Podcast - Where to Next? Transportation and Infrastructure Priorities in the 118th Congress

Michael Friedberg: Good morning. This is our first attempt at a transportation podcast. Bear with us. I got Laurie Hettinger, who is our expert on all things transportation Senate. She'll introduce yourself and then Joel Roberson, who really focuses on transportation and technology. And I am Mike Friedberg. Do kind of a generalist that does all things transportation as well. I'll start with introducing myself. Mike Friedberg I came to Holland & Knight about seven years ago from The Hill. I was the staff director of the Railroad Pipelines and House Materials Subcommittee of Transportation Infrastructure. Before that, I was on the Appropriations Committee for Transportation, Housing and Urban Development, and I started my government career at OMB, the Office Management Budget. So with that, I handle a lot of transportation issues dealing with railroads, infrastructure, aviation, a lot in the tech space with Joel, [I] do some transit as well. So really, if you say transportation, they usually call me. So with that, Laurie, maybe introduce yourself next.

Lauri Hettinger: Hi. I represent a number of transportation agencies and local governments and airports at Holland & Knight. Prior to joining Holland & Knight, worked in the Senate for ten years and I started as a staff director of the Senate Environment Public Works Highways and Infrastructure Subcommittee, Joel.

How Committee Leadership Changes Will Impact FAA Reauthorization

Joel Roberson: Hey, everybody. Joel Roberson I am a partner here at Holland & Knight, have been at the firm for 15 years and my practice focuses on representing emerging technology companies that are disrupting the transportation sector. So drones, autonomous vehicles, electric vehicles, electric aircraft, technology of that nature. So with those introductions aside, why don't we go and dive in talking about transportation in 2023. So obviously there is a big midterm election. So we'll dig into what that means for the leadership on transportation issues going forward. So with the win by Senator Warnock in the Senate, Democrats take an extra seat more than what they had last year or the current year, which means that has practical implications for how the committees are going to take up transportation issues, because the balance on committees will shift and Democrats will have a majority in committees which will allow them to have an ability in the Senate to move things with their own party's votes, although a lot of transportation issues ultimately end up being bipartisan. So let's dig into that a little bit more, Mike and Lauri, do you guys want to talk a little bit about, you know, the Senate Commerce Committee. Obviously, they have jurisdiction over a lot of transportation issues. There's an FAA reauthorization coming up. We have Maria Cantwell, who was the chair, will continue to be the chair. But Ted Cruz. Mike, what do you think about the change that will happen when Ted Cruz takes over the ranking slot on the Commerce Committee?

Michael Friedberg: Well, you know, you're going from Roger Wicker, who was very, very bipartisan, outwardly and inwardly and great staff. I do not think the staff will be changing. I mean, the people will change, but their perspectives are going to stay the same where a lot of transportation is, you know, I don't say bipartisan bipartisanship, I say post-partisan, really, right. There's no, you know, the classic line is there's no Republican bridge or Democratic bridge. So with that reauthorization, I do think the staff will work together. It's going to be interesting to see if Senator Cruz is running for president. What his posture is in working in a bipartisan manner. So that's the interesting part where you're really going to have to get in with members of the Commerce Committee to see where they land on the issues. Senator Cantwell is also she is, I would say. There's going to be more fights outwardly. Now, I don't know what that means inwardly. Especially now that the Senate Commerce has, there's going to be a majority of Democrats on the committee. So there's not going to be as many fights over nominees because it's going to be party line votes. But what does that mean for legislation? Lauri worked in the Senate, so probably her perspectives would be better than mine.

Lauri Hettinger: So I think one good thing about the FAA reauthorization that the Senate and the House have started considering this year, but are trying to get it done next year is that it's a bipartisan issue, is rather than focusing on, you know, Republican or Democrat talking points. Members really is based on a regional perspective. So, [it] is based on what the airports in your district or state care about if you're in an urban or rural area. That is really how members look at it versus that typical Republican Democratic debate.

[It] is based on what the airports in your district or state care about if you're in an urban or rural area. That is really how members look at it versus that typical Republican Democratic debate.

