Arkansas transportation officials said the state kept sufficient money on hand to make its semiannual debt payments on $575 million of outstanding highway bonds even if Congress had not shifted $8 billion into the rapidly shrinking federal Highway Trust Fund.
The state had some $58 million in its interstate maintenance account, from which it makes the debt service payments on its outstanding grant anticipation revenue vehicle bonds. The funds would have been sufficient to make the debt service due in February and to fund a highway interchange project in West Memphis.
However, Randy Ort, a spokesman for the Arkansas Highway and Transportation Department, said the state delayed action on the construction project to protect the debt service funds in the maintenance account. The debt service payment was never in doubt, Ort said, because the department had dedicated only a portion of the federal money for debt service.
Arkansas’ federal highway grants provide $58 million of the annual $73.5 million of debt service on the bonds, with about $16 million generated by a 4-cent-per-gallon increase on diesel fuel approved by voters in 1999.
The gets about $505 million in federal highway money each year.
Arkansas voters approved $575 million of 12-year highway bonds in 1999, which were sold in tranches of $175 million in March 2000, $185 million in July 2001, and $215 million in July 2002. However, voters in 2005 rejected a plan for another $575 million Garvee authorization by a 60-to-40 margin.
