By Dr. Alison Premo Black, chief economist, ARTBA
States obligated a total of $3.5 billion in federal-aid highway construction funds in June, according to the latest data from the U.S. Department of Transportation.
With three months left in the federal fiscal year, this brings the total to $26.8 billion – two-thirds of the amount that must be obligated before Sept. 30. The pace of obligations is in line with previous years and indicates that states are continuing to move forward with federal-aid projects despite the greater economic uncertainty.
A dozen states have obligated over 80 percent of their federal dollars – Alaska, Colorado, Georgia, Maine, Tennessee, North Dakota, Alabama, Texas, Utah, Montana, Rhode Island, and Idaho.
States that had obligated 50 percent or less of their federal funds, as of June, include South Dakota, Virginia, New York, Hawaii, Kansas, Illinois, West Virginia, Missouri, and Maryland.
An obligation is when the federal government commits to pay or reimburse the states for its share of the eligible project. In most cases funds are obligated for a project before state transportation departments put the work out to bid, and thus can be a leading indicator of market activity. States must obligate their formula funds before the end of the federal fiscal year.
Detailed information by state is available as part of ARTBA’s Transportation Construction Market Intelligence Service.