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Texas Construction 2009 - Bad News and Good News

President-elect Barack Obama has given indication that he will be a proponent of infrastructure construction as a method of creating jobs and improving the economy. It worked during the Great Depression of the 1930s; everyone is ready for it to work again. State and local infrastructure departments have their lists of projects ready in hopes of an economic stimulus plan.

January 05, 2009

President-elect Barack Obama has given indication that he will be a proponent of infrastructure construction as a method of creating jobs and improving the economy. It worked during the Great Depression of the 1930s; everyone is ready for it to work again.

State and local infrastructure departments have their lists of projects ready in hopes of an economic stimulus plan. Contractors will be able to go back to work, buy more construction materials, and be able to hire more workers.

At the federal level, most appropriation bills – and so funding for new projects – remained stalled. Congress has approved a continuing resolution to keep agencies operating at current levels until March 2009, but with a few exceptions, no funding for 2009 projects has been finalized. Those exceptions include the Department of Defense, Department of Veterans Affairs and Department of Homeland Security. Otherwise, “there can't be new projects authorized or appropriations made until Congress acts again,” a senatorial staff member noted. That isn't expected to occur until the new Congress convenes in January and the new administration takes office.

Transportation

TxDOT (Texas Department of Transportation) and the other 49 state highway departments have their wish lists at the ready. TxDOT has identified $5 billion worth of construction and maintenance projects that are ready to let. Texas Transportation Commission Chairman Deirdre Delisi took the initiative to send letters to the Texas Congressional Delegation concerning the most efficient use of transportation funding in any economic stimulus plan. Some of her comments included:

  • “Sending funds uncommitted to specific projects will help us put the money to work in the fastest possible manner. Based on our current estimates, TxDOT could accelerate $5 billion worth of construction and maintenance projects between January and August 2009.
  • “Stimulus monies should come to states in an almost block grant manner and not be funneled through the existing myriad of federal funding categories.
  • “Projects that utilize this funding should be granted an expedited status that accelerates project development.”

Delisi used the I-35 Minneapolis bridge and the South Texas Queen Isabella Causeway emergency rebuilds as examples of streamlining the environmental process.

Vertical Construction

The outlook for the vertical market is not nearly so hopeful. The bond market is virtually shut down. Hospital and school construction, such strong markets over the past several years, depend on bond sales, philanthropic donations and endowments tied to the stock market. With those drying up, even the schools and municipalities that passed bond elections in November will become very thoughtful about moving forward with their construction plans. President-elect Barack Obama's economic stimulus plan includes monies for hospitals and schools. The funds will be required to be used immediately – that includes the resumption of construction that has been interrupted due to lack of funding as well as projects that are ready to be built. With this funding hitting in mid-winter, we in the southern states will be in the catbird seat. Dirt can start flying here immediately. n

FEDERAL
Department of Defense $385,000,000
Federal Aviation Administration 98,000,000
General Services Administration 4,200,000
Department of Energy 6,500,000
NASA 4,125,000
Department of Veterans Affairs 16,550,000
Rural Utilities Service 107,000,000
Natural Resource Conservation Service 5,000,000
U.S. Department of Agriculture 123,000,000
Department of Justice 1,300,000
Department of the Interior 1,270,000
Federal Highway Administration 2,500,000,000
TOTAL $3,251,495,000
STATE
Texas Department of Transportation $3,500,000,000
State Agencies 350,000,000
State Universities 1,435,000,000
TOTAL $4,285,000,000
WATER PROJECTS
Corps of Engineers $110,000,000
Bureau of Reclamation 500,000
River Authorities 910,000,000
Clean Water State Revolving Fund 695,000,000
Drinking Water State Revolving Fund 411,000,000
TOTAL $2,126,500,000
BUILDINGS TOTAL $20,230,000,000
GRAND TOTAL $29,892,995,000

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