July 13, 2021 4:00 PM, EDT

Federal Infrastructure Agreement Could Boost Construction, Experts Say


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State lawmakers have been active in pursuing bills to support infrastructure work, but the construction market could see a further boost if federal leaders can agree on a legislative package, according to transportation experts.

American Road and Transportation Builders Association chief economist Alison Premo Black said the annual value of highway construction put in place in 2020 was $77.1 billion, marking an increase from the $71.1 billion recorded in 2019. The annual value of bridge construction in 2020 was smaller, totaling $22 billion, which marks a decrease from the $26.5 billion logged in 2019.

Black, addressing the Transportation Investment Advocacy Center’s National Workshop for State and Local Transportation Advocates on July 13, said her expectation for 2021 is that activity might “be down a little bit,” but noted that projection takes into consideration a record level of work last year. She said the broader market is fundamentally stronger than it was during the Great Recession.

TIAC is a division of ARTBA.

The event was held as negotiations continue between legislators over a federal infrastructure package. Black said that substantial federal investment can have an impact on the construction market.

“We’re hopeful that action will occur on this over the next few weeks, the next few months,” Black said. “This is really important for the market. When there’s a very real increase in federal investment, this often drives very significant market growth. A robust federal increase in investment would really help drive the market over the next few years and will bring a lot of the state spending aspect with it.”

For their part, state legislators stayed busy passing transportation-related bills in 2020 — a trend that has maintained some momentum in 2021.

According to Carolyn Kramer Simons, senior director of state funding policy at ARTBA, voters approved 94% of state and local ballot measures in 2020, representing $14.1 billion in revenue. This approval rate reflects 303 bills finalized out of 322.

So far in 2021, more than 190 transportation funding measures have been introduced in 44 states. Idaho leaders approved an increase in the transfer of state sales tax proceeds from the general fund to the transportation fund.

On July 13, Missouri Gov. Mike Parson signed a law to gradually increase the fuel tax. Colorado legislators approved a whopping $5.4 billion package that included hikes to the fuel tax rate and the electric vehicle fee.

Simons said the legislative activity in Missouri and Colorado represents multiyear campaigns, rather than reactionary responses to funding challenges presented by the COVID-19 pandemic.

“I think that this has really just been a continuation of campaigns that have been going on and working to address transportation funding shortfalls that have already existed,” Simons said.

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