State “redirects” highway money to pay for emergency repairs

Secretary of Transportation Brian Searles speaking before members of the Vermont House and Senate on Wednesday. VTD/Josh Larkin

Secretary of Transportation Brian Searles speaking before members of the Vermont House and Senate on Wednesday. VTD/Josh Larkin

Last week Gov. Peter Shumlin told reporters that Vermont’s transportation budget is at the mercy of Congress, and given the latest information about funding for emergency relief from the U.S. Department of Transportation, it appears that the state will be in a wait-and-see mode for some time to come.

Tropical Storm Irene caused $500 million in damage to the state highway system, and repairing town highways could cost at least several hundred million dollars more, officials say.

Federal money for repairs could be delayed, according to state officials, and just how much funding would be made available is anyone’s guess.

At the moment, funding from the Federal Highway Administration program isn’t forthcoming, thanks to the ongoing crisis of governance in Congress. Instead of enacting a federal budget bill in a timely fashion for an entire fiscal year, gridlock between House Republicans and Senate Democrats has led to passage of “continuing resolutions” or stopgap appropriations for short periods of time. The last “CR” passed at the end of September. The federal government runs out of money again on Nov. 18.

Even if the emergency relief funding is made available in the coming months, it could be some time before Vermont’s costs for reconstruction are reimbursed. That’s because the federal government is already $1 billion behind in payments for transportation infrastructure destroyed by natural disasters around the nation – before Northeastern states incurred an additional $1 billion in damage as a result of Irene.

Lenny LeBlanc, director of finance and administration for the Vermont Agency of Transportation, explained at a meeting of the House and Senate transportation committees on Wednesday that “Congress needs to fill the backlog and pay that obligation (the $1 billion in pre-Irene repairs) before Vermont can continue to receive emergency relief funds.”

LeBlanc prefaced his remarks to lawmakers on Wednesday with a caveat that was greeted with tittering laughter from lawmakers: “You’re probably wondering how much it will cost and how we’ll pay for it. You’re probably wondering if I’m going to answer those questions. Well, I’m not.”

LeBlanc said the state will attempt to minimize the budget impact of the necessary ongoing repairs that must be completed before winter. The state will be “redirecting” money from the federal highway “formula” funds for planned projects to pay for emergency reconstruction. Once the emergency relief funds are sent to the state, the formula funds would be replenished. The result of the funding shift could be that some of the state’s long scheduled projects, such as the Route 7 Bypass, may be delayed next year.  Projects under construction right now, however, have not been delayed, LeBlanc said.

So far, the state has received $5 million in emergency relief funds from the U.S. Department of Transportation. The state has paid $22 million for emergency repair work that has been completed, according to LeBlanc, though he said there is a backlog of invoices that are currently under review and he didn’t know how much the state owes in additional payments. The money will come from $37 million in fiscal year 2011 federal formula funds slated for other projects. If the next CR is approved in November, the state would receive $25 million in formula funding for planned state projects that could be used to temporarily defray the costs of emergency repairs, LeBlanc said.

VTrans will not be able to provide specific budget details to lawmakers until December, when the House and Senate appropriations committees convene to discuss the Budget Adjustment Act. LeBlanc said he expects the state fund figure for the budget adjustment will be between $10 million and $12 million.

If Congress continues to delay funding for emergency relief to Vermont, the state could face a cash-flow problem, LeBlanc said. The longer the state has to wait for the money, the more difficult it will be for the state to “deliver the transportation program you passed last session.”

LeBlanc told lawmakers that the state needs to urge Congress “to act promptly” to lift the $100 million cap on emergency relief funding for the first six months after the disaster and to address the $1 billion backlog of emergency relief for disasters prior to Irene.

Last month, Sen. Patrick Leahy, D-Vt., requested $1.9 billion in additional emergency assistance funding for the Federal Highway Assistance program in an amendment to a Senate Appropriations bill. The provision also waives the 80/20 percent cost-sharing match.

Anne Galloway

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