Following are overviews of the budget requests for various federal departments and agencies.

February 2012 President Obama Releases FY 2013 Budget Proposal President Obama February 13 released a $3.8 trillion Fiscal Year (FY) 2013 federal budget proposal which includes $1 trillion of cuts in discretionary spending over the next 10 years, as mandated by the recently passed Budget Control Act. In addition to the obligatory cuts, the President s budget includes over $3 trillion in deficit reduction over the next decade. The President says his budget proposal will spur job creation and economic recovery. The budget allocates more than $350 billion in short-term measures for job growth starting in 2012, including many portions of the Administration s American Jobs Act, proposed last year, such as extending pay roll tax cuts and unemployment benefits until the end of 2012 and investing in local communities and small businesses. Congress has not passed the American Jobs Act. Following are overviews of the budget requests for various federal departments and agencies. USDOT Budget Includes Six-Year Surface Transportation Reauthorization Proposal, Focus on Sustainability through Livability Programs For the US Department of Transportation (USDOT), the President s FY 2013 budget request proposes $74 billion, which is a two percent increase from FY 2012. The core of the President s USDOT budget proposal is a six-year, $476 billion surface transportation reauthorization. The reauthorization is fully paid for from savings captured by ending overseas military operations in Iraq and Afghanistan. Highlights of the proposed six-year reauthorization include: $305 billion for the Federal Highway Administration, which is a 34 percent increase over the last reauthorization. This includes a $42.6 billion allocation for FY13. $108 billion for the Federal Transit Administration, including $10.7 billion allocation for FY13. $4.8 billion for the Federal Motor Carrier Safety Administration, including $580 million for FY13. $7.5 billion for the National Highway Traffic Safety Administration, including $981 illion for FY13. $47 billion for the Federal Railroad Administration which will go toward funding a National high-speed rail network and existing Amtrak rail corridors. This includes $2.5 billion for FY13. $3.4 billion in National Infrastructure investments, which includes $500 million for FY13. The President s budget request also includes $15 billion for the Federal Aviation Administration in FY 2013. The proposal would increase efficiency and eliminate redundant bureaucracy by consolidating 55 separate duplicative highway and transit programs into five core programs. In furtherance of the Administration s livability initiatives, included in the USDOT budget is a request of $4 billion for formula and competitive grant programs to establish place-based planning, policies, Page 1

and investments to help communities increase transportation choices and access to transportation services. The USDOT budget proposal is available at: http://www.dot.gov/budget/2013/dot_budget_highlights_fy_2013.pdf. HUD Sustainable Communities Programs FY13 Budget Request Continues Administration Focus on Sustainability The Department of Housing and Urban Development s (HUD) FY13 budget request restores funding, about $100 million, for the Sustainable Communities grants program. Sustainable Communities grants are part of a silo-breaking, interagency Partnership for Sustainable Communities with the Environmental Protection Agency and the Department of Transportation that embodies the President s commitment to being a new kind of federal partner to states, regions and localities. These grants are helping metropolitan and rural communities undertake a new wave of transportation zoning, building code and land use reform, and aligning housing and transportation investments so that they can be responsive to the needs of regional economies. According to the Administration, this is particularly critical at a time when the average household is paying 52 cents of every dollar it earns on housing and transportation and when congestion on our roads is costing us five times as much wasted fuel and time as it did 25 years ago. The HUD budget request also provides funding of approximately $2.95 billion for the Community Development Block Grant (CDBG) program. The full HUD budget proposal is available at: http://portal.hud.gov/hudportal/documents/huddoc?id=combbudget2013.pdf. EPA FY13 Budget Sees yet another Decrease The Administration proposed a budget of $8.3 billion for the Environmental Protection Agency (EPA) for FY13, a decrease of 1.2 percent below FY12 enacted levels. The majority of the proposed cuts come from reductions to the state revolving fund programs that fund drinking water and wastewater infrastructure projects. The Administration s request includes $1.18 billion in funding to the Clean Water State Revolving Fund, a 19.8 percent reduction from FY12, and $850 million to the Safe Drinking Water State Revolving Fund, a reduction of $68 million from FY12 levels. These funding levels take the program back to 2006-2009 funding levels. The proposal also allocated an additional $15 million to restore the Chesapeake Bay watershed and an additional $300 million for improving the Great Lakes. While the budget proposal also includes a reduction in funding levels by approximately $25 million for various climate related programs, the Administration maintains that it will stay on track to meet the commitments it made during the 2009 climate talks to reduce greenhouse gas emissions by 17 percent from 2005 by 2020. State and tribal programs that implement air and water regulations saw funding levels that were slightly increased by approximately $113 million over current levels. Superfund programs funding levels are reduced by $33 million and indoor air quality programs to monitor indoor radon would be terminated. The proposed EPA budget is available at http://www.whitehouse.gov/sites/default/files/omb/budget/fy2012/assets/environmental.pdf. Page 2

