Officials representing state departments of transportation warned Congress that its current budget freeze is preventing DOTs and transit agencies from using already-authorized federal funding increases as the spring construction season gets under way, and could prevent commuter railroads from using authorized crash avoidance funds for this year.
The officials also urged lawmakers to use the current opportunity for a major infrastructure investment program to provide a long-term funding stream to the Highway Trust Fund so that it will not again be in jeopardy following the end of a five-year authorization bill in 2020.
Congress has frozen spending for most federal programs at fiscal 2016 levels, by twice extending government spending under continuing resolutions rather than agreeing to new levels for 2017. The latest extension expires April 28, and it is not clear that lawmakers will be able to agree on a final 2017 budget by then.
In December 2015 Congress had passed the Fixing America's Surface Transportation Act that both authorized and funded the trust fund's highway and transit programs for five years, including moderate year-to-year increases, but Congress must still approve them in its annual budget and appropriations.
David Bernhardt, commissioner of the Maine DOT and this year's president of the American Association of State Highway and Transportation Officials, told a Senate Appropriations subcommittee hearing March 8 that under the continued 2016 funding levels state DOTs and local agencies are unable to deploy about $1 billion in this year's scheduled highway program increase.
In addition, public transit systems were scheduled to receive a nearly $400 million increase this year that they have not yet been able to tap, and the FAST Act included $199 million – just for fiscal 2017 – from the mass transit account to help fund crash-prevention positive train control systems, a one-year provision that would be lost if Congress continues to freeze spending at the 2016 levels.
Bernhardt gave his testimony before a subcommittee chaired by Sen. Susan Collins, also of Maine. He noted that cold-weather states like Maine have a short construction season, and need to have their federal funding in place when projects are ready to proceed.
"Continuing resolutions that provide only a portion of [federal funding] mean that even if we are ready to proceed with our much-needed projects, we can only commit federal dollars to a small portion of those projects," Bernhardt said. "Missing the construction window due to a less than full year obligation limitation can mean that some projects are delayed."
AASHTO Chief Operating Officer Jim Tymon told the hearing that although the FAST Act provided the transportation sector five years of predictable highway, transit and passenger rail funding levels, "that predictability is threatened" by the lack of a fiscal 2017 appropriations bill.
"The predictability of a five-year authorization bill means little if Congress is unable to pass annual appropriations bills that are consistent with the authorized funding levels in the FAST Act," Tymon told senators. "As we approach the beginning of the spring construction season, we urge you to pass a full-year 2017 appropriations bill that fully funds the surface transportation programs at the levels authorized in the FAST Act."
Those comments follow a similar warning from South Dakota Gov. Dennis Daugaard at a March 1 Senate Commerce Committee hearing. Daugaard said his testimony also represented the views of transportation departments in nearby states of North Dakota, Montana, Wyoming and Idaho.
"We are frustrated," the governor said, "because while the federal government operates under a continuing resolution, funding levels legislated in FAST [Act] for FY 2017 are not in effect. We have a short construction season in South Dakota. So a funding delay of a few weeks can sometimes translate to a year's delay in delivering a project."
Other state officials are expressing concern as well, reports Engineering News-Record. ENR cited comments by state DOT chief executives from Colorado and Michigan as well as Maine indicating that at some point the delay in getting the scheduled 2017 funding increase could cause them to put off projects they planned to work on this year.
Bernhardt and Tymon also pressed the case at the Appropriations hearing for Congress to ensure the trust fund will remain solvent after the FAST Act runs out in 2020. Otherwise, states, transit agencies and other stakeholders that rely on trust fund spending would again face potential year-to-year uncertainty that would hurt their ability to make long-term project investment plans.
"Major transportation projects around the country will be put to risk near the expiration of the FAST Act due to the unpredictability of federal funding at that time," Bernhardt said. "Such delays have serious economic consequences both in the short- and long-term. "
He said the infrastructure projects "employ thousands of companies and hundreds of thousands of workers every year. More importantly, these projects are what connect the traveling public to the many of facets of their lives. Once completed, they help stimulate economic growth in every community where they are built."
Bernhardt said any "disruptions to this process have the potential to send unwelcome shockwaves throughout the transportation community and other industries indirectly supported by infrastructure investment," including numerous small-business contractors that handle road projects and need certainty in making their payrolls.
If Congress does not act before 2020 to ensure long-term solvency of the trust fund, Bernhardt said, "this extremely costly and disruptive scenario will be all but inevitable."