More than $8.5 billion of work planned in 14 states and 19 localities — from major highway projects to local street repairs — has been canceled or delayed, according to the American Road and Transportation Builders Association.
The organization is urging Congress to step in and provide state transportation agencies a $50 billion rescue package, after they were left out of the last round of stimulus funding that Congress approved in late March.
“There really is an urgency about finding direct assistance for state DOTs so they can continue to move forward with the projects they had planned for this summer,” said Jim Tymon, the executive director of the American Association of State Highway and Transportation Officials (AASHTO).
In recent weeks, demand for gas has rebounded as people take to the roads again, according to the U.S. Energy Information Administration, but demand remains well below where it stood last summer. Officials expect the recovery to be slow and unsteady as a surge of cases of covid-19, the disease caused by the novel coronavirus, leads governors to retrench on reopening plans and the deep economic pain from the first round of stay-at-home orders lingers.
Jack Marchbanks, director of the Ohio Department of Transportation, saw trouble coming early. In February, he was sitting with U.S. Transportation Secretary Elaine Chao at a conference in Washington when she mentioned that roads were empty in Wuhan, the Chinese city where the virus was first detected.
“That hit me like a ton of bricks,” Marchbanks said.
Initially, some states used the traffic-free roads as an opportunity to speed up construction projects. But for Marchbanks, the looming math was simple: No cars, no gas sold, no money.
When he got home, Marchbanks had his financial team sketch out what might be coming and quickly moved to push back the timeline for a pair of major highway projects. His department announced the step just two days after the state’s stay-at-home order went into effect in March.
Marchbanks said the projects are necessary to improve safety and ease congestion. One of them, where Interstates 70 and 71 meet in Columbus, is tackling a section of road that is among the state’s most dangerous — with some 900 crashes a year — and one of the most snarled junctions in the country.
“We do need these improvements, and we are hoping for a rebound in the economy or a stimulus package that will allow us to restart,” he said.
But the idea of “infrastructure week” has become a stock joke in Washington, with officials promising to deliver billions or even trillions of rejuvenating dollars, only for plans to evaporate.
Even now, when the Treasury has pumped out money to battle the economic impact of the pandemic, the prospects for aid from Washington are uncertain. And they’re complicated by Congress’s needing to extend the federal highway funding program before it lapses in September. But AASHTO’s Tymon and the road builders association say they remain optimistic about getting at least some form of help.
A five-year highway bill passed by House Democrats last week would give states a cushion by freeing them from their obligation to spend a dollar on transportation to get four more from the federal government, and would pump in extra cash, too.
Rep. Peter A. DeFazio (D-Ore.), the chairman of the House Transportation Committee and chief architect of the bill, called it “exactly the kind of investment we need to help our economy recover from the current pandemic.”
But House Republicans stridently opposed the legislation, which includes sweeping policy changes to bend resources toward supporting transit and reducing the environmental impact of the transportation system. Rep. Sam Graves (Mo.), the ranking Republican on the Transportation Committee, said the Democrats’ proposal was too radical to adopt in the midst of the pandemic.
“What our transportation businesses and workers need right now is stability, but this partisan process and seismic upheaval of our federal transportation programs robs them of that,” Graves said on the House floor.
The Senate, which Republicans control, has yet to finalize its version of a five-year transportation bill. And though President Trump tweeted about the idea of a $2 trillion infrastructure package as a form of coronavirus relief, no proposal on that scale has emerged.
That fits a pattern of almost four years of unfulfilled pledges by the president and congressional leaders alike to set the country’s transportation networks on a new course with a massive infusion of money. Instead, the virus has left officials on the front lines scrambling to hold their aging systems together.
The transportation network is vital to the national economy, and supporters of more federal spending say that investing now not only could avert the crisis but also could promote growth in the long run.
Alison Black, chief economist at the American Road and Transportation Builders Association, said that spending now would help put people to work in construction at a time when millions are jobless, and would make the economy more productive.
“The more you invest in infrastructure, it helps business productivity,” said Black, who has been compiling weekly reports on where states are cutting projects. “Otherwise, we will pay for it in terms of the rising costs of goods.”
The stay-at-home orders issued by many governors dealt the states a deep, if fairly short-lived, setback in revenue.
