On October 9, Chairman of the House Special Committee on Homeland Security, Representative Christopher Cox (R-California) introduced “The Faster and Smarter Funding for First Responders Act” (HR 3266). Cox’s bill would completely reshape the way in which ‘first responder’ grants are distributed. The bill would authorize no new funding, but would alter the formula currently used by the Department of Homeland to determine how much each state receives in homeland security grants. DHS currently bases their allocation of funds on threat assessments and populations levels of respective states, which guarantees every state at least some level of funding.

Homeland Security Secretary Tom Ridge is on record as favoring the use of threat assessments rather than population levels as a basis for creating an allotment formula for homeland security grants. The Bush Administration wants to consolidate all state and local assistance in the Office of Domestic Preparedness in the Homeland Security Department. However, the new grant program in H.R. 3266 would not include Assistance to Firefighter Grants and other programs intended for states and regions which originated before 9/11. The new State and Regional First Responder Grant Program would combine the State Homeland Security Grant Program with the Urban Area Security Initiative Grant Program. These two programs distributed about $2.8 billion in fiscal 2003.

Under the Cox proposal, Secretary Ridge would administer the grants through the Office for State and Local Government Coordination. Grants would go to states and regions with demonstrated threats to their people and critical infrastructure. The Undersecretary for Information Analysis and Infrastructure Protection will provide the Secretary will insight and analysis on which states and regions meet this threshold. When the Undersecretary evaluates and prioritizes grant applications, the bill asks the Undersecretary to first consider states and regions with:

• large military and tourist populations
• specific economic sectors or private sector facilities
• major communication nodes
• specific elements of the nation’s food supply water systems
• power plants
• civic infrastructure
• emergency response capabilities
• specific national monuments with numerous tourists
• significant natural resources on which economic sectors or population centers depend
• major transportation systems or nodes

Recipients of grants may use funds for: purchasing or upgrading equipment; exercises to strengthen emergency response; training in the use of equipment; and training for prevention of, preparedness for, or response to attacks involving weapons of mass destruction.

When states or multi-state entities receive grants, they must distribute at least 80% of the money to local governments, first responders or other local groups whom will carry out the homeland security plan called for in the grant application. Each recipient of a grant award will have to submit an annual report to the Secretary documenting the dates such funds were received, the dates such funds were disbursed and how the funds were utilized by the ultimate beneficiary.

H.R. 3266 would also establish an ‘Advisory Council on First Responders’, which will be responsible for providing advice to the Secretary on the need to implement federal standards for first responder equipment and training. The council will report to the head of the Office of State and Local Government Coordination.

Besides consolidating first responder grants, the bill would also update the heavily criticized Homeland Security Advisory System. H.R. 3266 would require that any designation of a threat level be accompanied by a designation of the geographic regions and economic sectors to which the designation applies.

Cox acknowledges that his bill will be politically difficult to pass because some regions like New York and Washington will likely receive more money than rural states like Vermont, Wyoming, Iowa and Vermont. In a Senate Appropriations Committee hearing last month, Senator Patrick Leahy (D-Vermont) told Secretary Ridge that each state should be guaranteed a minimum amount of funding.

Cox recently argued that the system is too politicized and that funds are often bogged down in the bureaucracy and by the states. He wants to make sure the money actually goes to the cities and regions with actual threats . “the threat analysis will permit us to allocate the funds by need, not by political formula , ” he said.

Chairman Cox mentioned that the administration supports most of his bill, but has some issues with other provisions in the bill, which they are communicating to the committee.

Cox wants to hold hearings on his bill and have a committee markup by the end of the month. The Chairman will most likely also seek input from committee Ranking Member Jim Turner (D-Texas), who introduced his own first responder bill, the “Prepare Act” (H.R. 3158). Turner’s bill, which is cosponsored by every democrat on the committee, would establish a national anti-terrorism preparedness standard as the basis for allotting federal dollars for first responder training and equipment.

