Transportation funding is still slogging through Congress like a turtle through quicksand, and it looks as if another extension is going to be the temporary law of the land.
Meanwhile, Congress just adopted a budget resolution that calls for spending 22 percent less on transportation funding. As NSSGA so aptly noted, “Cutting federal support from surface transportation projects would have a devastating impact on road conditions, jobs and the economy at a time when our economy needs infrastructure improvements the most.”
Fortunately, the measure is a non-binding budget resolution. It’s an opening bid when it comes to federal spending and our senators and representatives are not bound by it. But really, what are they thinking?
Given the maddening particulars in the nation’s capital, I am prompted to go looking for good news elsewhere.
In Vulcan Materials latest quarterly report, they noted some positives in the industry’s market climate. “Underlying demand remains strong, and we are seeing accelerating momentum in aggregates volumes and pricing throughout our markets,” said Tom Hill, president and CEO. “The growth rate in our trailing 12-month aggregates shipments has increased for seven consecutive quarters and, as expected, that momentum is beginning to benefit aggregates pricing. This momentum underscores our confidence in the full-year expectations we provided in early February of this year. Momentum remains strong in Vulcan-served markets. We are optimistic about the volume growth, pricing momentum and strong margin expansion we see across our markets.”
Over at Martin Marietta Materials, Chairman, President and CEO Ward Nye noted these key market positives:
- Nonresidential construction is expected to increase in both the heavy industrial and commercial sectors. The Dodge Momentum Index remains high and signals continued growth.
- Energy-related economic activity, including follow-on public and private construction activities is anticipated to remain strong.
- Residential construction is expected to continue to grow, driven by historically low levels of construction activity over the previous several years, employment gains, low mortgage rates, significant lot absorption, higher multi-family rental rates and rising housing prices.
- For the public sector, authorized highway funding from MAP-21 should remain stable. State initiatives to finance infrastructure projects are expected to grow.
So instead of focusing on the negative, I am letting the market fundamentals speak for themselves, and I will continue to hope Washington gets it right. Some day.