CAWP Legislative News 2-10
Key Construction Programs See Funding Cut in President’s Budget
Last week, President Obama unveiled his $3.8 trillion budget for fiscal year 2011. The budget projects a deficit of $1.27 trillion while placing a total freeze on non-security domestic spending. That freeze has resulted in cutbacks in most of the key federal construction accounts. According to Associated General Contractor’s analysis, the Administration’s proposed total of $112.4 billion for construction projects represents a nearly $9 billion, or 7.5 percent, decrease from the $121.5 billion appropriated for construction projects in FY 2010 (this does not include ARRA funds).
While the budget recommends a mix of increases and reductions in programs across market areas, it does recommend boosting a few construction programs (albeit very modestly) including one percent increases for both the highway and transit programs. In addition, the Administration is calling for the creation of a $4 billion National Infrastructure Bank for transportation projects of regional or national significance.
In contrast, the proposed budget cuts the construction budget for the Army Corps of Engineers’ Civil-Works Program from $2 billion in 2010 to $1.7 billion, a 17% decrease. The Environmental Protection Agency budget would cut the Clean-Water State Revolving Funds by 5% to $2 billion and the Drinking Water State Revolving Funds by 7% to $1.2 billion.
The President’s budget is simply a request of the Administration’s priorities for the next fiscal year and the first step in the federal budget process. AGC will continue to advocate for the increased federal investment in the nation's infrastructure and public facilities through the nearly 100 construction programs at the federal level.
Other Aspects of the Budget from the American Highway Users Alliance
• Includes a substantial request for increasing the number of Department of Transportation employees (+13.6%), including more than 100 new full time employees to help the Secretary with a newly proposed $4 billion discretionary infrastructure fund.
• Reserves $200 million in FHWA funds to support the Administration’s half a billion dollar “livability initiative” designed to support “transportation choice and integrate housing and land use into transportation decisions”. The livability initiative has also been described by Department staffers as money and technical assistance for local governments and non-profit organizations that want to plan communities where one doesn’t need a car. It appears that EPA and HUD personnel would also have a significant role in deciding who receives livability funding.
• Proposes an additional $1 billion in funding for “high speed” rail.
• Does not include the $27.5 billion in highway funding passed by the House in the Jobs Bill.
The American Highway Users Alliance is a nonprofit organization serving as the united voice of the transportation community promoting safe, uncongested highways and enhanced freedom of mobility.