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Transportation News August 8, 2008

KYTC to Use Practical Solutions to “Do More with Less”
Gov. Steve Beshear and KYTC rolled out a plan this week to maximize the value of Road Fund expenditures in the face of a severely constrained budget, escalating costs for materials, and a cloudy outlook for future federal funding. “We will do more with less,” said Beshear. The program comes as the cabinet faces the reality of a six-year road plan that includes projects with an estimated cost of more than $8 billion and estimated revenues of $5.3 billion with no real assurance of how much federal money will be available. Federal funds account for nearly three-quarters of the revenue estimate. On the state funding side, revenues from highway user fees are seriously eroded by diversion to other programs.

Highway Veto Case Continues as Judge Rules Legislative Plan Invalid
Franklin Circuit Judge Phillip Shepherd has ruled HB 79, the General Assembly's version of a highway construction plan, is “null and void” because it was not delivered to the governor on April 15, the day the General Assembly is required by the Kentucky Constitution (Section 42) to adjourn. The ruling came in a suit filed by Senate President David Williams challenging Gov. Steve Beshear’s veto of the bill and the ability of the administration to conduct a construction program without a legislatively approved plan. Regardless of the outcome in the Circuit Court, the case is expected to be heard by the Kentucky Supreme Court.

Materials Costs Climb 19% from 2007
Increased material costs continue to squeeze transportation budgets, causing real reductions in the actual amount of construction work put in place. A major spike in diesel fuel, steel, and asphalt were the driving forces behind a 19 percent jump in highway and street construction materials in June compared to the same month in 2007.

Transportation News July 30, 2008

Focus on Senate as House Approves Highway Fix
The House, by a vote of 387 to 37, agreed last week to deposit $8.017 billion from the government's General Fund into the Highway Account of the Highway Trust Fund to cover a projected $3.3 billion shortfall next fiscal year. Supporters note the transfer simply restores money taken out of the Highway Trust Fund in a 1998 budget deal. All members of the Kentucky Delegation voted for H.R. 6532. Congressmen Ben Chandler and John Yarmuth were cosponsors. The objective now is to get a clean bill, H.R. 6532, on the Senate agenda when the Senate returns in September from the August recess. Kentucky has some $200 million and an estimated 5,600 jobs at stake in the legislation.

Replacing Nation’s Deficient Bridges Could Cost $140 Billion
Making all of the needed repairs or upgrades to the nation’s deficient bridges could cost $140 billion, according to a report released this week by the American Association of State Highway and Transportation Officials. SAFETEA-LU would provide $5.4 billion for the bridge program in FY 09. One bridge in four needs to be modernized or repaired. Some 31.5 percent of Kentucky’s bridges are structurally deficient or functionally obsolete, according to FHWA. KYTC is working continuously to ensure the safety of the state’s nearly 14,000 bridges, but the increasing age of the bridges and the lack of funds to repair or replace them, or to build new ones to relieve congestion problems, remains a primary concern.

Agencies Sue State for Diverting Fee Revenue
A group led by the Catholic Conference of Kentucky has filed suit challenging the General Assembly's practice of transferring funds from the state Department of Charitable Gaming to help shore up the General Fund budget. The lawsuit would stop the practice of taking revenue the department raises through license fees on nonprofit groups. The suit raises the broader question of whether the legislature can legally take millions of dollars from boards and commissions that license and regulate various activities in state. The current budget transfers a total of $481.5 million from various designated accounts to the General Fund budget. The transfers include a new record, $117.6 million in funds directly contributed by highway users.

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