In April, Americans drove about 40 percent fewer miles than they did at the same time last year, according to the Federal Highway Administration. In May, the most recent month for which figures are available, the decline was still more than 25 percent.
Demand for gasoline likewise plunged, from 407 million gallons per day in mid-March to 212 million gallons per day in the first week of April, according to the Energy Information Administration — the lowest figure in almost 30 years of the agency’s data.
Figures compiled by private companies analyzing cellphone location data indicate that travel is returning to near where it was in late winter. But the demand for gas at the end of June was still down 10 percent from the same point last year.
“The impacts of what we’re seeing with covid-19 are going to be long-lasting,” Tymon said. “Who knows what next month brings? This is such an evolving situation week to week, day-to-day, it’s hard for anybody to be able to plan.”
Black’s reports have noted not only the $7 billion of delayed projects but also about a dozen proposals to increase funding that have been canceled or pulled from ballots as politicians worry about imposing new taxes on their constituents. That could ultimately mean transportation agencies losing out on billions more, according to Black.
In the District, the D.C. Council gave preliminary approval to a 10-cent gas tax increase this week. But Mayor Muriel E. Bowser (D) pushed back against any effort to raise taxes in the middle of the crisis, calling the idea “foolhardy,” although she said after the council vote that the impact of a gas tax increase probably would be small because so many District residents buy fuel in Maryland and Virginia.
The crisis has hit some states much harder than others, especially those that haven’t raised their gas taxes in several decades, leaving them precariously reliant on federal funding.
In North Carolina, the transportation department’s cash reserves fell so low in May that it tripped a legal provision barring the department from entering into new contracts. The state had already announced that it was delaying more than 100 projects, including a half-billion-dollar plan to widen a section of Interstate 95 to eight lanes.
Patrick McKenna, director of the Missouri department of transportation, wrote to members of his state’s congressional delegation in mid-April with a dire warning: The state might not be able to scrounge up enough money to match federal funds it was due.
“To put this into perspective, that would equate to approximately 400 bridges and 20,000 lane miles of Missouri roadways NOT being repaired that are in our current plan,” McKenna wrote.
While experts say no state has ever had to forgo the federal money because of an inability to provide matching funds, McKenna’s warning shows how sharply some states are feeling the pinch.
Missouri, which is carved up by rivers and sits on major cross-country highways, has an outsize network of roads and bridges, yet it has not increased its gas tax since 1996. McKenna, who is president of AASHTO, the state highway officials group, said in an interview that he’s forced to look after Missouri’s transportation infrastructure in a way that amounts to plugging holes.
“What we’ve been doing is managing the decline of the infrastructure,” he said.
One of his biggest concerns is not being able to move forward with work to replace the 3,018-foot Rocheport Bridge, which carries Interstate 70 across the Missouri River and, among its functions, is a vital link between plants where Ford makes engines for F-150 trucks and assembles finished pickups. Should work pause, McKenna said, the bridge would have to be reduced to one lane each way, causing 25-mile backups.
“That’s just one example of the economic dislocation,” he said.
Other states have been able to juggle, at least for now. In Oklahoma, lawmakers raided a transportation fund to give $200 million to schools, which were facing their own budget crisis, but authorized the state transportation department to issue bonds to make up the shortfall.
Response in D.C. region
The Virginia Department of Transportation has been evaluating its spending plans as part of a statewide review ordered by Gov. Ralph Northam (D). Emily Wade, a spokeswoman for the department, said the impact of the pandemic on VDOT’s finances would become clearer over time as the state actually collected the revenue from taxes paid at gas pumps.
In Maryland, where a single agency oversees airports, a major transit system and highways, officials were able to use federal rescue funds to prop up the airport and transit budgets and freed-up state money to keep the entire transportation network operating safely. That filled a $500 million hole for the last budget year, but the state expects to have to find another $500 million for the fiscal year that began July 1.
Maryland Transportation Secretary Greg Slater is a veteran of the 2008 financial crisis and the recession that followed, and he said he has been tapping into the wisdom of the team he worked with back then to navigate the present crisis.
“This is a much different shock because it was just so drastic,” he said.
While shuffling money has worked for now, Slater said he doesn’t think he’ll be able to pull it off for a second year. That has left him looking to the federal government.
“We’re hopeful we’ll get some congressional action,” he said.
Fenit Nirappil contributed to this report.