California Transportation Director Cindy McKim says that if the current budget impasse continues through the end of August, “transportation-fund cash balances may be depleted, resulting in potential suspension of ongoing construction projects.” McKim says that if the logjam extends into September, the department would have to stop or delay the start of $3 billion worth of transportation projects, plus delay contractor payments on $9.5 billion worth of current construction. “The absence of fiscal year 2010-11 budget authority has an immediate result of restricting Caltrans’ ability to initiate construction projects, award contracts and make payments to vendors,” says McKim. The fiscal year 2010-11 began on July 1. In short, no budget means the delay of $1.3 billion in project awards, delay of more than $900 million of projects that were allocated with prior-year budget funds and delay of nearly $650 million of bond-funded projects until the state treasurer’s office can complete the bond sale, which will not happen until a state budget is passed.
California Budget Fiasco Endangers $3 Billion Worth of Construction Work
August 18, 2010