September 2017

State DOTs Receive $3.1B in 'Bonus' Highway Funds

Texas, California, Florida, Pennsylvania and New York get largest shares 

By Tom Ichniowski, ENR


State transportation agencies are sharing a $3.1-billion “bonus,” through the Federal Highway Administration’s latest annual summer redistribution of unused highway funding.

The U.S. Dept. of Transportation, FHWA’s parent, also has announced it is taking applications for a new round of its much-sought Transportation Investment Generating Economic Recovery, or TIGER, grants.

The 2017 highway funding redistribution, which FHWA announced on Aug. 31, is the largest in at least the past five years, and is up 12% from the 2016 amount. All 50 states, plus the District of Columbia, received shares of the pie. Texas received the largest allotment, $280 million, followed by California, with $274.5 million; Florida, $158.6 million; Pennsylvania, $154 million; and New York, $145.3 million.

Demand for the funds far exceeded the amount available, with states requesting nearly $5.4 billion.

State departments of transportation must move quickly to put the reallocated money to use. FHWA says the redistributed funds must be obligated to projects by Sept. 26.

That isn’t expected to be a problem. Brian Deery, senior director of the Associated General Contractors of America’s highway and transportation division, says, “You’ll see the money go to work pretty quickly.”Deery notes that states must provide a nonfederal matching share to use the federal dollars.  But he adds, “Most states are geared up to do that….Generally states aren’t turning federal money back if they can get it.”

Dave Bauer, American Road & Transportation Builders Association senior vice president for government relations, says, "The redistribution ensures that the money gets used." The redistributed dollars are converted from funds that had been earmarked for specific uses, such as Transportation Infrastructure Finance and Innovation (TIFIA) loans, to nearly all-purpose funds—available for states to use on any type of project eligible for federal highway aid, Deery says.

The California DOT (Caltrans) said it is receiving $174 million of the state's $274.5-million share of the redistributed funds. Local California transportation agencies get the other $100.5 million. Caltrans said most of the projects that will use the reallocated funds are already underway, using state funds until the federal dollars arrive.

The Nevada DOT reports that it plans to use its $21.6-million allocation for projects such as upgrades to the Interstate-15/U.S. Route 93 Garnet interchange in the southern part of the state.

Delaware DOT says its $20-million allotment will go for such projects as a grade-separated interchange in Kent County, paving and road improvements in Sussex County and design for a bridge rehabilitation in New Castle County.

Unused TIFIA, FAST Act funds

Most of this year’s large redistribution comes from two sources, says Joung Lee, American Association of State Highway and Transportation Officials director of policy. Lee said in AASHTO’s Sept. 8 newsletter that the $3.1 billion includes about $1.4 billion in unused TIFIA money and $1.2 billion in unused obligation authority for Fixing America’s Surface Transportation (FAST) Act highway and freight discretionary grants.

Before the Obama administration left office, U.S. DOT had requested and received applications for the $850-million 2017 round of FAST Act grants, which it named FASTLANE. But the department didn’t make the awards before Obama’s second term ended.

After the Trump administration took over, DOT announced in June that it was deferring action on the FAST Act’s 2017 large-project grants for large projects, which were expected to total about $765 million, until 2018.

The department also renamed the program, to INFRA grants, and changed the award criteria. For example, there is more emphasis on use of nonfederal funding. DOT on Aug. 2 did select winning projects for $78.9 million in small fiscal 2017 INFRA grants, subject to congressional approval.

DOT says it will carry over the unawarded $770 million or so in 2017 FAST Act funds to 2018, and combine that funding with the $900 million authorized for the 2018 round.

ARTBA's Bauer notes that if U.S. DOT had obligated all of the available 2017 FAST Act and TIFIA funds, states in which those projects were located would have benefited. Under the redistribution, he says, "Now everybody will get a portion of it."

New TIGER Grant Round

Industry officials and states were pleased that DOT on Sept. 6 issued a request for new TIGER grant applications. The 2017 omnibus appropriations measure, enacted on May 5, includes $500 million for the program, which regularly gets requests for far more funds that it has available.

DOT says TIGER applications are due by Oct. 16. Since the program was launched in 2009, DOT has awarded a total of $5.1 billion in grants for a wide range of transportation project types. On the negative side, the recently enacted stopgap continuing resolution keeps the federal-aid highway program operating through Dec. 8, two months into fiscal 2018—but with funding set at 2017 levels.

Construction industry and state DOT officials preferred to see Congress adopt the FAST Act’s authorized 2018 highway program figures, which is about $968 million, or 2,2%, higher than 2017’s.


Reprinted from Engineering News-Record.

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