A little more than a day before the nation’s highway and transit projects would lose funding—threatening nearly 2 million jobs—and student loan interest rates were set to double, Congress acted.

The House (373-52) and Senate (74-19) this afternoon passed the two-year, $120 million Surface Transportation Extension Act of 2012 that will protect more than 2 million jobs and expand a loan guarantee program that could create an additional 1 million jobs (mostly in the construction sector). The bill also keeps interest rates for college students on subsidized Stafford Loans at 3.4 percent. They were set to double on July 1 to 6.8 percent.

Sen. Barbara Boxer (D-Calif.), chair of the Senate Environment and Public Works Committee, says the bill would save about 1.8 million jobs by keeping aid for highway and transit construction flowing to states. The transportation bill also includes program reforms that will streamline and expedite project delivery and expands a loan guarantee program that could create 1 million additional jobs.

Unfortunately, a number of provisions from the Senate bill (S. 1813) were dropped in conference, including a provision that would give transit agencies the budget flexibility they need to avoid layoffs and cuts in service.

Sean McGarvey, president of the AFL-CIO Building and Construction Trades Department (BCTD), says: 

With significant infrastructure needs and unacceptable levels of unemployment in the construction sector, the enactment of this important legislation represents a significant legislative achievement that ends years of costly extensions, and prepares the foundation for a long-term surface transportation bill. 

Some 7.4 million students will benefit from the student loan provision and save about $1,000 a year. The average student loan debt is $25,000 and on the rise. Millions of Americans now owe more for student loans than credit cards—student loan debt cannot be discharged in bankruptcy.