Prices for infrastructure-related project materials continue to rise under the Trump administration’s steel tariffs, causing several states to rework their budgets in 2019.
In Dover, New Hampshire, for example, officials are reworking their budget after the winning bid on a flood-control project came in $1.5 million higher than its anticipated $3.3 million. The project involves installing hundreds of feet of steel-reinforced concrete pipe. According to the Wall Street Journal, this could lead the state to consider making cuts, or “forgoing other projects.”
“We’re seeing steel and a lot of commodities going up, as well as labor,” said Glenn Cairns, president of George R. Cairns and Sons. “Everything is on the rise.”
The article reports that through October, the price of diesel fuel was up 27 percent, asphalt-paving material up 11.6 percent, and steel mill projects up 18.2 percent. Recent tariffs on 25 percent of foreign steel have given U.S. steel makers the ability to raise their own prices.
“If these tariffs remain in effect, they are likely to drive highway, bridge and other construction costs even higher once items in inventory ordered before the tariffs took effect are used up,” said Ken Simonson, chief economist of the Associated General Contractors of America, was quoted as saying.
In New Hampshire, there has been a surge in steel prices since this summer of about 30 percent.
In Florida, the state transportation department agreed to spend $7 million more on projects to alleviate the increased costs.
In Southern California, the Foothill Gold Line Construction Authority said it will cost an additional $570 million to build a 12.3-mile light rail extension outside of Los Angeles. As of now, most teams can only rebid in hopes of receiving additional funding later.
Source: The Wall Street Journal