States get ‘flexibility’ in using federal highway money

Arkansas should receive just short of $7 million in “unobligated” funds authorized in federal legislation dating back to 2003.

None of the money is designated for projects in Northwest Arkansas or the Fort Smith metro area. However, some of the unobligated funds could be redirected to other projects.

The U.S. Department of Transportation announced Friday (Aug. 17) the money can be spent by state highway agencies on roads, bridges and other transportation infrastructure. The department is set to release $473.371 million from an original allocation of $948.551 million.

“Effective today, state departments of transportation will have the ability to use their unspent earmarked highway funds, some of which are nearly 10 years old, on any eligible highway, transit, passenger rail, or port project,” noted the Department of Transportation statement. “States must identify the projects they plan to use the funds for by October 1, and must obligate them by December 31, 2012.”

The pitch from the department and from the White House was that state officials must “use it or lose it” as part of an effort to create jobs.

“We are freeing up these funds so states can get down to the business of moving transportation projects forward and putting our friends and neighbors back to work,” Transportation Secretary Ray LaHood said in a statement released by the White House.

There were numerous reasons that the money from earmarks wasn’t spent, Chris Bertram, the agency’s chief financial officer, said at the briefing. According to Bertram, the reasons include projects that were blocked after environmental review, projects that cost less money than projected and states that couldn’t afford to begin construction work. Bertram’s remarks were reported by Bloomberg News.

Arkansas has $6.966 million unobligated funding originally attached to five projects. Those projects are:
• Arkansas Highway 226 improvements near Jonesboro: $1.5 million
• Jonesboro transportation and drainage planning: $192,702 ($807,298 previously released for the project)
• Interstate 530 extension planning: $13,103 ($724,843 previously released for the project)
• Northeast Arkansas connector/Highway 226 (near Jonesboro): $4.919 million
• Railroad overpass in Marion, Ark.: $341,500 ($5,000 previously released for the project)

Randy Ort, spokesman for the Arkansas Highway & Transportation Department, said the amount coming to Arkansas is “not anything to write home about,” but the flexibility given to previously earmarked funds is something he hopes “sets a precedent.”

“The net impact is not great in this case, but we’re very pleased that Congress saw fit to provide this flexibility,” Ort said. “Basically they are saying if we have projects ready to go, we can spend that money.”

Of the $6.966 million coming to Arkansas, $6.419 million will be spent on the Highway 226 work in northeast Arkansas. Ort said that money likely would have been spent before the end of year without today’s DOT announcement.

However, officials will have to decide if the almost $550,000 targeted for planning is needed or can be effectively obligated by Dec. 31, Ort explained.

According to DOT info, Oklahoma has $8.148 million remaining for 19 projects, and Missouri has $6.316 million for 22 projects.

The top five states with unobligated funds are:
• Alabama: $51.488 million
• California: $43.075 million
• Texas: $30.795 million
• New York: $29.031 million
• Pennsylvania: $28.536 million

Ort said the $473 million spent around the U.S. will increase jobs.

“I think any time you spend money on highway construction projects, it means jobs,” Ort said.