Negotiations on the transportation bill are past the early stages and are shifting to the "substance of the bill," Sen. Barbara Boxer said yesterday.

In a news conference, the California Democrat said staff and members have not "gotten down to the areas of controversy" yet, but that good work has been done on the organizational level. The conference chairwoman and author of the Senate version of the transportation language also said she was optimistic about getting through the bill by June and that all of the issues on the table -- including language that would approve the Keystone XL pipeline -- are negotiable.

"No one has laid down a line in the sand," Boxer said. "What I heard [in the conference committee's opening statements] was very encouraging."

On the pipeline issue, Boxer pushed back against reports that it was a non-starter for her and other Senate Democrats, saying that it was "on the table." Boxer added that an amendment with similar language did not get 60 votes in the Senate -- it fell short with 58 -- and that "we have to figure out a way to get through that hurdle, and I think we will."

Boxer also said that a provision that sends fine money from the BP PLC oil spill to Gulf Coast states "will be included" because there is wide agreement from both parties on it. The House approved a bare-bones version of the bill, known as the "RESTORE Act," which was included in the Senate transportation bill.

The conference officially kicked off last Tuesday with all 47 members offering opening statements, although staffers had been working behind the scenes before that on a compromise bill. The members must meld a Senate-passed two-year, $109 billion bill with a 90-day extension passed by the House with riders on Keystone XL, EPA designation of coal ash, RESTORE and environmental streamlining (see related story).

Boxer said she will meet with members again tomorrow.

Boxer also highlighted a letter sent yesterday by 18 labor, business and construction groups calling on conferees to pass a bill before June 30 "to create jobs, protect businesses and keep America on the cutting edge of transportation infrastructure development."

Other conference members indicated that little substantive work had been done so far. Sen. Richard Shelby (R-Ala.) said he understood that staff talks, which continued yesterday, were still early on, and Sen. James Inhofe (R-Okla.) was unable to offer any updates.

Sen. John Hoeven (R-N.D.) continued to express optimism that the Keystone XL language and coal ash amendment would be included in the final conference report, saying legislators have taken an "open approach" to the elements in both bills.

Hoeven pointed to a letter sent last week by the Associated General Contractors of America that, among other recommendations, called for Congress to adopt the Keystone XL amendment and the coal ash language. The former, the letter states, would "lead to a clear path forward" for final passage of the transportation bill, while the coal ash language would help builders and benefit the environment by encouraging recycling.

"Although this legislation does not provide the revenue necessary to meet our nation's growing transportation infrastructure crisis, it will provide states with desperately needed funding certainty until at least the end of fiscal year 2013 and should be enacted quickly," the AGC letter states. "This will provide the certainty our members need to make capital investments and hiring decisions that they have been unable to implement during more than two years of short-term extensions."