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Uptick Seen for 2013 Transit Aid

Tuesday, February 19, 2013

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State and local funding for highway, bridge, and other transportation-related construction projects inched up to just over $117 billion in 2012, and the industry should squeeze out some gain this year as well, a new analysis shows.

In the monthly report, "Value of Transportation Construction Put in Place," the American Road & Transportation Builders Association (ARTBA) reported that state departments of transportation (DOTs) and local governments committed the $117 billion in funding. The analysis was based on data from the U.S. Census Bureau.

The association is also expecting modest growth for the U.S. transportation construction infrastructure market in 2013.

Funding Up, Activity Down

However, the report, compiled by ARTBA's chief economist, Dr. Alison Premo Black, found that construction activity accounted for 13.8 percent of all 2012 U.S. construction work put in place, down from 14.6 percent during 2011 and 15 percent in 2010.

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State and local DOTs obligated $117 billion for transportation construction in 2012, according to the American Road & Transportation Builders Association.

Although construction activity was down, the funding was a one percent increase over the $116 billion committed in 2011. Black noted that transportation construction activity fell well short of its $129 billion peak in 2010, which was largely attributed to the American Recovery & Reinvestment (Stimulus) Act.

Black's analysis also found the following changes:

  • Construction spending for highways was down 4.3 percent to $45.9 billion, compared to $47.9 billion in 2011, and was the only mode that did increase in 2012;
  • Up 4.5 percent from 2011, the $28.3 billion total was a record for bridge construction with a short-term boost possible from repair work on bridges damaged by Hurricane Sandy;
  • Airport runways were up 14.1 percent to $4.8 billion over 2011, suggesting the enactment of Federal Aviation Administration reauthorization legislation is having a positive impact;
  • Ports were up 10 percent to $1.6 billion with a strong year in preparation for the Panama Canal expansion;
  • Benefiting from the growth of freight shipments, railroads were up 7.3 percent to $10.3 billion; and
  • Subway and light rail exceeded the 2011 spending pace for most of 2012, ending up $6.6 billion over 2011, or 16.7 percent.

2013 Funds Show Increase

So far, federal, state and local DOTs have obligated $7 billion in federal funds during Fiscal Year 2013, according to ARTBA's latest analysis of Federal Highway Administration (FHWA) data. FY 2013 started on Oct. 1, 2012.

The funds show an increase of 56 percent over the $4.5 billion obligated during the same period last year.

The monthly report, "Obligation of Federal Highway Funds," found that the $2.3 billion obligated in January was 13 percent higher than in 2012, but 3.9 percent less than 2010, when state DOTs were rushing to obligate the last of their ARRA/Stimulus funds.

"The current obligation levels are much more in line with what we expect to see in the marketplace," said Black. "... [O]bligation levels were quite low in FY 2012 and FY 2011 as state transportation departments were dealing with a series of continuing resolutions for the federal aid program."

A 2013 forecast predicts modest growth for transportation infrastructure, but funds obligated so far show a 56 percent increase over the same period in 2012.

ARTBA's 2013 Forecast reports that the U.S. tranportation contstruction infrastructure market is expected to show modest growth in 2013, increasing three percent from $126.5 billion to $130.3 billion.

The forecast predicts that the bridge market, which has shown substantial growth over the last decade, will remain flat for the next year.

Growth is expected in highway and street pavements, airport terminal and runway work, railroads, port and waterway construction, and private work for driveways and parking lots, according to ARTBA.

Black noted that although obligations are off to a good start, there are still some unknowns ahead, and legislation to fund the federal government must be enacted before the end of March is states are to receive more than the $16.9 billion of highway funds that are required to be obligated by the end of the fiscal year.

About ARTBA

Established in 1902, ARTBA is the "consensus voice" of the U.S. transportation design and construction industry before Congress, federal agencies, the White House, news media, and the general public.

The Washington, D.C.-based association says its primary goal is "to aggressively grow and protect transportation infrastructure investment to meet the public and business demand for safe and efficient travel."

   

Tagged categories: Airports; American Recovery and Reinvestment Act; American Road & Trans Builders Assn (ARTBA); Bridges; DOT; Federal Highway Administration (FHWA); Government contracts; Rail; Roads/Highways; Transportation

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