On Tuesday, Rep. Paul Ryan (R-WI) and Sen. Patty Murray (D-WA) announced a preliminary budget agreement that would replace the discretionary budget caps for Fiscal Year (FY) 2014 and FY 2015 established in 2011 as part of the Budget Control Act (BCA).The deal replaces approximately half of the sequestration cuts to non-defense discretionary for FY 2014 and approximately a quarter in FY 2015.  Under the Ryan-Murray proposal, the new non-defense discretionary budget cap would be $491 billion for FY 2014 (an increase of $22.4 billion from the BCA level) and $492.4 billion for FY 2015 (an increase of $9.3 billion from the BCA level).

The current funding for the federal government expires on January 15, 2014, and Congress must still reach an agreement on funding for the remainder of FY 2014 once both chambers of Congress pass the budget agreement. Federal spending for highways is currently being funded at the FY 2013 level of $40.4 billion under the temporary agreement. Most transportation accounts with mandatory funding are exempt from sequestration; however, $739 million per year in highway funding will remain subject to annual cuts.