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Congress reaches a compromise on transportation bill

$286.5b package seeks to improve roads over 6 years

WASHINGTON -- House and Senate negotiators have agreed to a level of spending for highway and transit project that is acceptable to the White House. The deal clears a major hurdle in the two-year effort to develop a new federal transportation plan.

Negotiators ''have been working on a compromise for a transportation bill that would make much-needed improvements to federal highways," House Speaker J. Dennis Hastert said in a midnight speech on the House floor Thursday. ''Tonight they came to an agreement . . . to move that bill forward."

Hastert provided no details. Congressional aides said the two sides have agreed on spending $286.5 billion over the six-year period ending in September 2009. The aides said the administration would accept that level.

Yesterday, President Bush signed an extension of the old highway program for the eighth time since it expired in 2003. The program was funded at $218 billion over six years.

Congress has been unable to come up with a new bill. That is partly because lawmakers sought a significant increase in spending for transportation projects, drawing a veto threat from the White House over the cost of the bill.

This year the White House has warned that President Bush would veto any bill that went over $284 billion, the level approved in the House bill passed last March.

The Senate in May passed a $295 billion bill, with its sponsors saying they had found ways to increase revenues, by cracking down on tax fraud and other measures, so that it would not add to the federal deficit. Money for highway and transit spending is derived from the highway trust fund, which comes from the federal tax of 18.4 cents a gallon that drivers pay at the gasoline pump.

The latest extension goes through July 19, giving negotiators several weeks after they return from the Independence Day recess to work out details, including the formula that determines how much states get back in federal grants in respect to their contributions to the trust fund.

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