DOT funding cutoff left states in turmoil

DOT funding cutoff left states in turmoil    The failure of U.S. Department of Transportation officials to show up for scheduled speaking engagements at a gathering of state transportation officials in Arlington, Va., on Monday was tangible evidence of the shutdown of federal highway and transit programs due to a lapse in spending authority.
   The Senate, by a vote of 78-19, late Tuesday night passed the bill extending use of the Highway Trust Fund for highway construction and safety programs, after Sen. Jim Bunning, R-Ky., ended his efforts to block the bill.
   It was the first time since the Highway Trust Fund was created in 1956 that highway and transit programs have been interrupted, leading the DOT to suspend payments to states for federally backed projects and begin procedures to furlough 4,000 employees Tuesday.
   Leaders of the American Association of State Highway and Transportation Officials railed against Congress for not passing a temporary extension of surface transportation spending authority on Friday, saying inaction jeopardizes needed road and bridge projects, and safety, puts people out of work and increases construction costs.
   In the process of working out differences between House and Senate versions of a jobs bill, Senate leaders late on Feb. 25 agreed to move an emergency bill without formal debate to extend unemployment benefits and surface transportation authorization for 30 days. Bunning refused the expedited voting procedure on the grounds that the unemployment benefits would add $10 billion to the deficit without offsetting savings.

LaHood

   'As American families are struggling in tough economic times, I am keenly disappointed that political games are putting a stop to important construction projects around the country,' Transportation Secretary Ray LaHood said. 'This means that construction workers will be sent home from job sites because federal inspectors must be furloughed.'
   The DOT has been operating under a series of short-term extensions since the SAFETEA-LU multiyear spending plan expired in September. The last temporary funding mechanism expired Sunday at midnight.
   Larry L. 'Butch' Brown, executive director of the Mississippi Department of Transportation and president of AASHTO, said at a press conference that without the certainty of federal reimbursements states could not proceed with planning, implementing or financing projects. He called Congress' failure to act 'unforgivable.'
   The developments in Washington forced the Missouri Department of Transportation last week to cancel its February bid letting for $60 million worth of projects and postpone advertising for March bids worth $70 million, Director Pete Rahn said.
   'If Congress does not act, and act soon, the next step will not only be suspension of new contracts, but we will have to consider the suspension of ongoing contracts which people are working on currently,' he added.
   States were due to receive $768 million in federal highway money and $157 million in transit outlays from the DOT this week.
   Most states do not have the excess balances to cover the loss of federal funds and pay contractors because of their own deficits during the recession and unexpected road maintenance expenditures due to the extremely harsh winter, said Susan Martinovich, director of the Nevada Department of Transportation.
   The stalemate in Congress effectively shut down a federally managed reconstruction project for a new Interstate 15 bridge to move vehicles off the Hoover Dam, she said. The project, which is scheduled for completion in October, will improve conditions for truckers that are required to detour 90 miles because of post-9/11 security restrictions at the dam. Martinovich said she has held up a bid request for a $155 million highway-widening project north of Las Vegas until she's sure how to pay for it.
   The fallout included work stoppage on a $50 million bridge reconstruction project in the District of Columbia because the bridge is over CSX Transportation freight rail and Amtrak tracks and requires federal oversight and inspection, said Gabe Klein, director of the city's department of transportation. The shutdown costs about $10,000 per day in interest and other payments. Klein said he expected the federal government to cover any delay claims.
   Other DOT administrators worried that banks might raise the interest rate on their bonds to account for the increased risk associated with guaranteeing payment with federal dollars.
   'One of the problems we've had is the starting and stopping of the reauthorization. For the last three months we've had a month-by-month, kick-the-can-down-the-road of reauthorization. We can't plan long-term,' Washington Transportation Secretary Paula Hammond complained.
   AASHTO officials called for an extension of highway and transit programs through the end of the year, with funding restored to 2009 levels. The Senate jobs bill includes an extension of surface transportation authority for 10 months and deposits $19.5 billion of general revenue into the Highway Trust Fund to keep it solvent. Funding under an extension matches the level in the last year of SAFETEA-LU, unlike the short-term continuing resolutions that have reduced grant-making capacity by 30 percent.
   States could have probably squeaked by until Thursday before they had to totally halt projects, Brown said. Restarting existing projects costs time and money because agencies must repeat administrative and contractual steps.
   Also at risk were federal project approvals for new projects. New York was unable to proceed with a bid to build a new bridge crossing to Vermont over Lake Champlain because it is still waiting on Federal Highway Administration approval, said Stan Gee, acting commissioner of the New York State Department of Transportation.
      Hammond also insisted that Congress complete a six-year transportation act by the end of the year. Last week Sen. George Voinovich of Ohio, one of five Republicans who joined Democrats to override a filibuster on the jobs bill, said Senate Majority Leader Harry Reid promised him before the vote that he would bring a multiyear surface transportation bill to the floor for a vote this year.
   Sen. Barbara Boxer, chair of the Environment and Public Works Committee will hold a hearing Wednesday on how transportation investments help the economy.
   Last week, Sen. Kent Conrad, D-N.D., scolded LaHood at a budget hearing for not producing an administration version of the transportation bill. LaHood reiterated that the administration needs more time to think through the difficult policy choices and said a plan won't be released before the end of the fiscal year, at the end of September.
   'Given our nation's dire financial outlook, we cannot afford to continue funding our highways and transit out of the general fund. 'That cannot be the answer. That is why it is critical that we get a long-term highway reauthorization plan from the administration. We need to know how the administration would bridge this funding gap.'
   James Corless, director of Transportation for America, in an interview put the chances of passing a bill this year at about 15 percent to 20 percent because of the difficulty finding a financing mechanism given widespread opposition to a fuel tax increase. He said supporters may have to settle for a smaller bill than the $450 billion to $500 billion one proposed last year by House Transportation and Infrastructure Chairman James Oberstar.
   Transportation for America is a coalition of more than 400 environmental, urban development, health and safety, bicycling and public transportation organizations.
   During a panel on the increasing use of performance-based metrics for prioritizing transportation projects, Emil Frankel, director of transportation policy for the Bipartisan Policy Center, summed up the audience's frustration with politics in Washington by saying, 'I think actually we should be talking about performance measures for Congress.'
   Transportation planners received a bit of good news when the Obama administration announced that no state would forfeit unspent funds from last year's stimulus bill. March 2 was the deadline set by the American Recovery and Reinvestment Act for the redistribution of any unspent highway funds not approved by the Federal Highway Administration, but all states have already obligated every dollar at their disposal. ' Eric Kulisch