States Pull Back From Highway Projects Amid Uncertainty Over Federal Funding

This story appears in the April 13 print edition of Transport Topics.

States are delaying or canceling transportation projects for the second consecutive year while the construction season continues to be plagued with uncertainty over whether Congress will replenish the Highway Trust Fund.

Arkansas, Tennessee, Georgia and Wyoming publicly took $1.3 billion in projects off their monthly bid lists, according to the American Association of State Highway and Transportation Officials.

“I think the problem is actually worse than just the four states,” said Jim Tymon, AASHTO’s chief operating officer and director of policy and management. “It’s just that some states are a little less willing to come out and say, ‘Look, these are the projects on the chopping block.’ ”

Like last year, when Congress waited until midsummer before approving a short-term funding extension to save the Highway Trust Fund from default, lawmakers are not saying what action they will take before the temporary extension expires May 31.

Meanwhile, Arkansas has delayed or canceled $161 million in projects, including the entire annual overlay for its resurfacing program.

“Now that we have canceled our overlay program for this year, there are few areas in the state that are not affected by projects withdrawn from the April bid letting,” Scott Bennett, director of the State Highway and Transportation Department, said March 24. Arkansas has taken projects off its monthly bidding list three times this year.

“If you stop and think about the economic impact this has — not only on construction jobs, but the lost commerce that results in each local area because construction isn’t taking place — then you begin to understand the trickle-down effect and the urgency of solving this national problem,” Bennett said.

Georgia has put $715 million worth of projects on hold, including $4 million in improvements to the interchange where Interstate 20 meets I-285 in Fulton County.

“It carries a lot of truck traffic, and it’s very congested today,” assistant state traffic engineer Mark Demidovich told Transport Topics. “It doesn’t function very well, especially during the peak hours.”

Tennessee has delayed $400 million in construction projects from its bidding list, including four truck climbing lane projects on I-40 and one on I-70.

If Congress comes up with funding before May 31, the truck climbing lanes and other projects could go out to bid in the summer and construction delays might be only six to nine months, Tennessee Transportation Commissioner John Schroer said.

If federal lawmakers don’t act by May 31, “all bets are off,” he said. “It is literally impossible to do a long-term project with only short-term funding commitments.”

Wyoming, meanwhile, has put more than $28 million worth of projects on hold, including two major resurfacing projects on I-80, a critical freight route.

When states don’t receive adequate and timely funding and delay or cancel projects, the economic impact is national, John Cox, Wyoming director of transportation and AASHTO president, told a hearing of the U.S. House Transportation and Infrastructure Committee on March 17.

More than half the traffic on I-80, which stretches 401 miles east to west across Wyoming, is from trucks in transit through the state between West Coast ports and Midwest markets, Cox told the panel.

“This traffic, which contributes greatly to national commerce, would not be possible without an effective interstate transportation system,” he said.

The American Road and Transportation Builders Association said in late March that its surveys indicated that at least nine more states may have to delay or cancel an additional $1.8 billion in construction projects if Congress doesn’t act before May 31.

Transportation officials nationwide said they are closely watching Congress. States depend heavily on federal reimbursements for most capital projects.

“We keep a constant pulse on the situation,” said Rich Kirkpatrick, press secretary at the Pennsylvania Department of Transportation.

“Federal funds make up roughly half of our annual construction contracts,” he said.

Vermont Secretary of Transportation Sue Minter said: “We are very concerned about the situation and watching it weekly.”

Vermont has a short construction season, and Gov. Peter Shumlin decided he would not put the state’s economy at risk by delaying or canceling construction projects that mean livelihoods for contactors and workers, Minter said.

If federal reimbursements are delayed because Congress doesn’t act by May 31, Vermont has a backup plan. The state treasurer will lend DOT money to keep projects on track, Minter said.