Highway Infrastructure
States Receive $4.8B in 'Bonus' Federal FY20 Highway Funds
The Federal Highway Administration (FHWA) has distributed to states about $4.8 billion in uncommitted fiscal year 2020 highway aid, which state departments of transportation (DOTs) will use to build road and bridge projects.
[View FHWA announcement and state-by-state allocations here.]
The funds are part of FHWA’s latest annual August redistribution, announced Aug. 28, which in effect provides states with “bonus” money to supplement their regular core federal highway allocations.
“It's essentially kind of another bite at the apple,” says Susan Howard, American Association of State Highway and Transportation Officials (AASHTO) program director for transportation finance.
The catch is that state DOTs must obligate these funds to specific projects by Sept. 30.
States usually spend all of their annual core highway funding allotments, which are distributed by formula.
The redistributed total is the difference between the amount of obligation authority that FHWA had estimated early this year it would spend on certain national highway programs and a mid-summer re-estimate of how much it actually would commit by Sept. 30.
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Most of this year's $4.8 billion is unused Transportation Infrastructure Finance and Innovation Act funds and Infrastructure for Rebuilding America grants, according to AASHTO.
This year’s $4.8-billion redistribution is “an all-time high,” Howard says. Last year’s total was slightly less than $4 billion. The 2018 figure, the previous recent peak, was $4.2 billion.
[View 9/6/2019 ENR story on last year's redistribution here.]
Demand for the reallocated highway funds was strong again this year: states requested $7.2 billion, much more than the $4.8 billion available.
Each state, plus the District of Columbia, will share in the funding.
Top 5 states
The top recipient is California, with $493.7 million. Texas ranks second, with $470 million, followed by New York, with $280.5 million.
Florida, with $226.9 million, is fourth; Pennsylvania ranks fifth, with $210.3 million.
Howard says that the use of the August funds varies from state to state.
She adds, “But for a core group of states, they really depend upon the availability of August redistribution and they essentially plan for it.”
Matching shares
To put the August federal funds to work on projects, states still must come up with a matching share, typically 20% of total project costs.
Because of the coronavirus pandemic, state DOTs have been hit this year with a downturn in receipts from gasoline and diesel fuel as well as other transportation-related taxes and fees.
But Howard says AASHTO hasn’t seen much of a coronavirus-related financial impact on states seeking and using this August’s redistribution.
She says, “Before even the pandemic was on our horizon, folks had been planning for the availability of August redistribution and had kind of set aside that match.”
