Governors and state transportation officials nationwide are canceling or postponing critical highway, bridge and mass transit projects in the face of the imminent collapse of the federal Highway Trust Fund.
The Department of Transportation estimates that the critical source of about $37 billion annually to states to help underwrite major infrastructure projects will virtually run dry in the next few weeks unless Congress can cobble together a short-term compromise to keep state highway programs operating at least through November.
States count on the trust fund for between 15 percent and nearly 60 percent of their overall highway and transit funding, according to an analysis by Stateline, the Pew Charitable Trusts publication. While most projects already underway won't be affected, many thousands of new projects will be hurt by the funding uncertainty.
The current multi-year federal transportation legislation will expire in September, yet Congress is nowhere near agreement on funding either a new six-year, $100 billion comprehensive plan or a relatively modest $9 billion to $10 billion short-term fix. The dispute—as always—comes down to how to pay for the additional necessary spending, with Democrats favoring increased tax revenues and Republicans demanding offsetting spending cuts.
The highway trust fund dates back to 1956 and is largely dependent on the 18.4 cents per gallon federal gas tax and a diesel tax of 24.4 cents per gallon. Those taxes haven't risen since 1993. Meanwhile, inflation has eroded the trust fund's value while Americans have changed their driving and spending habits, further depleting the accounts.
On Monday, a number of groups, including the National Conference of State Legislatures, urged lawmakers to ensure the continued solvency of the fund. "Jobs, infrastructure projects and the safe and timely movement of freight are now at risk because of the impending insolvency of the HTF," a letter from the groups said.
While scores of states face serious problems unless Congress ends its impasse in the next week or two, here are 10 examples of some of the most serious transportation problems this summer faced by some states:
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1) The Arkansas Nightmare—Ten highway and bridge projects valued at $60 million have been postponed in Arkansas, including two bridge replacements in Pulaski County and one in Garland County. Arkansas has the 12th largest highway system in the U.S., yet it ranks just 44th in federal and state revenues to support it, according to Stateline. One GOP state legislator said Arkansas probably has $120 million worth of projects on the drawing boards, but it can't bid them out "because there's no guarantee" of reimbursements.
2) The Decrepit Boise Bridge—The Broadway Bridge in downtown Boise reportedly has the poorest structural rating of any Idaho bridge. That's no joke, considering that on game days at Boise State University, thousands of people crowd the narrow sidewalks to get past traffic jams on the bridge. The bridge replacement will cost about $11.2 million; the federal share would cover most of it, or $10.4 million.
3) Kentucky Blues—The Bluegrass State has nothing to cheer about on the highway front after state officials delayed about $185 million worth of federally funded road projects—including a much-needed widening of sections of Interstate 65 between Elizabethtown and Bowling Green. The funding problem "means money for new projects, preservation efforts and most importantly, improved highway safety and construction jobs are at risk," Gov. Steve Beshear said last week, according to reports. The section of I-65 where the widening has been postponed includes the site of a fiery crash in March 2010 that killed 11 people.
4) The Ill-fated Columbia River Crossing—This $3.5 billion proposal to replace the Columbia River Bridge that connects Portland, OR, to a suburb of Vancouver, WA, was laid to rest recently after the state legislature and the governor of Washington State couldn't reach a compromise to provide state matching funds. But any hope of reviving the project was dashed after Oregon officials—worried about the uncertainty over the highway trust fund—decided to use federal funds once meant for the Columbia River Crossing to finance eight much smaller projects.
5) Uncertainty in New Mexico—State officials are fretting that the Paseo Del Norte—Interstate 25 interchange project—the biggest construction project in the state—may run short of cash soon if the trust fund goes bankrupt. Construction of the massive interchange project is about a quarter complete, and state officials had been planning to step up work this summer. It may not happen now.
6) Boston Highway Projects Massacre—Massachusetts stands to lose nearly $5 billion of proposed road, transit and bicycling improvements, according to the Boston Globe. An extended funding shortfall could also sidetrack the final phase of the Green Line extension of train service from a relocated Lechmere Station in East Cambridge to Somerville and Medford. "That would be an enormous cut to our pretty ambitious transportation program," said Richard A. Davey, the state transportation secretary, The Globe reported.
7) Bus Shortages in Columbus—It is often hard to get around Columbus, Ohio, the seat of state government and home to Ohio State University, because of a bus shortage. To alleviate that, the Central Ohio Transit Authority has proposed adding 29 new buses to its current fleet in 2015. Area residents supported a sales tax to help fund the expansion, but the transit authority is counting on federal matching funds to buy many of the new buses. Good luck on that.
8) Fear and Loathing in California—Because this state is so big and populous—and amply represented on key transportation committees in Congress – California has long enjoyed plenty of federal highway and transit aid. But the trust fund crisis could jeopardize $2 billion worth of construction involving 250 state-sponsored rehabilitation projects and hundreds of other local street and road repairs, according to the Association of State Highway and Transportation Officials. The loss or delay of all those projects could cost the state roughly 62,400 jobs.
9) Shutdown in Rhode Island—The state typically relies on about $200 million a year in federal funds to plan, build and maintain Rhode Island's transportation hub. But fearing the worst, Rhode Island officials stopped practically all new highway construction projects, according to Stateline. Among the casualties: the Providence Viaduct, designed to take Interstate 95 through the city.
10) Little to Show in the 'Show Me' State—Missouri officials were among the first to batten down the hatches in anticipation of a trust fund crisis. In January, "Missouri's highways and transportation commission voted against adding any projects this year to the state's five-year transportation improvement program," according to Stateline. In a normal year, the state would have added 300 to 500 projects. Missouri received 47 percent of its highway and transit funding from the federal government in fiscal 2011, the latest figures available.
Expressing the frustration of many officials, Bob Brendel, a spokesperson for the Missouri Department of Transportation, told Stateline: "We're going to be in virtually a maintenance-only mode, and even that is short of what we need to maintain our system."
—By The Fiscal Times' Eric Pianin