WASHINGTON Feb 19 State and local governments
are spending more on highways, roads and bridges now that they
have a long-standing funding commitment from the federal
government, according to a recent report from the American Road
and Transportation Builders Association.
The group, the oldest transportation construction-related
association in the United States, found that from Oct. 1 through
Feb. 15, federal, state and local transportation departments
have set aside $7 billion in federal funds for capital works
projects, a 56 percent increase from the same period last year.
In January alone, the transportation departments obligated
$2.3 billion, 13 percent more than in January 2012, the group
said in a special report released last Friday.
"The current obligations levels are much more in line with
what we expect to see in the marketplace," ARTBA Chief Economist
Alison Black said in a statement, adding that they had been
"quite low" the previous two years.
Transportation departments obligate, or set aside, money for
projects about to be bid and constructed, and are an indicator
of states' spending plans.
Legislation authorizing federal funds for transportation,
commonly known as the "highway bill," expired in 2009 and states
relied on a patchwork of temporary extensions until the middle
of 2012 when a new, two-year law was passed. States spent
cautiously during extensions, unsure of what amounts they would
receive six months out.
Now, many in construction are worried about how federal
budget fights will affect road and highway projects.
The main account for surface transportation, the Highway
Trust Fund, which is filled with revenue from a gas tax charged
at the pump, is not subject to the automatic federal spending
cuts set to begin in 10 days.
But even though the account is exempt from "sequestration,"
it is still under threat in later years, said the Associated
General Contractors of America on Monday.
The group estimated the trust fund, along with the Airport
Improvement Program, Department of Veterans Affairs, and General
Services Administration, which also escaped sequestration, will
face $1.5 billion in funding cuts in the next few years because
of caps the federal government has placed on its spending under
the Budget Control Act.