Also, Christopher Shays (R-Connecticut), Chairman of the Government Subcommittee on National Security, Emerging Threats and International Relations has his own bill (H.R. 3227), which would also establish a national standard for first responders, and would set a deadline for that standard to be in place.

The Congressional Budget Office (CBO) announced yesterday that the federal government had a deficit of $374 billion dollars for fiscal year 2003. While this is still a record, it is less than the $401 billion figure projected by the CBO in August.

The lower figure may reflect some good news about the economy, particularly because $7 billion came from strong corporate income taxes.

GOP leaders in the House and the Senate plan to use the week of October 20th and possibly the week of October 27th to wrap up work on the fiscal year 2004 appropriations bills.

Right now, the top priority for lawmakers is the White House supplemental appropriations request of $87 billion for Iraq and Afghanistan. House appropriators will soon draft an omnibus spending bill, which will likely include the six bills that have not been sent to conference yet. The following appropriations bill will likely be included in an omnibus package: Agriculture (HR 2673), Commerce-Justice-State (HR 2799), District of Columbia (HR 2765), foreign operations (HR 2800), Transportation-Treasury (HR 2989) and VA-HUD (HR 2861)

If the omnibus package passes both the House and the Senate next week, it will be sent to a conference committee during the week of October 20th. Conference negotiations over the omnibus spending package are expected to be lengthy and cumbersome, but Republican leaders want Congress to be finished with appropriations by early November. If conferees fail to finish work on an omnibus spending package by October 31st, another interim continuing resolution will have to be passed.

Appropriators in the Senate have expressed interest in moving some of the spending measures individually. However, this looks difficult for Senate Majority Leader Frist (R-Tennessee) to achieve since the fiscal year is already in its second week.

So far, three of 13 total spending bills have been enacted and four are currently being negotiated in conference.

The House Appropriations Committee approved an $86.8 billion package for Iraq and Afghanistan today by a vote of 47-14. The bill is similar to the $87 billion plan that President Bush proposed on Sept. 7. The Senate also plans to vote on its similar version of the bill next week.

The vote came after the White House derailed an attempt to turn the aid into a loan.

Key republican Rep. Zach Wamp (R-Tennessee) decided against trying to make half the bill's $18.6 billion for Iraqi rebuilding a loan at the urging of the President and after realizing he lacked the votes to prevail.

The committee voted 36-25 to kill an amendment by Rep. David Obey (D-Wisconsin) that would have moved $4.6 billion from the bill's Iraqi reconstruction funds to the U.S. military. It also would have canceled income tax cuts scheduled for the wealthiest 1 percent of Americans, enough to raise $87 billion by the end of the decade and pay for the entire bill.

There was also a $100 million for repairing military facilities in Virginia and Maryland that lawmakers said were damaged by last month's Hurricane Isabel.

The bill has $18.6 billion for Iraqi reconstruction, $65.2 billion for U.S. military operations in Iraq, Afghanistan and elsewhere, and $21.6 billion in total reconstruction aid.

The bulk of the money in both categories is for Iraq. The bill includes funds for reconstructing Iraq's water and electricity supplies, oil production facilities, army, police, schools and hospitals.

Leaders of the Senate which is in recess this week, hope to complete work on its version of the bill next week.

A group of Republican senators led by Kay Bailey Hutchison (R-Texas) would structure the assistance as a loan, but Majority Leader Bill Frist (R-Tennessee) has said he believes he can derail that effort.

House and Senate conferees are moving toward providing drug coverage under Medicare, not Medicaid, for beneficiaries who qualify for both programs. Still unresolved is how much the states and the federal government would pay under such a plan.

The House bill would phase in Medicare coverage for the elderly who qualify for both Medicare and Medicaid. Under the House measure, the government would assume state responsibility for those beneficiaries. The Senate version would keep that coverage for those beneficiaries, known as dual eligibles, under Medicaid, but would provide more generous subsidies to help low income seniors afford coverage.

Under current law, Medicaid fills the coverage gaps for low-income Medicare recipients by paying a portion of their outpatient drug costs. The administration wants to keep that approach, but the nation's governors have urged conferees to have Medicare cover dual eligibles.

