Stimulus Starts to Flow
By mid-summer, stimulus dollars provided through the American Recovery and Reinvestment Act were flowing in spurts and trickles through the Mid-Atlantic. Some government agencies were quicker to mobilize than others, and throughout the region eager contractors lined up en masse for a chance to bid.
In transportation, Maryland was among the first states to award stimulus projects, and had advertised all but eight of its nearly $450 million in projects by August. Pennsylvania also moved quickly with its $1 billion in ARRA funds, beginning work on 178 projects valued at $420 million by late July. Its largest award at that point was a $23.4 million contract awarded to Trumbull Corporation of West Mifflin, Pa., for preservation of the I-279 Fort Duquesne Bridge in Pittsburgh.
The frenzy among contractors to pick up work during a tough recession played to the favor of PennDOT, which saw bids come in at 11% below estimates on average. As a result, the state was able to use the unspent funds to add 52 more projects to the program.
“We can stretch these critically needed recovery dollars even further and reach even more areas of Pennsylvania,” Gov. Edward Rendell announced on July 28.
But stretching dollars has led to thin margins for many contractors on ARRA projects. Seth Myers, business development manager at American Infrastructure in Worcester, Pa., says his company has seen lists of bidders on projects double in length from last year with bids sometimes coming in at more than 30% below estimate.
“You scratch your head and wonder if people are just throwing out bids below cost in the short term so they can keep the lights on,” he says. “Some of these numbers are crazy. This can’t last forever.”
Maryland State Highway Administration has also seen savings on its ARRA projects, with bids coming in around 10% below estimates, according to SHA Spokesperson David Buck. No decisions would be made on how to use the unspent dollars until after all projects are awarded, he said.
Virginia is the next big state in the region to get transportation projects going. By late July, VDOT had allocated nearly half of its $694 million in funding with many of its smaller projects, such as paving jobs, awarded.
