Bond borrowing by states and cities for transportation infrastructure has dropped  to the slowest pace in at least a decade, even though interest rates are near a 50-year year low and project backlogs are historically high.

About $14.8 billion of municipal debt has been sold this year for highway, airport and transit projects, on pace for the smallest amount since at least 2005, Bloomberg reported Oct. 6, based on data through Sept. 30.

One reason for the lack of borrowing is that local officials, stung by budget shortfalls after the recession, have been leery of taking on new debt. Instead, they’ve been seizing on low interest rates to refinance higher-cost bonds.

Borrowing for new highway, airport and transit projects reached a record $65 billion in 2010, the last year of the federal Build America Bonds program, or “stimulus bill,” Bloomberg data shows. The initiative paid a share of the interest bills on taxable debt sold for public works, which prodded local governments to borrow.