analysis: half a trillion dollar shortfall
24 April 2008
Last year the construction industry lauded the passage by Congress of the six-year, $286.4 billion transportation bill that promised to strengthen and modernize the transportation networks vital to America's continued economic growth. While the legislation was a move in the right direction in terms of providing funding for many sorely needed transportation projects around the country, the fact of the matter is that much more money is needed to repair crumbling bridges, viaducts and roadways.
According to the Associated General Contractors, 33% of major roadways in the US are in poor to mediocre condition, 27% of US bridges are structurally deficient or functionally obsolete and 37% of America's major roadways are clogged with traffic. The Transportation Equity Act for the 21st Century (TEA-21) will address some of these infrastructure issues, but still will not come close to covering the cost of what needs to be done, according to Christian Klein, who is with the Washington Council of the Associated Equipment Dealers.
“This was a six year bill and each year Congress has to come back and appropriate the money to be spent for the next year,” he says. “We will continue to press to make sure these promises are fulfilled. But the next big thing is identifying where the money is going to come from [for transportation projects] in the future. What is going to be spent and what should be spent to maintain current conditions, just to prevent things from getting worse, we're going to need a half a trillion dollars more.”
Aging infrastructure is a concern that is becoming front and center for many regions and for the construction industry in particular, says Doug Ball, vice president of the Specialized Carriers & Rigging Association.
Bridges are especially a problem when it comes to the transport of heavy, oversize, over-dimensional loads, which in many cases are construction equipment or components required in building new bridges. “We are extremely concerned about the ability of weakened infrastructure to handle over dimensional loads and the requirements of specialized carriers,” Ball says.
How can a truck haul in a crane, excavators or even concrete bridge spans needed to repair a bridge if the bridge itself is in such bad shape it can't be used for the transport? This is a question that SC&RA members are working to get answered. Essentially the answer is more funding for roads and bridges.
Klein says the AED, AGC and other construction organizations must keep the pressure on Congress to assure the money set aside for transportation continues to be spent for its intended purpose and that Congress and the President look for new revenue sources to address growing needs.
In their lobbying efforts, the construction industry is also focusing on assuring that “firewalls” in the legislation are not violated and funds used to support other federal spending.
“The market implications of the legislation are positive,” says Klein. “Our rule of thumb is seven cents on the dollar to construction equipment dealers, that's the market impact. That means an approximate $2.8 billion economic impact in a one-year period.”
President Bush's budget released last month included an appropriation for approximately $39 billion for transportation funding for 2007.