Louisiana Gov. Bobby Jindal has decided to sell bonds one year at a time to finance its program of $325 million in rural road improvements rather than selling all three years of bonds at once, The Advocate, Baton Rouge, reported. The action, announced on Friday at 7 p.m., took the state’s treasurer by surprise.
“That is news to me,” John Kennedy, state treasurer and chairman of the state bond commission. “I though we had agreed that we would sell the bonds and lock in low interest rates and then draw them down as we needed them.”
“Because borrowing costs are higher than expected and interest rates are predicted to stay low, it does not make good fiscal sense for the state to borrow more money than is needed,” Sherri LeBas, secretary of the Louisiana Department of Transportation and Development (LaDOTD), said in an e-mail released last Friday evening.
Kennedy told The Advocate the economy was likely to be better in three years, so bond interest rates will likely be higher as well, meaning less money available for rural road projects.
Kristy Nichols, commissioner of administration for the state, told The Advocate selling all the bonds in the first year would require an interest payment for the full amount in the first year. The state hopes to save money by spreading the interest payments over three years.
LaDOTD invested more than $668 million in transportation infrastructure projects in 2012, resulting in 372 projects that helped to improve over 1,000 miles of Louisiana’s roadways and 71 bridges, the agency announced in a year-end review.
LeBas said, “DOTD is committed to projects that will preserve our highway system, improve travel, enhance safety, and create economic opportunities throughout the state.”
The state continues to prioritize projects along major corridors and has reduced Louisiana’s backlog of road and bridge needs by nearly $2 billion. The continued investment has helped to create a safer and more efficient highway system for drivers in Louisiana.
The passage of key legislation to bond the State Highway Improvement Fund (SHIF) revenue stream for nonfederal-aid routes, combined with the SHIF’s regular funds, allowed for the implementation of the Quality Surface Program. This more than $425 million initiative will resurface and repair approximately 1,100 miles of roadways across the state, many in rural areas, which in some cases haven’t been touched in over 30 years.
In February, DOTD celebrated an I-49 South milestone with the completion of the U.S. 90 Frontage Roads project from La. 83 to Darnall Road. This $5.4 million, 2.75-mile, project constructed new frontage roads and, in some areas, converted portions of the existing service roads to frontage roads. Additionally, in October, DOTD marked another I-49 South achievement with the completion of the U.S. 90 widening project. This $20 million capacity project widened U.S. 90 from four to six lanes from Pinhook Road to Broussard. The I-49 South project will ultimately convert U.S. 90 from Lafayette to New Orleans into an interstate-quality roadway.
Also in February, construction on the new $409 million John James Audubon Bridge came to a close under the Transportation Infrastructure Model for Economic Development (TIMED) Program. With a 1,583-ft main span, the new bridge is one of the longest cable-stayed bridges in the Western Hemisphere, connecting Pointe Coupee and West Feliciana parishes. While the bridge itself is a significant engineering achievement, it is also the first design-build project undertaken by DOTD.
Through the Destination Zero Deaths initiative, Louisiana has seen a dramatic 32% reduction in traffic fatalities with the unified efforts of the Federal Highway Administration, Louisiana Highway Safety Commission, Louisiana State Police and DOTD working in cooperation with local public works departments and local law enforcement.