House votes to provide money for highways, transit

WASHINGTON -- The House voted overwhelmingly Wednesday to shore up federal highway aid and veterans' health care before heading out of town for its August recess, leaving unresolved an array of sticky issues that are sure to complicate an autumn agenda groaning under the weight of indecision.

In one of their last decisions before adjourning for a month, the House backed a bill that would extend spending authority for transportation programs through Oct. 29 and replenish the federal Highway Trust Fund with $8 billion. That's enough money to keep highway and transit aid flowing to states through mid-December.

The vote was 385-34.

The Senate plans to take up the House bill before a midnight Friday deadline, when authority for the Transportation Department to process aid payments to states will expire.

Lawmakers said they were loath to take up yet another short-term transportation funding extension -- this will be the 34th extension since 2009. But Republicans and Democrats don't want to see transportation aid cut off, and they are eager to pass an amendment attached to the extension bill that fills a $3.4 billion hole in the Department of Veterans Affairs' budget. The money gap threatens to force the closure of hospitals and clinics nationwide.

The three-month patch puts off House action on a long-term transportation bill, adding one more messy fight to a fall agenda crammed with difficult, must-pass legislation.

Twelve annual spending bills face a Sept. 30 deadline but are being held up by a clash over the Confederate flag. Congress also must decide whether to approve or disapprove President Barack Obama's Iran deal and whether to pass a defense policy bill that faces a veto threat from the White House. Another fight is certain over raising the nation's borrowing authority.

Spending authority for the Federal Aviation Administration expires Sept. 30. Because long-term bills to set aviation policy have yet to be introduced in either the House or the Senate, lawmakers acknowledge they will have to pass a short-term extension there, as well.

"I think it will be an extremely active fall with the potential for either terrific accomplishment or a train wreck," said Rep. Tom Cole of Oklahoma, a member of House Republican leadership.

A $350 billion, long-term Senate transportation bill cleared a procedural hurdle Wednesday by a vote of 65-35. Senate passage is likely today. The bill would make changes to highway, transit, railroad and auto safety programs but provides only enough funds for the first three years of the six years covered by the bill. The bill also renews the Export-Import Bank that makes low-interest loans to help U.S. companies sell their products overseas. The bank's charter expired June 30 in the face of opposition from conservatives, who call it corporate welfare.

Senate GOP leaders had hoped the House would pass the long-term bill and send it to the White House before the recess. But their GOP counterparts in the House have made it clear they won't be hurried into accepting the Senate measure.

It has been a decade since Congress last passed a long-term transportation bill, although lawmakers in both parties support highway and transit aid. The difficulty has been finding the money to pay for programs in a way that doesn't increase the federal deficit.

Complicating passage of a long-term transportation bill is that President Barack Obama and House Republican leaders want to change corporate tax laws that encourage U.S. companies to park foreign profits overseas and use the resulting revenue to fully pay for highway and transit aid. But there is no consensus on the details of the corporate tax changes, and Senate Majority Leader Mitch McConnell, R-Ky., has repeatedly tried to dampen support for that approach.

House Republicans say they will use the next three months to develop a tax plan that generates enough money to pay for a long-term highway bill. Two key House members -- Reps. Charles Boustany, R-La., and Richard Neal, D-Mass. -- unveiled part of the plan Wednesday. It would create a special 10 percent tax bracket that would be applied to a portion of the income companies get from patents, formulas, inventions and other intellectual property. The current corporate income tax rate is 35 percent.

Technology firms and pharmaceutical companies would be among the beneficiaries. The goal is to slow the flow of U.S. companies that have been relocating their headquarters to foreign countries to reduce their tax bills.