DALLAS - States are reluctant to move ahead with road and transit projects despite the two-month extension of the Highway Trust Fund that Congress pushed through before the Memorial Day weekend to keep federal transportation funding flowing to states through the end of July.
State departments of transportation have pulled at least $1.3 billion of projects out of planned 2015 bid offerings due to uncertainty over continued federal funding and the total could be more than $2 billion, according to the American Association of State Highway and Transportation Officials.
"State DOTs are already postponing construction projects this year because they can't count on federal funds to be there," said AASHTO executive director Bud Wright. "Millions of dollars that should be flowing into communities, creating jobs and paying for projects to improve safety and mobility aren't being funded."
The latest short-term fix is a reflection of Congress's inability to fund a long-term surface transportation bill, which is causing uncertainty in the states, Wright said.
"We are disappointed and frustrated," he said. "Congress must find the political will to pass a long-term bill and put these short-term patches aside."
Arkansas has withdrawn a total of 70 project biddings so far in 2015, said Scott Bennett, director of the Arkansas State Highway and Transportation Department.
Another 120 road projects valued at $490 million remain at risk in 2015 in the state, along with 130 projects valued at $520 million that are set for bidding fiscal 2016, Bennett said.
"We operate on a cash basis and are not willing to take risks," he said. "We can't assume that, since Congress has always fixed the federal HTF, at the last minute they will do so again."
"Our only choice is to withdraw projects from bid openings," he said. "Congress must commit to reaching a long-term solution so we aren't back at the crossroads again in a few months."
The Senate passed the measure authorizing the two-month extension of federal transportation funding by a voice vote late Friday and sent it to President Obama where it awaits his signature. The House had passed the bill, H.R. 2353, on May 19.
Congress must pass a multiyear transportation bill before the short-term fix expires or find up to $10 billion of additional revenue to keep the HTF functioning through the end of calendar 2015.
Keeping federal transportation funding at current levels over the next six years would require putting about $100 billion of additional revenue into the HTF, according to the Congressional Budget Office.
The Senate Environment and Public Works Committee is scheduled to vote June 24 on a six-year transportation bill, committee chairman Sen. Jim Inhofe, R-Okla., and ranking minority member Sen. Barbara Boxer, D-Calif., said following passage of the short-term patch. The committee is responsible for setting the amount of federal transportation funding, but the Senate Finance Committee must find the needed revenues.
Inhofe and Boxer believe the extension will keep projects going. After the vote, they said in a joint statement, "With the two-month extension of the HTF, Congress prevented many critical road, bridge, and transit projects from coming to a grinding halt. But it's time we end this costly uncertainty."
Despite some Democrats vowing not to vote on another extension, Rep. Bill Shuster, R-Pa., chairman of the House Transportation and Infrastructure Committee, said last week that another short-term patch will be needed this summer to give Congress more time to find the revenue for a multiyear bill. Shuster had supported extending the HTF through the end of the year, but sponsored the two-month extension measure.
"We will more than likely have to pass another short-term patch before the August recess and take steps to ensure the trust fund remains solvent," he said.
Long-term funding may not come about until after a series of extensions. Maryland Transportation Secretary Peter Rahn does not expect Congress to agree on how to fund highways until after the 2016 election.
"They will do a short-term extension and I think they're going to keep doing extensions until after the presidential election in November of 2016," he said in a briefing sponsored by the Council of State Governments. "I think 2017 is when we will see something occur."
