State DOTs Request $50 Billion In Emergency Relief Amid COVID-19 Pandemic

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As the impact of the COVID-19 pandemic continues to take hold over our nation, state departments of transportation (DOT) are beginning to see a dramatic revenue loss as Americans stay in quarantine. To combat these losses, the American Association of State Highway and Transportation Officials (AASHTO) urged Congress this week to provide $50 billion in emergency relief and a six-year, nearly $800 billion surface transportation reauthorization bill.

AASHTO’s $50 billion revenue request is 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. Currently, state DOTs are estimated to lose approximately  30% of transportation revenues over the next 18 months. The $50 billion request is based on how state DOTs collect revenue, which under 2018 numbers included: 43% ($78.4 billion) in highway user fees and tolls, 23% ($42 billion) in federal grants, 18% ($33.6 billion) in other state funding, 13% ($23.8 billion) in bond issuance, and 3% ($4.7 billion) in payments from local governments. While this total includes around $112 billion in state DOT revenue a current, and growing, 30% reduction in transportation revenue would lead to a near $50 billion revenue shortfall.

Additionally, as states are beginning to see a decrease in transportation user fee revenue, it is anticipated that the Highway Trust Fund (HTF) will see a similar decrease. It is projected that under the best-case scenario, the HTF could see a decrease of $3.9 billion, to a total collection of $39.7 billion ($43.6 billion was collected in 2019). Under the worst-case scenario, the HTF could see a decrease of $7.4 billion, to a total collection of $36.2 billion.

AASHTO has also requested  a six-year, nearly $800 billion surface transportation reauthorization bill,  intended to eliminate the longstanding investment backlog by the end of the decade, meet current needs, and  support economic recovery. Under the recently released US DOT Conditions and Performance Report, AASHTO cites a combined $902 billion investment backlog, or $786 billion in highway and $116 in transit needs. While their request calls for doubling the amount of federal funding from the FAST Act, these actions would end the longstanding investment backlog and meet arising asset condition and performance needs to support and sustain our multiyear economic recovery and growth.

As Congress looks to the next phase of relief for the COVID-19 pandemic, ASCE late last week urged Congressional leadership and President Trump to make infrastructure investment a priority, including a reauthorization of surface transportation programs.  ASCE has asked Congress to include a multi-year surface transportation reauthorization that addresses long-term HTF solvency, and modernizes our roads, bridges, and transit systems.

Currently, our nation’s road and bridges are significantly underfunded, resulting in a $836 billion backlog of highway and bridge capital needs. The bulk of the backlog ($420 billion) is in repairing existing highways, while $123 billion is needed for bridge repair, $167 billion for system expansion, and $126 billion for system enhancement. Additionally, despite increasing demand, transit systems have been chronically underfunded resulting in a $90 billion rehabilitation backlog. Under the current pandemic, these figures are likely to grow, widening our infrastructure funding deficit.

Now is the time for action. Lawmakers must include infrastructure investment in future COVID-19 relief and stimulus packages to ensure our nation can have a world-class infrastructure fit for the 21st century.

 

 

 

 

 

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