What Might Friday Mean for Construction?

April 24, 2017
What Might Friday Mean for Construction?

Congress has just days to approve a budget for the fiscal year that began Oct. 1. If it does not act by April 28, when a stopgap funding measure expires, much of the government will shut down.

Joung Lee, policy director for the American Association of State Highway and Transportation Officials, said while most Highway Trust Fund programs should continue to operate as normal, a shutdown could disrupt federal programs that rely on annual funding appropriations to assist various transportation modes.

In some cases, such as with mass transit grants from the Highway Trust Fund, a furlough of Federal Transit Administration staff that are paid out of the general fund will suspend grant-making activities.

Congressional leaders have said they intend to complete a budget agreement in time to avoid even a short shutdown of agency operations, but the risk remains until they vote for one and the president signs it into law.

"We are hopeful that Congress will avoid a shutdown, and that it will finally approve a 2017 budget that allows for expected funding increases in a range of transportation programs," Lee told the AASHTO Journal.

During the last shutdown, in October 2013, the Department of Transportation's furlough plan affected thousands of workers, including nearly all transit staffers, more than a third of those in aviation, more than half of highway safety and pipeline safety employees, much of the maritime and rail program staff, and most workers assigned to the Office of the Secretary.

Outside of the USDOT, a shutdown could affect waterway improvements handled by the Army Corps of Engineers, or grant programs at other departments that benefit transportation projects.

Lee said that because the government has operated since October at 2016 funding levels, the funding freeze has deprived state DOTs nationwide of about $1 billion in additional highway funding they are scheduled to receive this year under the Fixing America's Surface Transportation Act.

Some governors and state DOT executives from cold-climate states with short construction seasons have told Congress the delay in providing the 2017 road funding increases could cause them to put off some highway projects they would otherwise begin this year.

That 2015 FAST Act also provided for annual increases through 2020 in the transit programs it covers, plus highway safety programs – increases that have not yet kicked in for lack of a 2017 budget agreement. It provided for a one-year, $199 million disbursement in 2017 to help railroads deploy crash-avoidance systems, but the FRA has not been able to disburse those funds either.

In addition, Congress since 2009 has approved annual infrastructure grant appropriations from the general fund for the USDOT's TIGER program, but any potential TIGER funding for 2017 awaits a budget deal.  President Trump has suggested that Congress drop the program starting in 2017, and his preliminary budget plan for 2018 proposed no TIGER funding since the FAST Act provided for a larger annual grant program with similar features.

"We and others in the transportation industry are watching the budget process closely," Lee said. "A lot of program funding, for various modes, is hanging in the balance."

Note: The 2013 Department of Transportation's furlough plan provides the type and scope of workers and projects that would be affected by a government budget shut down.