A broad coalition of 44 transportation industry stakeholders sent President Trump a letter on June 5 urging him to support an immediate $49.95 billion infusion of federal funding for state departments of transportation to cope with the economic fallout from the COVID-19 pandemic.
[Official White House photo above by Andrea Hanks.]
“With millions of Americans still following ‘stay-at-home’ orders, many state governments are facing severe losses in revenues across the board –including dedicated user fee revenues on which state DOTs heavily rely,” the letter said. “Projections continue to show decreases in state motor fuel tax and toll receipts as nationwide vehicle traffic reduction bottomed out at about 50 percent in early April.”
The groups estimates that state transportation revenue will decline by 30 percent on average over the next 18 months, with some states potentially experiencing revenue losses as high as 45 percent. As a result, the ability of state DOTs to carry out their core functions – including capital construction programs – is threatened, with some state DOTs already delaying critical transportation projects, putting transportation construction jobs at risk.
For example, Victoria Sheehan – commissioner of the New Hampshire Department of Transportation and AASHTO’s 2019-2020 vice president – noted in a recent presentation that shrinking traffic volumes represents potential losses of $55 million to $60 million to New Hampshire’s highway fund and $40 million to $50 million for its turnpike fund.
Sheehan also expressed concern for her department’s capacity to perform routine preventive maintenance of roads and bridges, explaining that deferring the work would lead to higher remediation costs in the future, adding that the New Hampshire DOT is also “minimizing the construction work effort that is funded by highway fund dollars.”
Other state DOTs are also experiencing similar revenue decreases and are taking similar steps to curtail transportation work in the face of those falloffs.
The Nevada Department of Transportation, for one, is planning for $143 million in budget cuts this biennium because of a decline in highway fund revenues triggered by the COVID-19 pandemic.
Cole Mortensen, the agency’s deputy director, noted in a news story that – so far this fiscal year – the Nevada DOT has identified $28.5 million in administrative cuts and in projects that will be postponed because they aren’t ready to send out to bid this fiscal year.
He added that the agency’s staff is recommending another $44.3 million in cuts by putting off work on I-80 in Elko and the downtown Ely reconstruction project that is worth a total of $29.8 million in federal, state, and local money.
Meanwhile, an economic briefing provided to the Illinois state legislature noted that driving in that state was down 60 percent in March and 40 percent to 50 percent in April.
That’s why the industry’s June 5 letter to the president emphasized that providing state DOTs with an immediate infusion of funding is not unlike action taken in prior COVID-19 response legislation, which compensated the aviation, transit, and passenger rail sectors for reductions in ridership and revenue.
“This urgently needed funding will prevent 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 noted.
“This action to preserve core state DOT capabilities is absolutely critical in order for states to carry out a robust, bipartisan, and long-term surface transportation legislation later this year that can serve as our national platform for economic recovery and growth,” it said.