Highway delays ahead

Funding falls flat as costs soar

More highway project delays are coming as the state Department of Transportation adjusts to a bleak new forecast for flat state and federal funding along with unrelenting increases in construction costs.

North Carolina will have about $920 million less than it needs for the road-building, maintenance and other transportation work planned for the next three years, said Lyndo Tippett, state transportation secretary, on Wednesday.

He pegged most of the gap to a projected $720 million shortfall in federal allocations and $115 million less than previously expected from the state Highway Trust Fund. Tax revenues are flat because gas consumption and new car sales have declined. Construction costs have risen by 45 percent in the past three years.

"There's simply not enough to go around. Adversity brings pain to us," Tippett told members of the state Board of Transportation. "And gain for others," he added, citing record profit reports from Chevron, Exxon and other petroleum firms.

Mark L. Foster, DOT's chief financial officer, outlined ways to find revenues and cut spending to keep the department from running into the red as soon as October.

"We obviously don't want to have to shoulder this by ourselves," he told board members. "But if we did, we know what we'd have to do."

Foster said North Carolina would have to look increasingly for money from tolls and other highway user fees.

Two legislative committees will discuss transportation spending needs next week. Some General Assembly leaders have promised to stop the practice of taking $80 million from the Highway Trust Fund for nontransportation needs each year. Foster said he hopes the legislature also will agree to repay $125 million transferred from the trust fund in 2002.

There's no single solution, he said, short of drastic action such as a 12-month construction halt.

"We're a construction business," Foster said in an interview. "You're not going to shut down all new construction for a year. That would turn us into a maintenance shop."

DOT leaders are expected to delay a number of projects when they update the state's seven-year transportation plan late this summer.

State officials thought they had done enough to balance the books last year when they cut construction spending from about $1.3 billion to $650 million annually for the next three years. Later in the year, a four-month delay in construction schedules provided further savings.

The delays and a separate cut in Triangle funding set back major local projects including Durham's East End Connector, extensions to Interstate 540 in Wake County and the widening of U.S. 401 from Raleigh to Franklin County.

Joe Bryan of Knightdale, a Wake County commissioner who is chairman of the county's transportation planning agency, said Triangle residents will have a hard time accepting further setbacks.

"We've got gas prices at an all-time high in the United States, and now we're hearing this unbelievable news of a shortfall in revenues to meet our transportation needs," Bryan said.

He said it is unacceptable to hear that North Carolina's return on federal gas taxes is getting worse instead of better. Wake and other urban counties also pay more than their share of state transportation taxes, he said.

"It is more bad news piling up for us, particularly for urban areas that are becoming more congested," Bryan said.