PA House Bill 1060 Passes 113-85; Governor Corbett Gets Transportation Bill for Signature, Ending Legislative Parrying on Taxes, Prevailing Wage

Leech Tishman clients whose work intersects with the transportation and public sectors are offered the following update on the General Assembly’s agreement on a long-awaited state transportation bill:

After months of negotiating and lobbying in the House and Senate, on Thursday, November 21, Governor Tom Corbett received a transportation bill for his signature that provides up to $2.4 billion over five years to improve the state’s roads, bridges, and mass transit systems.

After two unsuccessful attempts to pass the bill, the House reversed itself on November 19 and approved it by a vote of 104-95. The amended bill went to the Senate and was passed by a 43-7 margin. The Senate sent the bill back to the House for final approval on November 21 as House Bill 1060. The final House vote was 113-85.

According to one analyst, the bill passed between the chambers was “materially the same as the one the Senate approved back in June.” The biggest difference:  The House changed the current threshold of $25,000 to $100,000 to trigger the prevailing wage requirement, starting in 2014.

Observers noted that after a close committee vote in the Senate, a number of Democrats approved the prevailing wage change only after some unions agreed to it, based on their desire to see workers employed on projects that would be funded only if the bill passed.

Over the first five years of the legislation, the bill would generate revenues that provide roughly:

  • $1.6 billion for highways and bridges;
  • $480 million for public transit (mainly in Pittsburgh and Philadelphia); and
  • $144 million for multimodal projects that connect road and rail infrastructure, for example.

Within these totals, estimated support to local governments for road maintenance is $237 million; for Pennsylvania Turnpike projects $86 million; and repair of dirt and gravel roads $30 million.

Final spending is subject to revenues generated by the state, which are influenced by the wholesale price of gasoline and the collection rate for fees as well as fines for traffic violations. A notional five-year revenue generation plan is available from the House Appropriations Committee here.

Like the original Senate bill, the House version raised revenue mainly by incrementally removing a cap on the oil company franchise tax paid by fuel distributors; this increase is expected to be passed on to consumers. The tax will now be calculated from the full wholesale price rather than part of the wholesale price.

The bill also raises fees by a dollar at a time for vehicle registration and driver licenses. Fines for some moving traffic violations increase by 50%. In addition, the bill allows PennDOT and the Turnpike Commission to establish 70 mph speed limits on highways that meet certain criteria.

Leech Tishman clients are advised that the bill will be implemented over a five-year period. Our team is ready to provide assistance and answer questions on all aspects of implementation that require interaction with local and state authorities and collaborating businesses.

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