Michael Friedberg: And just adding on that and moving a little to the House, but a lot of it is going to be bucking their party majority or party ethos of, hey, we can't work with the Democrats, the adversarial nature that the Congress has been in. You know, when T&I worked on The Hill, it was more T&I versus the majority leader and the leadership of getting bills done in the conservative caucus versus the Democrats. So with FAA reauthored, [I] already heard that's going to be a challenge, not the Democrats per se, but more just how are we going to get it to the floor.

Senate EPW and Banking Committee Leadership Changes and Goals

Joel Roberson: Thanks Mike, thanks Lauri. And just to round out the Senate leadership on transportation issues. The Senate EPW Committee is going to stay relatively constant from the leadership perspective, but Senate banking is going to have some changes. Lauri, do you want to just break down how the EPW and Banking Committee will shake out next?

Lauri Hettinger: Sure. So, Joe, as you just said, this EPW leadership will stay the same. Senator Tom Carper of Delaware will remain the chairman and Senator Capito of West Virginia will remain a ranking member. They work really well together. They got their legislation done this Congress, the Transportation Authorization bill. So they should be focusing more on oversight this upcoming Congress. Senate Banking, Senator Toomey of Pennsylvania retired. So there is several members vying for that. The most likely Senator Tim Scott of South Carolina will become the ranking member and Senator Sherrod Brown of Ohio will stay the chairman.

They should be focusing more on oversight this upcoming Congress.

Michael Friedberg: And why it's important for lobbyists like us is with the change in leadership and change and staff as well. So educating folks on the Banking Committee, it's kind of weird that transit is in the banking space, but it is. So I already know that the former Toomey staff is leaving, trying to figure out who the new staff and educating them is. It's going to be important for months in January and February.

House and Senate Positions in the Transportation, and Housing and Urban Development Subcommittee

Joel Roberson: Yeah, that's great. And the other key transportation committee is, of course, the appropriations side of the equation in the Transportation, and Housing and Urban Development Subcommittee (THUD), where there's going to be changes on both the House and Senate side. So maybe we'll use that. [Let's] start with the Senate and then bridge over to the House changes. But Mike, do you want to talk a little bit about Appropriations Committee leadership on that?

Michael Friedberg: Yeah. So [it] is my understanding that Senator Schaaf from Hawaii is staying as THUD chair. The interesting is Senator Collins has been there for, I don't know, 12 years as the THUD chairman, and she is now going to be the ranking member of the full committee. So I think she is going to move off of THUD. Historically what happens is that Collins will become chair of events subcommittee. So there will be new leadership. We're hearing it's Boozman from Arkansas. Very, very good senator, very good person on staff. But will the staff change with him? Historically, it will. So we're all still kind of waiting to see. The hard part of where we are now is people are interviewing for jobs, people are trying to pass last minute legislation. So it's still a lot up in the air. On the House side, the Congresswoman Granger will be full committee chair, Congressman Diaz-Balart from Florida, he has been there for the last eight years. He got a waiver last Congress to be ranking member. What does that mean? If he does not get another waiver, he is seeking another waiver. If he doesn't and it really is up to the conference, Republican conference, you're going to see a lot of dominoes go because he might go to foreign ops. Tom Cole is in next in line, but he has Labor H. So it's going to be really interesting to see who gets THUD or T-HUD next Congress to be the chair. It's usually a very moderate Republican because they really work across the aisle. I will say Mario Diaz-Balart and Chairman Price, David Price, who is retiring, work really well together. The staff like each other. They try to do things bipartisan. If they aren't bipartisan, they really respect why people are doing [things] the way that they're doing it. Mike Quigley from Illinois kind of follows that mold. You know, big hockey player, kind of Midwest, likes to compromise, likes to get things done. So I see that spirit holding over. But you never know. It depends on where we get on the Republican side.

The staff like each other. They try to do things bipartisan. If they aren't bipartisan, they really respect why people are doing [things] the way that they're doing it.

