State DOTs Adjust Relief Request Amid Updated Projections

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With persisting stay-at-home orders across the nation, severe revenue losses including sharp declines in dedicated user fee revenues, continue to be felt across state departments of transportation (DOT). As a result, the ability of state DOTs to carry out their core functions, including capital construction programs, is under threat.  Through imposed furloughs and either delaying or cancelling $8.6 billion in critical transportation projects, this pandemic has put transportation civil engineering jobs at risk and hindered economic growth. The American Association of State Highway and Transportation Officials (AASHTO), ASCE,  and numerous transportation organizations have come together to urge Congress to provide relief for our state DOTs to ensure the delivery of planned projects and help stabilize the economy.

Back in April, AASHTO urged Congress to provide $50 billion in emergency relief and intended to provide an immediate backstop to state DOTs in order to prevent major disruptions in their ability to operate and maintain state transportation systems during the ongoing pandemic. At the time, state DOTS were estimated to lose approximately 30% of transportation revenues over 18 months across highway user fees and tolls, federal grants, other state funding, bond issuance, and payments from local governments. The projected total loss of near $50 billion was composed of $16.7 billion loss in fiscal year (FY) 2020, and a $33.3 billion loss in FY 2021. Supporting this request was 137 Member of Congress , 26 Senators, and numerous industry stakeholders including ASCE.

Three months later the revenue shortfall projections have changed, but the need remains the same.

AASHTO now estimates $37 billion over five years in state DOT revenue losses – through fiscal year (FY) 2024 – with an estimated loss of $16 billion in FY2020, $12 billion in FY2021, $5 billion in FY2022, and $2 billion in FY2023 and FY2024. The change in estimated lost revenue is due to the less severe outlook for FY2021 from state DOTs compared to earlier this year. Projections continue to show decreases in state motor fuel tax and toll receipts as nationwide vehicle traffic reduction bottomed out at about 50% during the height of the pandemic.

Regardless of the revised request amount, the need for federal funding for state DOTs remains urgent. In ASCE’s 2017 Infrastructure Report Card, our nation’s roads and bridges received the grades of a “D” and “C+.” By enacting this request, lawmakers would allow state DOT employees and transportation civil engineers to remain on the job, support core capabilities needed to implement a federal surface transportation reauthorization bill,  prevent further disruptions to planned transportation projects, and raise these subpar grades.

As Congress looks to the next phase of relief for the COVID-19 pandemic, ASCE along with 40 transportation organizations sent a letter to Congressional Leadership urging for action and support for the new $37 billion relief request.

Now is the time for action and we urge Congress to support our state DOTs to ensure we have a robust national transportation network and vibrant economy.

 

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