Mississippi DOT Sounds Alarm on Federal Highway Trust Fund, Outlines Consequences at Home

AASHTO Journal, 11 July 2014

Like most states transportation departments, Mississippi Department of Transportation officials are closely watching to see if Congress can find a way to keep the Highway Trust Fund afloat before the federal government begins to delay reimbursements for road and bridge work. Last week, MDOT Executive Director Melinda McGrath announced some immediate consequences should the HTF drop below adequate levels.

Specifically, McGrath said she would need to cut all state maintenance road and bridge project bids for this month.

“The Congressional Budget Office has projected revenues in the Highway Trust Fund will not meet current spending obligations as early as this month,” McGrath said in a statement. “MDOT’s highway and bridge project backlog will continue to grow with the loss of these federal funds. In the event Congress does not add revenue to the Highway Trust Fund, it will be necessary to pull all state-funded maintenance projects open for bid in July. This is something our state can’t afford. We are hopeful the Highway Trust Fund will be repaired to ensure MDOT may immediately continue with necessary transportation system preservation and construction projects.”

U.S. Transportation Secretary Anthony Foxx last week sent a letter to state transportation department leaders outlining steps USDOT will need to take should the HTF drop below $4 billion (see related AASHTO Journal story here), which it is scheduled to do by the end of the month, according to the USDOT HTF ticker. USDOT prefers to keep a minimum of $4 billion in the highway account in order to properly manage day-to-day financial transactions. At some point between when the account falls below $4 billion but before the account runs out of money, USDOT will need to institute cash management strategies designed to keep the account solvent.

Both the House and Senate are working on temporary HTF fixes, which could be up for votes in their respective chambers next week. More on the House and Senate proposals is available here.

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