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State's roads could take another hit with reduced federal funding forecast

Date Posted: August 3 2007

Washington, D.C. - Back in February, the Bush Administration released a budget forecast for fiscal year 2009, which included a relatively mild $700 million reduction in Highway Trust Fund spending compared to the previous year.

On July 11, the administration released an update to that forecast, and the outlook for road construction spending grew worse. Much worse.

"America's transportation system is the heart of our country's economy and to neglect it is a disservice to our nation," said Stephen Sandherr, CEO of the Associated General Contractors of America. "The cuts in FY 2009 from the promised level of $43.4 billion to about $27 billion, would result in a 37 percent reduction in spending on our nation's infrastructure. Neglecting our transportation infrastructure will only make it more difficult for America to compete in the world market."

Michigan is slated to spend $1.62 billion on highway work in 2007, but that amount is projected to decline to $1.2 billion in each of the years 2009, 2010 and 2011, according to Michigan Department of Transportation Director Kirk Steudle. Those future amounts don't include the future federal cuts in highway spending. Steudle said state spending on roads is one-third from federal money and two-thirds generated from the state.

Sandherr continued, "This budget news comes at a critical juncture for the highway program, and federal, state and local governments will all feel the pinch. AGC has been working with our allies in the State DOTs on solutions to fix the problem, which we have presented to both the administration and Congress."