Georgia to Use $350 Million of Contingency Funds for Transportation Work
Georgia will tap surplus transportation contingency funds for the first time to finance projects worth as much as $350 million to make up for the loss of federal stimulus funds and lower fuel-tax revenue.
The funds will be allocated by the end of December and spent in the first quarter of next year, David Spear, a spokesman for the Department of Transportation, said in a telephone interview today. The money is in addition to normal project outlays, he said.
Georgia’s spending on transport work has fallen during the past three fiscal years to less than $50 million a month from about $100 million monthly, Spear said. It could fall further as the department braces for the end of federal stimulus funds next year and declining revenue from fuel taxes.
Using contingency funds is “a stop-gap measure,” said Spear. “Highway contractors are laying people off and going out of business; we can’t afford to lose any.”
The 13-member Georgia Transportation Board, which oversees the department, unanimously approved the funding today in Atlanta, according to an e-mail release. The contingency fund, which held a surplus because of federal aid, will have about $250 million remaining after the disbursement, said Spear.
Federal stimulus funds contributed $750 million to the department since 2009, said Spear. Revenue from fuel taxes, which the department uses for operational expenses, fell to less than $800 million in fiscal 2010, which ended June 30, from $1.2 billion in 2007, he said.
“Long term, motor-fuel tax revenues are just going to continue to decline,” said Spear. To make up for the losses, an increase in the tax and new revenue sources such as public- private partnerships are being considered, he said.
Capital and Maintenance
The department will use $250 million of the contingency funds for capital and maintenance projects and $100 million for right-of-way purchases, the e-mail said. Projects will be selected from among 270 that would cost about $650 million to complete.
“This industry needs as much support as we can provide,” transportation board Chairman Rudy Bowen said in the release. “Our action today will end up creating and saving jobs across Georgia.”
To contact the reporter on this story: Simone Baribeau in Miami at sbaribeau@bloomberg.net.
To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net.
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