States Forced to Delay Millions of Dollars in Highway Contracts

States have put the brakes on millions of dollars of highway construction projects and are scrambling to substitute scarce state funds for the federal funds that have been cut off due to the crisis in the Highway Trust Fund. "States are suspending new contract awards, halting right-of-way acquisition and looking for ways to stop on-going construction while maintaining public safety," said AASHTO Executive Director John Horsley. "It is truly a crisis that Congress must resolve immediately. Every day the federal IOUs are piling up and the states' financial hole gets deeper." U.S. Secretary of Transportation Mary Peters announced on Friday that the federal government would slow down reimbursements to the states, and would likely be able to make only partial payments beginning next week, due to insufficient funds in the Highway Trust Fund. She has urged Congress to enact by the end of the week, a $8 billion transfer from the General Fund to preserve the solvency of the Highway Trust Fund. Action is pending in the Senate. More than a dozen states have detailed the impacts of the federal default on state programs, either in news releases or via media reports. Those impacts are available on the AASHTO website www.transportation. org or at the following links:

ALABAMA
Diminished Fuel Taxes Causes Rationing of Federal Fundinghttp://www.dot. state.al. us/NR/rdonlyres/ 2124AC24- B723-467D- 9C4D-DC8D78FB52B5/ 0/99HTF.doc

ARIZONA Federal Highway Fund Bankruptcy Hits Arizona: ADOT to Delay New Federally Supported Projectshttp://www.azdot. gov/ccpartnershi ps/news/NRel2175 .asp Arizona Highway Projects Stall Out in Face of ShortfallLink to story in The Arizona Republic:http://www.azcentra l.com/arizonarep ublic/local/ articles/ 2008/09/06/ 20080906adot0906. html

CALIFORNIA
Statement from Caltrans Director Will Kempton: Today, the U.S. Department of Transportation announced that effective Monday, September 8, the Federal Highway Administration will delay financial reimbursements from the Highway Trust Fund to all states. Here is a statement from California Department of Transportation (Caltrans) Director Will Kempton in response: "This latest announcement from the U.S. Department of Transportation aggravates an already tight budget problem for California's transportation program. We had projected that the state budget impasse could impact ongoing transportation construction projects by October. However, delays in federal reimbursements could exacerbate this situation. Failure to resolve this issue will have a significant impact on California and the rest of the nation. Unless resolved, this situation could result in delaying, reducing, or canceling transportation projects. The ripple effect could impact the state's economy through loss of revenues, reduced productivity and increased unemployment. In July, I wrote a letter to California's congressional delegation emphasizing the need to resolve this issue at the earliest possible date. We will continue working with Congress and federal transportation officials to secure the passage of legislation that will address the funding shortfall in the Highway Trust Fund."

COLORADO
Colorado Trying to Cope with Federal Cuts to Road FundsLink to story in the Rocky Mountain News:http://www.rockymou ntainnews. com/news/ 2008/sep/ 06/state- trying-to-cope-with-federal- cuts-to-road/

KANSAS
State of Kansas Department of Transportation expresses some funding concernsLink to story in The Fort Scott Tribune:http://www.fstribun e.com/story/ 1459509.html

MICHIGAN
US Road Fund Short, May Pinch Big Projects in MichiganLink to AP story:http://www.freep. com/apps/ pbcs.dll/ article?AID=/20080906/ NEWS07/809060334 MINNESOTAMinnesota Projects Not EffectedLink to story in the Star Tribune:http://www.startrib une.com/local/ 27914954. html?elr=KArksLckD8EQDUo aEyqyP4O: DW3ckUiD3aPc: _Yyc:aULPQL7PQLa nchO7DiUsA

MISSOURI
Missouri DOT Watches Washington Money SituationLink to story on KRMS Radio:http://www.1150krms .com/?q=node/ 3220 Highway Trust Fund Shortfall Could Cause State Highway Projects to be Canceledhttp://www.modot. org/newsandinfo/ District0News. shtml?action=displaySSI& newsId=21745

NEW HAMPSHIRE
New Hampshire Worries Feds Might Hamper Road WorkLink to AP story:http://www.boston. com/news/ local/new_ hampshire/ articles/ 2008/09/06/ nh_worries_feds_ might_hamper_ road_work/ OKLAHOMAHighway Construction Halted by

Oklahoma DOT
http://www.okladot. state.ok. us/newsmedia/ press/08_ 051_highway_ construction_halted_ by_odot.pdf

PENNSYLVANIA
PENNDOT Secretary Says Federal Funding Shortfall Could Impact PA'S Highway, Bridge ProgramCongress Needs to Enact Fix to Restore Fundhttp://downloads. transportation. org/PA_Rls_ Trust Fund 0905081.doc $8 Billion in State Highway Funding at Risk in PennsylvaniaLink to story in the Pittsburgh Tribune-Review:http://www.pittsbur ghlive.com/ x/pittsburghtrib /news/state/ s_586804. html

TEXAS
TxDOT says highway fund close to depletionLink to story in the San Antonio Business Journal:http://www.bizjourn als.com/sananton io/stories/ 2008/09/08/ daily12.html

WASHINGTON
Gov. Gregoire's Statement on the Federal Highway Transportation Funding Bankruptcyhttp://www.governor .wa.gov/news/ news-view. asp?pressRelease= 985&newsType= 1 Washington Projects Could be Affected as Federal Fund for Roads Runs DryLink to AP story:http://seattletimes .nwsource. com/html/ localnews/ 2008161902_ roads06.html

NATIONAL
Highway Fund Bailout Now Backed by Bush AdministrationLink to story in The Los Angeles Timeshttp://www.latimes. com/news/ nationworld/ nation/la- na-highway6-2008sep06,0, 4699247.story Senator Inhofe Urges Immediate Action to Prevent Highway Trust Fund Insolvencyhttp://media- newswire. com/release_ 1072317.html Highway Fund Shortfall May Halt Road ProjectsLink to story in The New York Times:http://www.nytimes. com/2008/ 09/06/us/ 06highway. html?_r=1&scp=2&sq= highway%20fund& st=cse&oref= slogin