The Arkansas State Highway and Transportation Department (AHTD) restored 27 of the 87 highway construction projects put on hold in its October bid opening.
Congress extended the Moving Ahead for Progress in the 21st Century Act (MAP-21), a bill that funded surface transportation programs in 2013 and 2014, until Oct. 29 2015, making the reinstatement of the projects financially possible.
The new legislation also transferred $8.1 billion from the General Fund to the Federal Highway Trust Fund, keeping the Federal Highway Administration from having to implement cash management procedures until the spring 2016.
Contractor payments on federal projects are first paid with state funds, after which the state seeks reimbursements of approximately 80% from the Highway Trust Fund for the federal portion of those payments. If the AHTD is uncertain if it can get that federal portion the projects are subsequently withdrawn.
Arkansas relies on federal funding to pay for highway construction projects and this new source of funds will provide some relief for AHTD until Spring 2016. In addition, the state has asked Gov. Hutchinson for $35 million of state surplus money to support the program for 2016.
“Other state departments of transportation can tap into other sources of funds, including a line of credit from their general state revenue to keep projects going, but Arkansas cannot. We have no way of raising revenue to offset the reduction, delay or loss of federal dollars that Arkansas depends upon for 70 percent of its highway construction program,” AHTD Director Scott Bennet said in a news release.