Leadership for the Transportation Infrastructure Committee & Energy Commerce Committee

Joel Roberson: So then, on the authorizing side on the House, we're going to have a big change on the T&I Democratic leadership with Peter DeFazio retiring. There is a competitive race there between Rick Larson and Eleanor Holmes Norton to take over the Transport Infrastructure Committee. Right now, the expectation is that Rick Larson will win that race and that decision will be made the week of December 12th. So we should know soon who is who will take over the ranking Democratic side. Sam Graves will remain the top Republican, but will move from ranking member to chair, and that will be a critical relationship between the two of them as they embark on an FAA reauthorization, which we talked about a little bit earlier. And we'll dig into a little bit deeper in a minute. As it relates to roadway safety, there is the Energy and Commerce Committee has jurisdiction over the National Highway Traffic Safety Administration and things like autonomous vehicles. That leadership on that committee is expected to stay the same with Frank Pallone, Democrat from New Jersey, and Cathy McMorris Rodgers, Republican from Washington, maintaining the lead they have. While their politics are very different, [they] have been able to work together on legislation. So the continuity there should be helpful for legislative efforts in 2023. So now that we have an idea or at least a good sense of who's going to be sitting in which chairs as we head into 2023, let's dig in to what the leadership in each of those positions is going to use that position to enact the type of legislation they're going to enact. So House Republicans obviously are taking a lead, but a very slim majority in the House and are laying out their legislative agenda. Lauri, do you want to talk a little bit about what we expect Republicans to focus on as they take over the gavel?

While their politics are very different, [they] have been able to work together on legislation. So the continuity there should be helpful for legislative efforts in 2023.

What Are the House Republican Legislative Agendas for 2023?

Lauri Hettinger: Yes. Thanks, Joel. And then, Mike, please add on, since you used to work on the committee a few years ago, they have said that they are going to focus on oversight and investigations. And I believe they're going to investigate how local governments, transportation agencies and states are utilizing their bipartisan infrastructure bill. They are otherwise known as the investment infrastructure in job act funding. And they're also going to look at how they're utilizing they're public money to. Mike, I know you've been talking to the committee staff frequently what else have you been hearing?

I believe they're going to investigate how local governments, transportation agencies and states are utilizing their bipartisan infrastructure bill

Michael Friedberg: You're right, implementation of IFJ it's going to be kind of top of mind first. It's going to be interesting T&I, there's a lot of new members. So the first couple, it is like educating folks on what infrastructure is. A lot of people don't know what goes into all this money and to do the oversight, we're going to have to educate some members. Second, inflation, inflation, inflation. That is a hot button political issue. T&I think that they do have jurisdiction over that, especially in the projects costs and how that's implemented. So those two things are going to be big, like they're going to be overseeing Amtrak, transit entities and how DOT is spending the money. So a lot of the folks voted for the IIJA and like it in spirit, but do not agree with how DOT is actually spending the money. So you're going to see a lot of oversight and it's going to be a weird posture where DOT and the entities are going to be a little defensive. So the interactions are going to be very interesting between the members. Sam Graves is a really moderate guy in transportation. In other issues, he's conservative, but he really wants to get stuff done. He works well with the Democrats. DeFazio who is retired, spoke well of them. So in the mold of the former T&I chairs, I think they're going to try to get stuff done, but it's going to be really hard to get legislation done. So they're going to really focus on oversight and investigations. You're right. They're going to have to do some red meat stuff for the conference. And companies especially that are getting money from these entities should really educate the folks up there on why this is important, how many jobs are getting created because of this infrastructure and how that's changing the economy in especially rural districts.