Covering dual eligibles under Medicare may also help win Democratic suport for the conference package. Proponents of the House plan argue that excluding dual eligibles from a prescription drug benefit would create a two-tiered system under which low-income Medicaid recipients would receive less comprehensive coverage than their more affluent peers.

The Senate is trying to force the hand of House Republicans to accept the Senate’s plan to expand payments to low-income parents under the child tax credit.

Republican leaders have agreed to permit supporters of the Senate version of the child tax credit bill to attach the measure to another bill that would provide new tax incentives for charitable donations. Then the charitable giving bill, which is the remainder of the President “faith-based initiative” would then be sent to conference with the House.

Senator Olympia Snowe (R-Maine), a leading proponent of the child tax credit expansion has been blocking a Senate vote to go to conference on the charitable giving bill in order to try to force movement on the child credit issue.

It is unclear whether the child credit provision will make it in the final version of the chartable giving bill.

On Wednesday, the American Association of State Highway and Transportation Officials (AASHTO) held a news conference on the reauthorization of TEA-21. Earlier in the week, President Bush signed a bill extending surface transportaion programs for five months, while transportation authorizers attempt to draft a long-term bill.

Lawmakers might find it difficult to pass a long-term reathorization bill in the next five months because of time constraints and other legislative priorities. Congress will likely adjourn in mid-late November, which leaves little time left in this session for lawmakers to consider a long-term bill. Congress still has to act on appropriations bills, the President's supplemental funding request for Iraq, the Medicare bill and energy legislation. In January and February, Congress has only 10 legislative days scheduled, so there is scant time to conider a long-term extension bill. However, state transportation departments continue to stress the need for immediate action on a long-term bill, especially in light of state budgetary constraints and increasing congestion on highways.

AASHTO President John Njord commented, "we haven't got five months to create a bill here, folks, we've got a very short period of time." Njord also talked about how crucial it was for the federal government to provide a stable and predictable stream of funding to state transportation departments, who must prepare long in advance for construction projects. With continuous short-term extensions, it will be more cumbersome for states to compare future federal funding of projects with required expenditures. Without definitve knowledge of federal funding for a specific program over a long period, states and regional transit agencies have more trouble estimating how much transportation money must be raised through other means. "When there is uncertainty on the state side.....it really dampens our ability to plan long-term," said Njord.

With the Congressional impasse, AASHTO has recently stepped up its lobbying efforts on Capitol Hill. Even as State DOTs have been hampstrung by state buget woes, the need for more transportation investment has not diminished and Njord wants lawmakers not to lose interest in passing a long-term bill over the next five months. If Congress fails to act before the end of February, another temporary extension will have to be approved so transportation funds continue flowing to the states.

AASHTO wnats Congress to have a bill ready for consideration by Thanksgiving.

On Tuesday, David Gunn, President and CEO of Amtrak, spoke before a packed house at the National Press Club. His speech was titled "The End of Trains or a New Beginning?”

David Gunn has been praised by Amtrak supporters and detractors alike for his year and a half stewardship of the railroad. Even while Congress is still negotiating Amtrak’s appropriation for FY 2004, Gunn continues to implement reform aimed at increasing efficiency and transparency. In the last year, Gunn has testified before some hostile congressional committees, but his candid commentary on Amtrak’s state of affairs and unabashed critique of past failures has earned Gunn the respect of many lawmakers, even those inimical to the plight of Amtrak.

Gunn began his speech by conveying a sense of optimism and then enumerating some of his recent accomplishments at Amtrak. Upon reaching the podium, Gunn stated that he was “optimistic about the future of Amtrak.” According to Gunn, FY 2003 was the first year in which Amtrak had not borrowed money since 1995. Additionally, he stated that Amtrak will likely set a record in ridership this year. Gunn also said that Amtrak’s revenue is starting to improve. In August, revenue and ridership, compared to the same period last year, were 4.8% and 7.3% higher, respectively.

