California construction is getting pandemic relief with an expected $910 million as part of a $900-billion COVID-19 measure passed by Congress on Dec. 21. The final, year-end legislative package includes $10 billion in emergency aid for state transportation departments.
“This is welcome news,” says Peter Tateishi, chief executive of Associated General Contractors of California. Noting the hit that Caltrans sustained due to the pandemic-induced decrease in gas tax revenues, Tateishi adds, “We are excited to see this money come in and offset those missed revenue marks and some of the other losses caused by the Covid pandemic.”
Tateishi says AGC is hoping to see guidance on the funding by late January or early February, but that the transition of presidential administrations might slow things down.
The $910-million figure is based on FAST Act distributions, says Caltrans spokesperson Chris Clark. This “flexible funding” will allow the agency to proceed with work on all programmed projects, including awarding construction contracts, despite the decline in state-collected fuel tax revenue, he says.
“The funding primarily serves to bolster the existing program of projects and provides a portion of the projected lost fuel tax revenue due to the COVID-19 pandemic,” says Clark. “The 2021-22 Governor’s Budget, released last week, estimates that the current fuel tax estimates are about $1.5 billion lower than pre-COVID estimates through the 2024-25 fiscal year. Significant new federal funding would be required to provide a sufficient basis to accelerate major new projects.”
Carol Church, director of transportation and operations for the Rebuild SoCal Partnership, says the funds allocated to the state DOTs will provide “much-needed jobs” to the construction industry and “ensure that our infrastructure will receive the attention it needs to keep us safe and expand to help meet our needs for future projects."
The nearly 6,000-page bill was analyzed by the policy department of the American Association of State Highway and Transportation Officials. The organization says that the $10 billion for COVID-19 relief set aside for state DOTs must be apportioned by the Federal Highway Administration within 30 days of the bill’s enactment and will be based on each state’s share of obligation limitations within the recently extended Fixing America’s Surface Transportation Act.
AASHTO’s analysis also found that the relief money can be used by state DOTs to fund projects that are eligible for Surface Transportation Block Grants. Administered by FHWA, the STBG program provides flexible funding to states for use on programs that preserve and improve conditions and performance on any Federal-aid highway, bridge and tunnel project. STBG funds can also be used for transit capital projects, including intercity bus terminals.
The federal COVID-19 relief measure also includes about $46 billion in continuing federal aid for highway and transit programs.