Drone Industry, Pipeline Reauthorization and Other Priorities

Joel Roberson: And also, I would just add in that be really careful about how you're executing on the funding that you've received from the IIJA or the IRA, because you don't want to be the recipient of a letter asking you to come up and defend decisions that you made. If you are going out on the limb about how that money can or should be spent, there's going to be oversight and investigation. But there also is going to be a number of bipartisan bill this week alluded to in the past with digging a little bit deeper there. So FAA reauthorization is due, the current authority for the FAA expires on September 30th of 2023. Congress intends to get a fast start on trying to get that legislation done before its current authority expires. In the past, there's been a track record of requiring extensions. So in order to avoid an extension, they will have to make sure to work deliberately with some hearings quickly in the new year and then legislative drafting markup and main topics. There's lots of topics that come up every cycle, but maybe we can unpack a little bit. I'll start with those items. In my area of expertise, there's likely to be a title or two in the bill about emerging aviation technologies for things like advanced air mobility, electric and hydrogen propulsion aircraft. There's also unmanned or uncrewed aircraft that continue to be integrated into the national airspace system. And there's lots of interest by the drone industry to come up with changes to FAA's authority that would allow for aircraft certification and operations in the United States to be more flexible and keep up with the international trends towards allowing more flexible operations. So there's inevitably going to be language on those topics. There also was federal authorities at the Department of Justice and Department of Homeland Security to track and mitigate drones that may be causing a risk, counter UAS authorities that were extended this year that will have to be addressed in a full reauthorization. That's expected to ride with the FAA reauthorization as well. But Lauri and Mike, you want to break down some other topics?...

Congress intends to get a fast start on trying to get that legislation done before its current authority expires.

Michael Friedberg: Well, you know, I do want to unpack the drones is not just the technology of the drones. A lot of infrastructure providers like utilities, railroads, pipelines, they use drones or they want to use drones more. So you're going to see authorities on, you know, the technology for the drone providers in the counter... But you also, you know, a lot of the traditional infrastructure folks that are always on T&I, the historical players, they really care about those issues, too. So we're hearing a lot of "Alright what do we need to get into the FAA bill so we can fly a drone so we could do this?" That involves labor issues, that involves a lot of state and local issues. So it's all encompassing, if you think about it, is not just, hey, how do we get more, how do we get more in line with the international successes? So it's going to be super interesting of how the players align, as we saw from last one. Historical partnerships or historical agreements did not really, it was kind of new coalitions that were made. So other than that or we're going to see pipelines. Nobody really ever thinks pipeline reauthorization until there's an accident. It is expiring last in 2018. It was bipartisan, a pretty good bill. The last two bills have kind of moved the needle. And so this is just going to be another one of, though, a lot of fuel providers, oil and gas. They care. It's the midstream, it's the transportation. Why it's weird this year is the Democratic Party has used the pipeline safety as an environmental, they're trying to put the environment in the pipeline safety bill where that has historically just been a safety bill, not using the environment for an EPA bill or something like that. So it's going to be interesting what [the] Biden administration proposes in that space. That's all I see really coming down the pike and a water bill maybe. And that's it.

That involves labor issues, that involves a lot of state and local issues. So it's all encompassing.

Joel Roberson: I can't believe we went this far into the conversation without getting to Pipeline. So thank you for highlighting...

Michael Friedberg: Yeah there, hey,  is you know the everybody forgets about them.

Lauri Hettinger: The only think I was also going to add, that airports contain what they want to increase the PFC charge. Airlines remain opposed to that. There will still be a discussion on that and also getting more funding into the contract tower program. The other, I think discussions went spruced up.

How Will Both Parties Negotiate a Final Appropriations Bill, and What Impact Will This Have On Grant Funding?

Joel Roberson: Thanks, Lauri. And when we think about appropriations, just to round out the congressional priorities and before we turn to the administration and what the administration's expected to focus on. The appropriations process, of course, is an annual process that will require bipartisan support. Even though Democrats are in a 51-49 majority in the Senate, any appropriations legislation would require them to get to 60 votes to move it to that legislation. The parties will have to figure out, with the new Republican leadership in the House how they negotiate a final appropriations bill. And that will impact some of the topics that we've talked about in terms of how much funding would go towards some of these authorization bills, including some of the authorizations like IIJA and IRA, which have already been authorized and portions of it have already been appropriated. But the ongoing implementation will require additional appropriations, which Republicans will likely have some significant questions about how much they want to invest there. Mike, you want to talk a little bit about how the appropriations process might impact your grant programs going forward?