Army Corps FY13 Budget Focuses on Waterways Transportation & Environment The FY13 budget request for the U.S. Army Corps of Engineers calls for $4.7 billion in funding targeted at the nation s busiest coastal ports and inland waterways. The Administration s request is a 5 percent decrease from FY12 enacted levels. The proposal allocates approximately $1.6 billion for high return construction projects for flood and storm damage reduction projects, commercial navigation and ecosystem restoration. The budget also includes $205 million to support Corps regulatory activities that affect navigable waters and wetlands and calls for a greater focus on high priority ecosystems such as the California Bay Delta, the Chesapeake Bay, the Everglades, the Great Lakes and the Gulf Coast. The proposed Army Corps budget is available at: http://www.usace.army.mil/missions/civilworks/budget.aspx USDA Conservation Programs Take Hit, Rural Development Programs Stay Level in FY13 Budget The Administration s budget proposal for the US Department of Agriculture (USDA) calls for the elimination of annual farm subsidies, a reduction in the number of acres that can be enrolled in the Conservation Reserve Program (a successful program that pays farmers for taking environmentally sensitive lands out of production) and elimination of funding for the Wetlands Reserve and the Grassland Reserve Programs. The USDA conservation programs help farmers deal with the consequences of non-point source pollution thereby limiting the pressure on urban utilities to deal with nutrient pollution through expensive infrastructure solutions. The proposal also strives to contribute to the job creation and economic growth goals of the White House Rural Council by continuing to fund programs that effectively promote renewable energy, job training, infrastructure investment, access to capital, worker training and green jobs throughout rural America by directing approximately $2.4 million to the Rural Development program at USDA. The Administration request also directs funding to programs that conserve landscapes and promote outdoor recreation in national forests and on working lands through the America s Great Outdoors initiative. The USDA budget proposal is available at: http://www.whitehouse.gov/sites/default/files/omb/budget/fy2013/assets/agriculture.pdf President Unveils $39.5 Billion Budget for Department of Homeland Security The proposed FY13 budget for the Department of Homeland Security (DHS) includes $39.5 billion net discretionary funding, which is 0.5 percent below the FY12 enacted level. The FY13 budget prioritizes the mission areas outlined in the Department s 2010 Quadrennial Homeland Security Review and the 2010 Bottom-Up Review. The DHS budget proposal seeks to prevent terrorism and enhance security; secure and manage borders; enforce and administer immigration laws; safeguard and secure cyberspace; and ensure resilience to disasters. The budget proposes $2.51 billion for the National Protection and Programs Directorate, which leads the protection and risk reduction for the Nation s physical and virtual critical infrastructure and key resources from man-caused disasters, natural disasters and other catastrophic incidents. Page 3

