] isn’t just environmentally damaging but fiscally irresponsible,” said Deron Lovaas, transportation program director at the Natural Resources Defense Council, an environmental group.

Two of the energy bills, which would open the Arctic National Wildlife Refuge to drilling and lease new waters of the outer continental shelf, would account for virtually all of the $2.06 billion over the period covered by the bill, according to the CBO.

A third bill, which would require the Interior Department to issue commercial leases on Western lands for development of oil shale, would raise just $5 million in that timeframe, the CBO said.

The House has finished committee work on all the individual components of its surface-transportation bill. The three energy bills and the transportation, pension and tax-related components will be wrapped into a broader package that could come up for a vote next week.

The Senate’s two-year, $109 billion legislation uses a number of different offsets, but not oil-and-gas revenues, in seeking to cover a roughly $12 billion gap.