Oregon will start receiving smaller payments from the Federal Highway Trust Fund starting in August, according to the state’s interpretation of federal changes announced this week.

That is the plan if Congress does not approve legislation to bolster the shrinking pot of money by the end of July, Oregon Department of Transportation Chief of Staff Travis Brouwer said.

Oregon receives about 1.2 percent of the $2 billion to $2.8 billion in trust fund revenues the federal government distributes monthly. In June, Oregon received $39.8 million in federal funding. This past August, typically the peak month, the state received $69 million.

Now, Oregon is likely to receive between $25.4 million and $35.6 million monthly – a significant drop that could result in between $50 million and $100 million in IOUs from the federal government by the end of November, Brouwer said. ODOT should be able to pay for projects through then, he added.

“We’re hopeful that Congress would take action before August and certainly by the end of November, he said.

Also, the state will , rather than a weekly one, starting Aug. 1, according to a that Transportation Secretary Anthony Foxx sent to state transportation departments on Tuesday. Typically, the Oregon Department of Transportation sends out reimbursement requests on a weekly basis and receives payment the same day.

Oregon is in better position than others states are to handle reduced funding over the next several months because it has dedicated reserves from bond sales that would not need to be spent in the short term, Brouwer said. The state has more cash on hand than most other states, he said.

“It would not affect current projects or contractors working on them or their workers or suppliers,” he said.

In the long term, however, the state would face challenges because it will rely heavily on federal funding as state-funded bonding programs near completion.

“We are more … reliant (on federal dollars) for new projects than most states,” he said. “So we are in a worse position than other states in terms of what we have to do.”

As a result, many federally-funded bridge and paving projects that would otherwise go to bid this fall will likely be delayed without action by Congress, Brouwer said. However, he thinks efforts by Sen. Ron Wyden, D-Ore., to find a short-term Highway Trust Fund patch will be successful before Congress recesses in August.

Wyden, chairman of the Senate Finance Committee, agreed to a downsized $8 billion infusion that would carry the fund at least through the end of the year. Congress is expected to vote on the plan next week.

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With the clock ticking, U.S. Sen. Ron Wyden, D-Ore., is pitching a temporary solution to sustain the nearly depleted federal Highway Trust Fund through the end of the year – or at least through the summer construction season.

The Preserving America’s Transit and Highways (PATH) Act, is subject to a markup session by the Finance Committee on Thursday, which is the last workday before Congress breaks for the Fourth of July recess. It includes $9 billion that would be generated over 10 years from multiple revenue sources; a few would be lowering the threshold for heavy vehicle taxes, spurring tax payments by revoking or denying passports of evaders and requiring distributions of inherited IRAs within five years.

Wyden, who earlier said that failure to find a long-term solution to the transportation funding crisis would be a “tragic mistake,” called his short-term patch “an imperative first step” toward a long-term solution.

With Congress in an election year, Wyden may have had no other choice than to push the can down the road. He said the extra time will help his committee find a long-term plan.

The much bigger challenge appears to be coming up with approximately $89 billion on top of projected revenues to keep the trust fund solvent through 2020, according to the Congressional Budget Office.

That number could easily be plugged by doing the unthinkable – raising the gas tax. A 12-cent increase in the gas tax over two years, indexed over time with inflation, would actually raise $164 billion over the next decade – more than enough to plug the hole, according to a by Sens. Bob Corker, R-Tenn., and Chris Murphy, D-Conn.

That proposal has gained some traction, but faces opposition from anti-tax groups and a skeptical public.

Wyden is to this ongoing problem of highway funding. The test of his political leadership could be finding a solution that is palatable on a national stage.

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State and federal dollars for transportation projects are dwindling, and contractors are noticing.

“It seems like we have not seen the level of highway projects that we’ve seen in other years,” said Dave Jensen, special projects manager in Portland for Bismarck, N.D.-based Knife River Corp. “Our competitor friends are feeling the same pinch.”

Knife River has adjusted by pursuing smaller projects and private ones, Jensen said.

“For our highway construction group, (the impact has) been huge,” he said. “We’ve had to downsize and cut back. A few years ago, we had multiple paving crews. Now we have a hard time keeping one crew busy.”

The situation may worsen. Fewer dollars are expected to come in from state and federal highway fund sources that essentially allow the Oregon Department of Transportation to cover debt service, highway maintenance and personnel.

David Lohman, acting chairman of the Oregon Transportation Commission, stated in a May 28 letter to Area Commissions on Transportation that the state will have to pay $200 million annually for the next 25 to 30 years in overall debt service on its two major investment projects of the past decade – the three-part Oregon Transportation Investment Act and the 2009 Jobs and Transportation Act.

Also, the state’s highway fund in 2013 took in about 11 percent less than originally forecast, according to Lohman.

Meanwhile, the Highway Trust Fund is expected to run out of money by July 17, according to the Congressional Budget Office. If Congress were to do nothing, Oregon would be left with an approximately $150 million annual shortfall.

Sen. Ron Wyden, D-Ore., chairman of the Senate Finance Committee, is seeking a quick funding fix to sustain the federal Highway Trust Fund for six to eight months, said Mike Salsgiver, executive director of Associated General Contractors’ Oregon-Columbia chapter.

“That would get it past the (November) election,” he said.

In the U.S. House, Rep. Peter DeFazio, D-Ore., has introduced the Repeal and Rebuild Act, which would create up to a six-year funding fix. HR 4848 would repeal the gas tax and replace it with an indexed tax on oil (per barrel) that wholesale companies purchase and process into gasoline.

Another proposal, released Wednesday by Sens. Chris Murphy, D-Conn., and Bob Corker, R-Tenn., would raise the federal gas tax by 12 cents a gallon and index the tax with inflation. The federal gas tax, increased to 18.4 cents per gallon in 1993, has not kept up with inflation.

