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$7 Billion in Federal Highway Funds Obligated in FY 2013 So Far

Federal, state and local transportation departments of transportation (DOTs) have so far obligated $7 billion in federal funds during Fiscal Year 2013, which began last Oct. 1, according to the latest analysis of Federal Highway Administration (FHWA) data by the American Road & Transportation Builders Association (ARTBA). This is an increase of 56 percent over the $4.5 billion obligated during the same time period last year.

“The current obligations levels are much more in line with what we expect to see in the marketplace,” said ARTBA Chief Economist Dr. Alison Premo Black. “The passage of MAP-21 has provided some stability – obligation levels were quite low in FY 2012 and FY 2011 as state transportation departments were dealing with a series of continuing resolutions for the federal aid program.”

ARTBA’s monthly report, “Obligation of Federal Highway Funds,” finds that the $2.3 billion obligated in January was 13 percent higher than the amount obligated during January 2012 ($2 billion), but 3.9 percent less than during January 2010 ($2.4 billion) when state DOTs were rushing to obligate the last of their American Recovery & Reinvestment Act funds.

Although obligations are off to a good start, there are still some unknowns ahead, Black says. Legislation to fund the federal government must be enacted before the end of March if states are to receive more than the $16.9 billion of highway funds that are required to be obligated before the end of the fiscal year.

The obligation of federal funds is a leading indicator of state level market activity. When a state or local DOT has an eligible project ready to go under the federal-aid highway program, it enters into an agreement with FHWA that obligates the federal government to pay its share of the costs. The project can then proceed to bidding and construction.