Budget cut hits WisDOT materials estimate

Even as a cut in state borrowing leads transportation officials to push back the completion dates of various highway projects, road contractors are seeing an even more direct sign that they will be getting less work in the coming year.

In keeping with past practice, the Wisconsin Department of Transportation has released a “snapshot” showing projections of the amounts of materials and types of work that will be needed on state road projects in the current fiscal year. The figures for fiscal year 2016, which started on July 1, are in many cases far below what they were in the previous year’s estimates.

WisDOT, for instance, predicts that state road projects will require the use of nearly 1.8 million tons of asphalt and 2.03 million square yards of concrete in the state’s 2016 fiscal year. Those numbers are down from the 2.53 million tons of asphalt and 2.25 million square yards of concrete that were estimated to be needed in the previous year.

VIEW THE STATE’S ROAD PROJECTS PREDEICTIONS

WisDOT is also predicting it will need less of various types of work. The agency, for instance, projected that road projects in fiscal year 2016 will require the excavation of nearly 7.58 million cubic yards, down from 13 million in the previous year. Likewise, WisDOT is predicting a need for 5.53 million square yards of milling in fiscal year 2016, down from 7.8 million in the previous year.

Road contractors have been hearing for months about the likely effects of lawmakers’ decision earlier this year to initially remove $800 million from the nearly $1.3 billion in transportation bonding that Gov. Scott Walker had proposed in the current state budget. WisDOT officials began confirming last week that there will be two-year delays to various projects throughout the state, including a long-planned expansion of Interstate 39/90 from Madison south to the Illinois border and a reconstruction of the Verona Road interchange on Madison’s Beltline highway.

After the large cut to the state’s transportation borrowing, few contractors were likely to be surprised to learn that projects were being pushed back. Still, as prepared for delays as the road-building industry no doubt was by the bonding and other budget figures, WisDOT’s material and work estimates are seen by many as even more significant, said Kevin Traas, director of transportation policy and finance at the Wisconsin Transportation Builders Association.

“Quantities are the best indicator of the volume of work available in a particular market,” Traas said, “and provide contractors a gauge they can use in planning for their future operations, equipment purchases, hiring and other business decisions.”

Meanwhile, there is at least one reason to believe that WisDOT’s needs for the current fiscal year might turn out greater than they appeared in the initial estimate. When lawmakers reduced the governor’s borrowing request to $500 million, they set aside an additional $350 million worth of bonding that can be divvied up among individual projects at a later date.

WisDOT officials have yet to make a request for the use of the supplementary bonding. Putting it toward specific projects will first require getting the consent of lawmakers on the state’s Joint Finance Committee, several of whom are known to still be reluctant to saddle the state with more debt.

But a push for making use of the additional $350 million in bonding came from a high place Thursday. Speaking to reporters during a swing through the Fox Valley – where several road projects are being delayed because of budget cuts – the governor said he would like to see the Joint Finance Committee meet within the next month to consider how the money should be divvied up.

Walker rebuffed state Democrats’ call for a special legislative session to find ways to bring in more revenue for transportation. The money needed for most of the important projects throughout the state, he said, is already in the budget and is only awaiting lawmakers’ approval.

“My hope is within the next month that they’ll meet, and they’ll find a way to release those funds going forward,” Walker said in remarks posted online by the Wisconsin Radio Network, “so we can go forward with these projects in the Fox Valley and other key projects across the state.”

Despite Democrats’ call for a special session, any discussion of bringing in more revenue for transportation projects is not likely to occur until 2017 at the earliest, when lawmakers debate the next budget. And although some lawmakers are no doubt eager to wean the state off debt, the alternative prospects of raising the state’s gas tax or vehicle-registration fees will remain tough sells.

Walker himself has said on many occasions that he cannot support a revenue increase that is not offset by a comparable decrease elsewhere in the budget. Terry McGowan, president of the International Union of Operating Engineers Local 139, said he traveled to Madison this week to gauge lawmakers’ interest in a possible return to the indexing system that had caused the state’s gas tax to automatically rise with inflation from year to year.

Lawmakers abolished indexing in 2006, leaving the gas tax at its current level of 30.9 cents a gallon (with an additional 2 cents tacked on to pay for the cleanup of leaking underground-storage tanks). McGowan said his lobbying for the system, which many people liked because it helped keep politics out of revenue decisions, has so far been to little avail.

“I wonder how some of these legislators are going to answer to the constituents,” with many of the state’s roads start to show serious signs of decay, he said. “This whole thing will speak for itself.” Follow @TDR_WLJDan