Alison Premo Black, senior vice president and chief economist at the American Road & Transportation Builders Association (ARTBA) presented a webinar on what the construction industry has seen in the first half of 2018 and what to expect as the year rolls on.
According to the webinar, total transportation construction activity year-to-date is up 5 percent ($47.8 billion) from 2017 ($45.8 billion).
“After the five months of 2018 recorded, we’ve completed about 34 to 35 percent of all of the work we will see in a year,” said Black. “If the current trend continues, at year-end we should see $136.5 billion in activity ($134 billion in 2017). That would equate to a real growth of about 2 percent for total transportation construction activity in 2018.”
In addition, growth for highway construction alone should be up 2 to 3 percent for the entire year.
While bridge construction is down 8 percent in 2018 ($2.8 billion in 2017), airport construction is more than making up with more than a 64 percent growth in 2018.
With the lack of an infrastructure bill, states are starting to come up with their own funding measures. Currently, there are 215 transportation-related funding bills in 2018 in 39 different states.
In 2017, voters approved $4.25 billion in transportation funding initiatives and while it is still very early in the November 2018 election process, there are already more than 100 measures in ballot initiatives for transportation funding in the works.
The two-year budget agreement passed earlier this year agreed to increase infrastructure spending by $5.2 billion for “infrastructure” each year for two years. Under the FY18 Omnibus Appropriations Bill, total federal infrastructure spending is up $7 billion in the asphalt pavement market, a 15 percen tincrease.
But 2020 is just around the corner. ARTBA Executive Vice President of Advocacy David Baurer warned that if we do not find anything to take place of two-year budget agreement, the Highway Trust Fund (HTF) crisis will return.
To maintain the current highway spending levels beyond 2020, Congress will have to find an additional $93 billion to write a five-year bill and $115 billion for a six-year surface transportation bill.
Representative Bill Shuster, who is also chairman of the Transportation & Infrastructure Committee, released an infrastructure plan that would generate $284 billion over a 10-year period.
To do this, he proposed a 15-cent gas tax increase, an electric vehicle battery tax, a 4.3-cent tax on commuter trains, a bicycle tire tax and a vehicle miles traveled pilot program.
“The Shuster proposal supports growth and gets the Highway Trust Fund out of an immediate insolvency crisis,” Bauer said. “He realizes that raising the gas tax is not a sustainable solution, but it’s a state. The goal would be to find a long-term solution to the Highway Trust Fund and once we figure out funding, that can happen very quickly.”