But the ongoing implementation will require additional appropriations, which Republicans will likely have some significant questions about how much they want to invest there.

Michael Friedberg: It's going to be very interesting. A little palace intrigue, they're trying to get the appropriations done. There'll be an extension until the 23rd. You got to realize the committees on, especially the House side, they shrink for the Democrats. So all those people are looking for jobs and negotiating. It's super, super hard to do. The Republicans are looking for people to work for next year. So there's not an appropriations bill this year that goes next year. They're going to be doing two bills looking for people. It's a mess. How I know this is I did this in 2011. We did the exact same thing where we had a bill done for the current year in February. Then we went to the next bill. So what I would do is get in early. And get in often as much as possible to educate these folks. A lot of these staff, especially in the transportation world, will not know appropriations. So you got to really get in and educate them and get your priorities stated. So I do think it'll happen. It's going to be very interesting to see if everybody can get top line numbers where the president comes down with inflationary costs. The weird part of transportation for appropriations, it's stuck with housing. Housing has huge inflationary costs and public housing is billions and billions of dollars. So that sometimes feeds into the FAA, FRA and the other traffic in the highways, portions of the THUD bill. So you really, really got to fight to get your priorities in now.

So you really, really got to fight to get your priorities in now.

The Biden Administration and Implementation of the Infrastructure Bill and Inflation Reduction Act

Joel Roberson: Thanks, Mike. So turning to the administration, we're heading into the second part of the first term of President Biden's presidency. And as is usual, we would expect to start to see some turnover in some of the top political positions in each of the agencies, including those that have jurisdiction over transportation. So it will be interesting to see how that impacts agencies like DOT, whether Secretary Buttigieg stays in that position, whether he starts making moves to run for president in 2024, will certainly impact the leadership and policymaking that comes out of that agency. And when we think about some of the when Congress is divided and it may be more difficult for the president to achieve his agenda through Congress after having had Democratic majorities and the ability to pursue budget reconciliation bills over the last two years. If he believes that he won't be able to get his agenda through Congress, then we will likely see an uptick in the regulatory work of the administration. So this will impact things like environmental permitting for projects. They there is a corporate average fuel economy CAFE standards which is underway for vehicles which for passenger vehicles, model year 2027 and beyond, which the Biden administration will likely try to cement before the end of the first term. And so we'll see some activity there. And there's a whole host of other rulemaking that we expect. But Lauri, do you want to break down a little bit about other efforts like continued IIJA, the uptake on IRA implementation and how that would impact transportation sector?

If he believes that he won't be able to get his agenda through Congress, then we will likely see an uptick in the regulatory work of the administration.

Lauri Hettinger: Sure. Yes. So I still have the bipartisan infrastructure bill, IIJA. DOT did a great job in setting up the programs that were created in this bill very quickly. The great thing about this bill, it is it has mandatory funding for all these programs. So DOT will continue to issue notice of funding opportunities no-vo's (?) Early next year for the programs that were created in the bill. And they have said that now that they have stood up the programs, they're going to get out the no-vo's(?) as quickly as they can in January and February. They've already issued two no-vo's (?) for the for the second round of funding, the airport terminal modernization and raise over the past couple of months. The Inflation Reduction Act, which Congress passed in August, creates a billions and billions of dollars of new programs. DOE and EPA have started issuing RFI's to get ideas and recommendations on how these programs should be implemented. DOT should be doing it as well.

Joel Roberson: Great. Thanks, Lauri. So to wrap up, we expect 2023 to be an extremely busy year for the transportation sector across all modes of transportation, with a couple of key reauthorizations and new leadership which will reinvigorate the work that each of the committees are doing in this space. And we expect the Biden administration to continue to lean in following the bipartisan infrastructure law and continue to focus on improving infrastructure across the country. We thank you for joining us today and we look forward to both working with Congress on a bipartisan basis and with many of you in the transportation sector to help achieve priorities that you have before Congress and the administration. Thank you for joining us and thank you, Mike and Lauri, for the conversation.