At the state level, a transportation bill likely would not be passed by the Oregon Legislature in 2015, Salsgiver said, because a supermajority would be required. Plus, heavy turnover is expected in the House, and newcomers would need to be brought up to speed on critical transportation issues, he said.

“People are starting to look at what a post-JTA effort would look like, but I’d be very surprised to see it happen in the 2015 session,” he said. “They’ve set the bar very high for a tax increase and it must originate in the Oregon House.”

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Sen. Ron Wyden, D-Ore., is the “” on the fate of a surface transportation bill, according to Senate Majority Leader Harry Reid, D-Nev.

Wyden, chairman of the Senate Finance Committee, has tasked members with finding by the end of the month a bipartisan solution to revive the cash-strapped Highway Trust Fund. The Department of Transportation has said the fund, which relies on shrinking gas tax revenues, will go broke by August; many projects around the nation are in peril.

Failure to devise a solution could cost thousands of construction jobs and lead to devastating results for the industry nationally, including here in Oregon.

Some ideas have been floated around, including a proposal by House Republicans and opposed by Democrats that would eliminate Saturday service for the U.S. Postal Service and use the revenues to fund the Highway Trust Fund for a year.

Another proposal would bring overseas profits back to the U.S. at a lower tax rate, giving the transportation fund a one-time boost. Wyden, in a statement issued last week, said he would not use the repatriation option to divert revenues needed for tax reform.

Sen. Patty Murray, D-Wash., meanwhile, in a speech before Congress on Tuesday. Not surprisingly, the fight appears to be drawn along party lines.

At Wednesday’s “Rally for Roads” event outside the U.S. Capitol, Wyden told a group of roughly 200 construction workers and executives that he was working hard to find a bipartisan solution.

“My position on transportation comes down to this one thing,” he said in a press release. “You can’t have a big-league economy with little-league transportation – it’s just that simple.”

Wyden’s press office said he is still discussing proposals with committee members and not ready to release details of a funding plan.

Transportation leaders are wary of any temporarily solution. A short-term fix, they argue, would leave the nation in the same position shortly thereafter.

But a temporary solution could be the best hope.

It feels, strangely, like we’ve been down this road before. Unfortunately, that is how the U.S. Congress appears to work.

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The federal government needs more time to study how emissions from biomass facilities should be regulated, the Environmental Protection Agency announced today.

The EPA will defer new greenhouse gas permitting requirements for biomass facilities for three years. The federal agency plans to seek an independent scientific analysis on whether facilities burning wood and agricultural waste for energy should be considered carbon neutral, or if those activities have potential climate change impacts.

Oregon Gov. John Kitzhaber on Tuesday announced his first intended actions as governor, one of which is to put biomass boilers in schools. The governor also plans to meet with the EPA next month on potential rules for biomass emissions. Kitzhaber and Oregon legislators have a plan that would use woody biomass from forest thinning operations in eastern Oregon for biomass energy projects around the state. That plan, the , will be presented by Sen. Ron Wyden at the legislature this year.

By July 2011, the EPA plans to complete rulemaking that will defer permitting requirements for carbon dioxide emissions from biomass and other biogenic sources for three years. Before the end of the three years, the agency will issue a second rulemaking that determines how these emissions should be treated under greenhouse gas permitting requirements.

On Jan. 2, greenhouse gases officially become subject to regulation by the EPA under the Clean Air Act. New and upgraded industrial facilities like power plants and refineries will be forced to install technologies to curb greenhouse gas emissions.

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Waves roll into the Oregon Coast on a daily basis, but over time they have begun to break down jetties built to help protect inland channels.

According to the U.S. Army Corps of Engineers, work costing approximately $1.2 billion is needed to repair jetties on the Oregon Coast. Sen. Ron Wyden is calling for the release of money from the Harbor Maintenance Trust Fund, which has more than $5 billion available, to pay for jetty repairs along the coast.

The fund, according to Tom Towslee, state communications director for Wyden’s office, was set up by Congress to pay for dredging and maintenance of harbor channels and jetties.

“It’s not being used. There’s $5 billion sitting there,” Towslee said.

The corps’ calculations are based on what it would cost to build up each of the 11 jetties on the Oregon Coast to their original length. Matt Rabe, spokesman for the corps, said the process to repair the jetties, which were originally constructed by the corps from 1880 to 1970, would take years. He also said the cost could increase over time.

A fully intact jetty funnels water out to sea in a contained area, naturally dredging the channel and keeping it at a depth that allows boats to travel and in out of harbors. A jetty also provides a definable, reliable and stable entrance into a bay.

“Without these jetties there would be no coastal economy,” Towslee said. “These ports mean tourist money, commercial fishing money. No one could get in or out of these ports without jetties, and these towns on the coast rely on these port towns for income.”

A project to restore the north jetty at Tillamook Bay has been under way since fall 2009; construction is set to wrap up in September. The jetty was 5,700 feet long when it was built in 1917; storm damage has since reduced its length by nearly 300 feet. When the project is completed, the jetty will be 100 feet longer.

More than 1,000 30- to 50-ton boulders are being added, and a “bull nose,” or broader tip, is being installed at the end of the jetty to better handle waves resulting from storms. A crane is being used to lift boulders from the bottom of the ocean floor. The boulders, which are considered relic stones, were part of the original jetty construction.

The Tillamook project was paid for with money from the American Recovery and Reinvestment Act.

Rabe said Tillamook’s south jetty and two Coos Bay jetties also need repairs due to decades of storm damage.

The major project most likely to draw the corps’ attention next, Rabe said, involves repairs to the three jetties at the mouth of the Columbia River. Rabe estimated that the work would cost $500 million and require 20 years.

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