In other highlights, the budget: Proposes $13.55 billion, a decrease of $364 million, for the Federal Emergency Management Agency; Proposes $2.9 billion for State and Local Programs, $1.63 billion increase fromfy12 enacted level. These grants provide training, exercise and technical assistance to improve emergency planning, response and recovery efforts; Proposes $5.5 billion for the Disaster Relief Fund, an increase of 3.7 billion. The Disaster Relief Fund provides a portion of the total federal response to victims in declared major disasters and emergencies; Proposes $3.38 billion mandatory funding for the National Flood Insurance Fund, an increase of $277.2 million. The National Flood Insurance Fund provides necessary resources to operate the National Flood Insurance Program. Proposes $89.3 million for the Flood Hazard Mapping and Risk Analysis Program, a decrease of $8.3 million For additional information, go to: www.dhs.gov. House and Senate Debate Transportation Bills The Senate and House of Representatives this week are debating separate versions of bills to reauthorize federal surface transportation programs. The Senate bill, S1813, Moving Ahead for Progress in the 21 st Century (MAP-21), is a two-year, $109 billion bill. The House measure, HR 7, the American Energy and Infrastructure Jobs Act, is a five-year, $260 billion authorization. The highway provisions of the Senate bill, approved by the Senate Environment and Public Works Committee, are the underlying measure for debate of the Senate bill. Finance, transit and motor carrier provisions drafted by separate Senate Committees will be added as amendments to make up a complete reauthorization package as the Senate considers the legislation. The Senate bill s finance provisions include a number of offsets and transfers to close a $12 billion funding shortfall to pay for the bill, including $3 billion from the Leaking Underground Storage Tank Trust Fund and $4.7 billion from a change in tax law governing distribution of inherited IRA accounts. The House and Senate bills differ in many details, but both bills contain no earmarks, consolidate or eliminate as many as 60 to 70 programs, and include provisions to expedite project delivery. The House bill, in addition, includes provisions directing certain revenues from expanded oil and gas drilling and offsets from changes to federal pensions to help pay for the bill. It also includes provisions to eliminate the Highway Trust Fund s mass transit account and direct funding transit receives from a portion of the gas tax, instead funding transit through a new Alternative Transportation Account with $40 billion from the general fund. The Obama Administration said it would veto the House bill. The House transportation portion of the bill emerged out of a contentious Committee markup that lasted 18 hours and addressed nearly 100 amendments. The transportation provisions, energy production provisions and the federal pension provisions will be voted on separately on the House floor and then combined as one package before being sent to the Senate. Nearly 300 amendments have been filed for floor debate in the House. Page 4

House and Senate leaders had intended to hold final votes on their respective bills before the end of the week, when Congress is scheduled to begin a week-long recess. House Speaker John Boehner announced February 15 that a final vote would not occur until after the House returns from the recess the week of February 27. It is unclear whether the Senate will have enough time to complete debate and hold a final vote on its bill before the start of the recess. Once bills are approved in the House and Senate, differences between them will need to be reconciled in a conference committee and one bill signed into law before March 31 to avoid another extension of the expired SAFETEA-LU. Senate s Transportation Bill Includes Key Complete Streets & PAB Provisions Two key provisions with special interest to APWA members, a lifting of the cap on private activity bonds for water and wastewater utilities and complete streets provisions, were included in the Senatecommittee passed version of the transportation reauthorization bill. The Senate proposal includes the Sustainable Water Infrastructure Investment Act that would encourage private investment in water infrastructure projects by removing state volume caps on private activity bonds for water and wastewater financing. The language will allow water and wastewater systems easier access to capital. The Senate bill also includes bipartisan complete streets language that would require states to think about the safety of all users of the transportation system in every project. At this time, neither provision is included in the House version of the transportation bill. President Signs FAA Authorization Bill President Obama signed into law February 14 a four-year, $64 billion Federal Aviation Administration (FAA) reauthorization bill. The Senate cleared the conference report February 6 following House action February 3. Congress extended FAA programs 23 times as result of disputes over labor and other provisions. The measure, HR 658, the Air Transportation Modernization and Safety Improvement Act, provides current funding levels, $3.3 billion annually, for the Airport Improvement Program, which funds airport construction. USDOT Announces New Round of TIGER Program Grants The US Department of Transportation has announced the availability of funding for transportation projects under a fourth round of TIGER (Transportation Investment Generating Economic Recovery) Discretionary Grant program. TIGER 2012 will make $500 million available for surface transportation projects having a significant impact on the nation, a metropolitan area or region. The previous three rounds of the TIGER program provided $2.6 billion to 172 projects in all 50 states, the District of Columbia and Puerto Rico. Demand for the program has been overwhelming, and during the previous three rounds, the Department of Transportation received more than 3,348 applications requesting more than $95 billion for transportation projects across the country. Page 5

