Intermodal Surface Transportation Efficiency Act

The Legislative and Political Process

By 1991, the interstate highway system was largely complete, but reports showed that many of the nation's roads and bridges needed extensive repairs. With increasing global competition, many cost-conscious U.S. corporations were shifting to just-in-time delivery systems from suppliers and to markets; this added pressure to view a well-functioning multimodal transportation system as a national economic priority. Despite relatively wide consensus on the need for federal action, proposed solutions and ways of paying for them were much more contentious. The final version of ISTEA was the product of significant political compromise, taking elements from Senate and House of Representatives bills that differed both from each other and from the administration's proposed plan.

The Surface Transportation and Uniform Relocation Assistance Act of 1987 (STURAA) was due to expire in February 1991. President George H. W. Bush's proposal to renew it generally maintained the status quo with marginal increases to overall spending, to $105 billion over five years. His plan proposed designation of a system of highways of national significance and offered lower reimbursement rates to states for projects not considered to have national significance, such as mass transit programs and most noninterstate highways. However, state and local officials would have more power in the project selection process through a highways block grant aimed for those roads not in the primary system.

The Senate bill's primary author was Senator Daniel Patrick Moynihan of New York, chair of the Senate Subcommittee on Water Resources, Transportation, and Infrastructure. Moynihan believed that transportation reform was needed and that continuing to heavily fund new highway construction to deal with congestion was a failing strategy. Moynihan and his allies argued that the funding structures used in prior legislation had encouraged building new highways even when concentrating on maintenance of existing roads or developing other means of transportation would provide more cost-effective or environmentally sound solutions. Whereas the president's proposal offered state and local officials increased project flexibility but provided incentives to direct funding toward a subset of highways, the Senate bill sought to level the playing field among different kinds of transportation projects.

The Senate bill thus reflected the most striking departures from previous policies. In deference to the president, the Senate bill proposed a National Highway System and a Surface Transportation Block Grant. However, the $123 billion total proposed spending (over five years) was $18 billion more than the president's plan. It featured a large increase for mass transit funding to $21 billion ($5 billion more than requested in the administration plan) and continued operating assistance to existing transit systems. While the Bush plan reimbursed mass transit projects at 50 percent for new starts and 60 percent for capital projects, urban and rural highways at 60 percent, 75 percent for noninterstate National Highway System roads, and 90 percent for interstates, the Senate plan set rates at 80 percent for all types of maintenance projects and 75 percent for new construction. In addition, presumably to combat antiurban bias, Moynihan added more authority for MPOs to be involved in transportation decision making.

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