By Mike Barton
Commissioner, Department of Transportation and Public Facilities
January 20, 2006
Legislators were anxious to know how the STIP is impacted by this administration's decision to go forward on the two bridge projects in Anchorage and Ketchikan. They learned that the bridge earmarks represent only a small portion of a much larger problem that has reduced funding for STIP projects.
While the total number of federal dollars coming into Alaska's transportation program has grown under the most recent congressional highway authorization bill, fewer dollars are able to actually make it into major highway projects, for several reasons. These factors can be categorized as "increased eligibility" and "restricted funds."
Before 1991, only about 30 percent of Alaska's roads were eligible for STIP dollars, as is the case nationwide. These are the major highways, arterials, or collector routes. This is where 75 percent of the traffic is carried, where 85 percent of the major accidents happen, and where an even higher percentage of freight is hauled. But in 1991, 100 percent of our public roads became eligible for STIP dollars. This allowed the use of federal dollars for local road construction.
Alaska sends more than 40 percent of its STIP dollars to the local level, including the metropolitan planning organizations in Anchorage and Fairbanks, under a formula in state regulation. Yet, nationwide, other states send less than 20 percent of their STIP dollars to local communities.
Earmarks have further affected the STIP, by funding many non-highway projects, such as ports, parking lots, local streets, and shipyards. While these are worthy and needed projects, they dilute the funds available for highways.
Over the past two decades, the Legislature has shifted activities to federal funding that were previously paid from the general fund. These include such major maintenance and operating costs as striping, guardrail rehabilitation, etc. This is now taking about $60 million per year that would otherwise be available for the STIP.
At the same time eligibility for dollars has gone up, the actual dollars available have gone down. For example, while the bridge earmarks have received all the attention, other earmarks total more than $585 million over the next five years.
Several new federal funding categories - about $25 million annually - have become more restrictive. For example, many states have hundreds of bridges in disrepair. Congress responded to this crisis by increasing bridge repair funds. Alaska's existing bridges are in pretty good shape, but we can't use these funds to build new bridges, or on regular highway projects.
The federal Highway Trust Fund (where your gas taxes go) is not delivering 100 percent of what Congress authorizes. DOT factors this in at 85 percent, based on what our experience has been over the past few years.
Nationwide, inflation across the board in construction materials, services, and labor has increased the cost of projects by about 30 percent over the past year. Everything we use is going up - steel, concrete, asphalt, energy, our contractors' insurance, etc. This means that where we had ten projects on the STIP, and the price just went up by 30 percent, now we can do only seven projects.
Hidden costs of legal challenges, process, and complying with new regulatory requirements further erode funds available for actual construction.
These and other impacts on the STIP add up to about $263 million that cannot be used to build ordinary projects on our highway system each year.
The question remains - If available STIP funding is down, why are we continuing to push for the bridge projects in Anchorage and Ketchikan?
We do so simply because the bridges represent major engines for the economies of those areas, as well as the state as a whole. They will connect communities and will provide new areas for both Anchorage and Ketchikan to grow. They are "bridges to the future."
About: Mike Barton is the Commissioner of the Alaska Department of Transportation and Public Facilities.
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