As in previous rounds, high-speed rail and intercity passenger rail projects remain eligible for funding. TIGER 2012 provides for the possibility of up to $100 million being used toward these projects. TIGER 2012 will also continue to encourage the development of transportation projects in rural areas, providing $120 million for rural Projects will be evaluated on primary criteria that include safety, economic competitiveness, livability, environmental sustainability, state of repair and short-term job creation. Pre-applications are due February 20 and applications are due March 19. For more information visit: http://www.dot.gov/tiger/ FTA Issues New Starts/Small Starts Guidance The Federal Transit Administration (FTA) has published a rulemaking notice to propose a new regulatory framework for FTA s evaluation and rating of major new transit investments seeking funding under the discretionary New Starts and Small Starts programs. The notice was published concurrently with a notice of availability of proposed guidance that proposes new measures and methods for calculating the project justifications and local financial commitment criteria specified in statute and the proposed rule. Comments are due March 26. The New Starts and Small Starts programs are FTA s primary capital funding programs for new or extended fixed guideway and bus rapid transit systems across the country, including rapid rail, light rail, commuter rail, bus rapid transit and ferries. The proposed rule was the subject of an Advance Notice of Proposed Rulemaking (ANPRM) issued on June 3, 2010, which posed a series of questions about the current regulation, and in particular about three of the criteria used to assess project justification. For more information visit the January 25th Federal Register under Federal Transit Administration, http://www.gpo.gov/fdsys/browse/collection.action?collectioncode=fr FTA Announces $826 Million Discretionary Funding for Transit Vehicles and Facilities The US Department of Transportation has announced the availability of $826.5 million in Fiscal Year 2012 discretionary funds to modernize and repair transit vehicles and facilities and promote the widespread use of sustainable clean fuel. The notice of funding availability, http://www.ofr.gov/ofrupload/ofrdata/2012-02752_pi.pdf, invites competitive proposals for three of the Federal Transit Administration s (FTA) top policy priorities through the discretionary Bus and Bus Facilities and Clean Fuels grant programs, all subject to funding availability, as follows: State of Good Repair; Livability; and Clean Fuels. The public announcement of recipients receiving funds will likely be made in July 2012. A complete schedule of FTA s upcoming discretionary programs, along with details on FTA s FY2012 apportionments, may be found http://www.gpo.gov/fdsys/pkg/fr-2012-01-11/pdf/2012-249.pdf. House Homeland Security Committee Chairman Releases Priorities for 2012 Rep Peter King (R-NY, 3), Chairman of the House Homeland Security Committee, on February 9 released a list of his legislative priorities during the second session of the 112 th Congress. Page 6

King s priority list predominantly focuses on investigating radicalization within the Muslim-American community, studying Iran s intelligence services and examining potential leaks of classified counterterrorism operations. The Chairman also highlighted the importance of studying security preparations for the 2012 Summer Olympics, examining emerging threats to the United States and the Department of Homeland Security s operations, policies and programs. For additional information go to: http://homeland.house.gov/press-release/chairman-king-outlines-key-priorities-2012. Conference Committee Negotiates Tax Bill Containing Broadband Spectrum Allocation Provisions A Conference Committee of Members of the House and Senate are currently working to reconcile the Temporary Payroll Tax Cut Continuation Act of 2011 (H.R. 3630), which contains a provision to establish an interoperable broadband emergency communication network for the public safety and first responder communities, Title IV: Jumpstarting Opportunity with Broadband Spectrum Act of 2011. APWA is seeking Congressional support for changes in Title IV that would identify public works as part of the emergency communications network; eliminate provisions requiring a giveback of narrowband and guard band spectrum; and increase funding to build out the interoperable network from the bill s current $6.46 billion to $11 billion. The Conference Committee has less than three weeks to negotiate the provisions of the bill, as the current short-term payroll tax extension expires on February 29 th. US Trade Representative Studying E-Waste Exports The US International Trade Commission is undertaking a study on the export of used electronics. The National Strategy for Electronics Stewardship, which was developed by an interagency task force, sets forth a series of recommendations for better management of electronics throughout product life cycles. One of the recommendations in the Strategy is to improve information on trade flows of used electronic products. Once the study is completed, USTR will prepare a report that describes US exports of electronic products, including descriptions on the different ways used electronics are collected for reuse and recycling. The USTR has approached APWA to help them in identifying collection and recycling programs by public works departments and the partner contractors that process or transfer these wastes. If you have information to share, please send your information to Julia Anastasio, Director of Sustainability, at janastasio@apwa.net. Page 7