Federal Agency Spending

Construction spending in Texas in 2008 by federal agencies — excluding federal highway aid and water projects — remains highly uncertain, due to Congress' delay in passing funding measures for most agencies. Only one federal construction bill had received final approval by early December, more than two months into the new federal fiscal year.

Additional uncertainty was created by cutbacks in a number of spending programs because of the demands to provide funding for military action in Iraq and Afghanistan, and demands by the White House to control spending. Favorable action, and increased appropriations, were anticipated for military construction projects in Texas. However, funding for other agencies was expected to show little or no increase, with an estimated total for federal projects put at $750 million,approximately $20 million above the previous fiscal years.

Spending by the Department of Defense in Texas is expected to exceed $385 million, after Congress determines specific amounts and projects. Continuing build-up of troops at Texas bases, including Fort Hood at Killeen and Fort Bliss at El Paso, is a major factor in the increase. Washington observers note that Texas lawmakers also are well-placed to ensure that the state's military facilities are well cared for, and the Bush administration has indicated support for increases in such funding.

Spending by the Federal Aviation Administration in Texas for fiscal 2008 is estimated at $103 million, with specific projects to be announced during the year by the FAA and members of Congress.

The General Services Administration is expected to spend $6.5 million in Texas for new construction work and major rehabilitation projects in fiscal 2008.

A major unknown in the amount of spending is how much money may be allocated to funding for facilities intended to promote security along the Texas-Mexico border. Texas Gov. Rick Perry (R) has been advocating increased attention to border security along the Rio Grande, but the funding for projects appears to be caught up in the larger debate over immigration control. The Department of Homeland Security is expected to have a role in any security projects eventually authorized.

The National Aeronautics and Space Administration is expected to have some work at the Johnson Space Center in Houston when final funding is settled. Construction spending by NASA at the Houston facility is estimated at $4,175,000.

Funding for construction work by the Department of Veterans Affairs is estimated at $16,350,000 for 2008, based on expected increased need for services for returning troops and updating of existing facilities. Funding for the department may be placed in an omnibus spending measure.

The Rural Utilities Service is expected to underwrite $113 million in loans in Texas for electrical, water and wastewater, and telecommunications facilities, up slightly from prior years as the state's population continues to grow and development in rural areas continues. While demand for construction of major generating facilities has been down in recent years, demand for transmission facilities has continued to grow.

The National Resource Conservation Service is expected to conduct approximately $6 million in construction work in the state. That would continue work on watershed protection at approximately current levels.

Construction funding assisted by programs under the U.S. Department of Agriculture in Texas is estimated at $130 million for the new year. However, a decision on final funding for the USDA may be delayed until early in 2008. Rural housing, water and wastewater systems, fire prevention services, community centers, and other projects are financed under USDA programs. Officials at the USDA Texas state office report that applications for assistance are continuing to increase.

The U.S. Department of Justice is expected to spend some $1.3 million or repairs and renovation work. Security equipment and security upgrades are expected to account for the bulk of the activities.

Funding to the Department of the Interior is estimated at $1.27 million for improvements at federal park and wildlife refuges in Texas. No major new projects are anticipated.