The American Road & Transportation Builders Association (ARTBA) is forecasting that beyond a modest increase in construction costs nationwide, the overall U.S. transportation infrastructure construction market will grow 5% from $129 billion this year to $135.8 billion in 2014.
ARTBA Chief Economist Dr. Alison Premo Black said the market would be led by expected double-digit growth in airport runway and terminal work, a 6% increase in bridge and tunnel construction and 5%, or better, growth in total investment in waterways and ports, and heavy and light rail.
Uncertainty about the level of federal support for state highway programs after next September, however, will continue to depress the road pavement market next year.
Black forecasts the pavement market will grow to $54.4 billion in 2014, up 2.6% nationally. This includes $42.7 billion in public and private investment in highways, roads and streets, and $11.6 billion in largely private investments in parking lots, driveways and related structures. The market, however, will be uneven nationwide, she said. ARTBA forecasts paving work to be up in 19 states, down in 20 and largely flat in the remaining 11.
“Over the past 10 years, on average nationally, federal funding has provided 52% of the money invested by state transportation departments in road and bridge capital improvement projects,” Black said, noting, “The federal share ranges from 35% in New Jersey to over 70% in 11 states.”
“Absent Congressional action to improve the revenue stream into the federal Highway Trust Fund before next October, federal support for state programs faces a potential $40 billion cut in fiscal year 2015,” she said. “That uncertainty is already putting a damper on state project lettings. Congress needs to act.”
“If the federal program can be at least stabilized, the longer term outlook for pavements could be much more positive,” Black said. “Bipartisan political support for significantly increased transportation investment has been seen in a number of bellwether states this year, including Pennsylvania, Virginia, Ohio, Maryland and Massachusetts. Wyoming and Vermont passed gas-tax increases for expanded investment. Eighty-five percent of the 2014 transportation investment ballot initiatives passed. And the public-private investment market is picking up with the expansion of the federal loan guarantee program.”