Gunn, who had previous stints at Washington Metro, Philadelphia’s SEPTA and New York’s MTA, told the crowd that “we have begun to address the deferred maintenance problem.” Under the aegis of Gunn, 21 motors and 20 wrecked cars were rebuilt along the Northeast corridor, an inspection facility was re-opened in Chicago, the inspection cycle on equipment and infrastructure was reduced from 120 days to 90 days, and there are plans to replace track this year.

While Gunn conveyed a sense of optimism, he was careful to point out that “we’re making progress, but are not out of the woods yet.” For example, Gunn said that 200 miles of track along the Northeast corridor still needs to be replaced in the near future. However, Gunn maintained that even with such obstacles, he believes that “Amtrak can be effective and work.”

When asked about the privatization of intercity passenger rail, Gunn retorted that those who desire opening the system up to competition have no defined objectives or a transition plan. Gunn elaborated, saying that “in order to privatize an industry, the industry has to be profitable and passenger rail cannot be profitable.”

Commenting on freight railroads, Gunn said that the freight railroad industry is in a period of decline, which presents a problem for Amtrak. Gunn feels the stiff competition in the freight railroad industry has depressed profits, making it more difficult for freight rail operators to invest in new infrastructure. [

Gunn was the most adamant about the need for a stable and predictable source of funding for rail service. Gunn was quite stark in his dismissal of the notion that passenger rail service could be profitable. Gunn then briefly addressed Amtrak’s annual appropriation for FY 2004, which has not yet been determined. If Amtrak receives $900 million, as recommended by the House and Bush Administration, Gunn said that there would be a shutdown of the system. Gunn still maintains that Amtrak needs the full $1.82 billion in federal subsidies that they had originally requested. However, Gunn did agree with the Administration on two important points. First, Gunn agrees that states should pick up the operating deficit on routes they request. Second, Gunn feels that the federal government should provide a capital match for new projects. When asked if he ultimately feels that Amtrak will receive enough money for FY 2004, Gunn replied, “the more we can demonstrate we are stewards of a tight ship, I think we have a good chance of getting adequate funds.”

Gunn concluded his remarks by commenting briefly on high speed rail. “Improvements to passenger rail service must be incremental”, said Gunn. Gunn said that we must look at higher speed rail before looking at high speed rail. Gunn highlighted the TGV high speed rail train in France as an example. “You can’t just look at the TGV in France and say I want that…that was the mistake with Acela,” Gunn stated. Gunn added that high speed rail in Japan and Europe was “evolutionary and not revolutionary.” Gunn went on to candidly state that the Aclela service, Amtrak’s fastest train, will never meet the promises that were made by Amtrak management when the train first debuted. For the time being, Gunn stated, “there will be little change in the speeds of trains that run along the Northeast corridor.”

Speaking concisely on the proposed labor walkout to occur this Friday, Gunn appeared confident that a one-day work stoppage would not happen. A few weeks ago, some unions representing Amtrak workers threatened to shut down the railroad for a day to protest “chronic underfunding of Amtrak by the government.” Gunn said such a move would be unwise and illegal. Amtrak filed a motion with the U.S. District Court in D.C. seeking an injunction to prevent such a work stoppage.

Last week, House Transportation and Infrastrcuture Committee ranking member Rep. James Obertstar (D-Minnesota) and Rep. Tom Petri (R-Wisconsin), chairman of the Subcommittee on Highways, Pipelines and Transit spoke about transportation issues before a Capitol Hill breakfast sponsored by The Hill newspaper. Both Obertsar and Petri supported raising the federal gas tax to increase funding for highway and transit programs over the next six years. The two lawmakers, along with Committee Chairman Don Young (R-Alaska) could not come to an agreeement with the House leadership on raising or indexing the federal gas tax. Because authorizers could not complete work on a long-term TEA-21 reathorization bill, Congress had to pass a short-term five-month extension bill, allowing vigorous debate on reauthoirzation to continue. Congressman Obertsar and Petri made these remarks at the breakfast last week.