States are seeking emergency DOT funding, but less than first predicted

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Updated Aug 3, 2020

Dsc02714State departments of transportation need an emergency infusion of federal funding, but not as much as previously estimated, according to the American Association of State Highway and Transportation Officials.

AASHTO and 39 other transportation construction organizations are calling on Congress, which is debating another coronavirus relief bill and infrastructure funding, to provide at least $37 billion in emergency funding to DOTs across the country to keep key transportation projects from being delayed or canceled. The amount would help cover steep gas-tax and other transportation-related revenue losses caused by stay-at-home orders during the early stages of the pandemic, as well as predicted future revenue losses.

In April, AASHTO called for $50 billion in emergency funding to offset a predicted 30 percent drop in revenues over the next 18 months. Since then, state DOTs have projected a less severe fiscal year 2021. There will still be a steep drop in revenues, but those losses will be extended over a five-year period, AASHTO says. DOTs will also still need about $16 billion to cover losses for fiscal year 2020.

“Projections continue to show decreases in state motor fuel tax and toll receipts as nationwide vehicle-traffic reduction bottomed out at about 50 percent during the height of the pandemic,” says a July 20 letter from AASHTO and the other organizations to congressional leaders. “As a result, the ability of state DOTs to carry out their core functions, including capital construction programs, is threatened.”

The letter adds that DOTs have delayed or canceled “$8.6 billion in critical transportation projects, putting at risk transportation construction jobs and the timely realization of benefits those projects bring to communities and commerce.” Some DOTs have also instituted employee furloughs because of revenue shortages, which leads to further project delays.

Providing the emergency federal funding “will prevent further disruptions to planned transportation projects and allow state DOT employees and transportation construction workers essential to planning and delivering these projects to remain on the job,” the letter says. “The funding will also preserve the core capabilities of state DOTs that are critical to implement a robust, bipartisan surface transportation reauthorization bill, which can serve as a platform for national economic recovery and growth.”

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Meanwhile, AASHTO and other transportation and construction organizations are hoping for a large-scale infrastructure plan. They are also concerned as the FAST Act, the nation’s main highway funding mechanism, is set to expire in September, and the Highway Trust Fund is nearing insolvency.

The House passed in July a $1.5 trillion infrastructure bill, including $319 billion for highway construction projects, with an $83 billion first-year infusion to states to offset revenue losses. A $287 billion Senate transportation bill, however, has remained stuck in committee for over a year.

(For a rundown on how the various transportation and infrastructure plans offered by the House, Senate and White House would affect road construction, click here.)

Organizations that endorsed the letter to Congress seeking emergency funding are as follows:

  • American Association of State Highway and Transportation Officials
  • American Coal Ash Association
  • American Concrete Pavement Association
  • American Concrete Pipe Association
  • American Council of Engineering Companies
  • American Council of Engineering Companies of Arizona
  • American Highway Users Alliance
  • American Institute of Steel Construction
  • American Iron and Steel Institute
  • American Public Works Association
  • American Road & Transportation Builders
  • Association American Society of Civil Engineers
  • American Subcontractors Association
  • American Traffic Safety Services Association
  • Arizona Rock Products Association
  • Arizona Society of Professional Engineers
  • Associated Equipment Distributors
  • Associated General Contractors of America
  • Association for the Improvement of American Infrastructure
  • Association of Equipment Manufacturers
  • Concrete Reinforcing Steel Institute
  • Ergon Asphalt & Emulsions, Inc.
  • Greyhound Lines, Inc.
  • Intelligent Transportation Society of America
  • International Union of Operating Engineers
  • Laborers’ International Union of North America
  • Maryland Asphalt Association
  • Mid-West Truckers Association
  • National Asphalt Pavement Association
  • National Association of Surety Bond Producers
  • National Electrical Contractors Association
  • National Steel Bridge Alliance
  • National Stone, Sand & Gravel Association
  • National Ready Mixed Concrete Association
  • National Utility Contractors Association
  • Portland Cement Association
  • Potters Industries
  • Precast/Prestressed Concrete Institute
  • Rural Transportation Advocacy Council
  • Volvo Group North America