Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations (2022) / Chapter Skim
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25 C H A P T E R 3 This chapter reviews how the disposition of federal transportation funding introduces uncertainty across the functions transportation agencies perform in the long and short term. The chapter also identifies the functional areas of transportation agencies affected by funding uncertainty, and concludes with findings on the broader impacts of federal transportation funding uncertainty on the economy.
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26 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations period and, as Figure 3-1 shows, funding authorizations are expected to increase from year to year. As the end of a 5-year authorization cycle approaches, several questions arise: • How long will it be until the next authorization act is in place?
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 27 meeting the requirements of the agency's different funding programs. State and local transportation agencies receive federal reimbursements by program, with the funds for several agencies arriving in their accounts anywhere from 1 to 3 months after submitting.
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28 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations into their programs to accelerate project implementation, or they may be forced to adapt their programs to focus on those improvements that can be built within the required time frame. 3.2 Functional Areas Affected by Federal Funding Uncertainty Through the case study interviews, this research assessed how different types of federal funding uncertainty affect state DOTs and regional agencies,1 focusing on four key functional areas (shown in Figure 3-3)
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 29 Highway Trust Fund is low on funds, or appropriations may be delayed such that only 3–6 months of funding is available at a time) , financial management strategies are required to cover cash flow needs and allow agencies to pay their bills on time and initiate projects on schedule.
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30 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations developed before the most recent transportation bills were proposed by the Biden administration. The results are illustrative of the impacts of federal funding uncertainty, rather than a prediction of currently anticipated impact.
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 31 and congestion costs and decreases agglomeration productivity benefits. Transportation costs for households in this scenario will increase by $1.6 billion per year by 2040 along with other costs due to congestion.
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32 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations This analysis shows that project sponsors -- states, local governments, and public transportation providers -- need medium- to long-term (10 to 20 years) federal funding certainty to complete projects and programs to realize their intended economic effects.
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 33 which at times is outpaced by project cost inflation. Additionally, uncertainty in the amount of funding received during the August redistribution and other programs can create work for SDDOT field office staff and contractors as they try to deliver unanticipated funds before the sunset dates.
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34 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations 2. Uncertainty in the timing of federal funds has minimal impact on the functioning of VDOT's programs because of management strategies in use over the last several years, but it can increase VDOT's costs.
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 35 allowed some major capital projects to proceed with reduced dependence on federal aid. The use of the SMART SCALE program (System for the Management and Allocation of Resources for Transportation; based on key factors: safety, congestion reduction, accessibility, land use, economic development, and the environment)
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36 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations 3.4.4 Washington State Case Study Washington has a relatively low share of federal funding, maintains and operates a diverse set of transportation assets, and has a relatively low level of state road ownership per capita and a relatively robust construction program. Based on the interviews, the research team identified the following key findings: 1.
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Federal Transportation Funding Uncertainty and Its Areas of Impact on Transportation Agencies and the Economy 37 2. NCTCOG benefits from its close relationships with the DOT and local agencies and governments.
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38 Federal Funding Uncertainty in State, Local, and Regional Departments of Transportation: Impacts, Responses, and Adaptations conversion of the Transportation Enhancements Program from a formula program to a competitive grant program called TAP -- Transportation Alternatives Program)
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