WASHINGTON -- U.S. Transportation Secretary Anthony Foxx on Wednesday praised Arkansas' decision to stop reviewing $355 million in bids for highway construction projects in the state while Congress works on a long-term plan to fund roads.
"I have to say to the leadership of Arkansas that their willingness to say exactly how this uncertainty is affecting them is laudable in a way, because that's a hard thing to do," he said.
Once routinely approved, Congress hasn't been able to agree since 2005 on extending long-term funding authority through the Highway Trust Fund for surface transportation projects. Instead, it has passed a series of short-term fixes -- typically three- to six-month funding measures.
The most recent stopgap, passed in May, expires July 31. If Congress doesn't act by then, the U.S. Transportation Department says it won't have authority to reimburse states for highway repairs or to start new construction projects. The House voted 312-119 Wednesday to approve another stopgap measure, this one lasting until Dec. 18.
The Arkansas Highway and Transportation Department has put on hold $335 million in projects this road construction season, citing uncertainty about federal funding and reimbursements. Most recently, bids were halted for a new overpass on a south Little Rock artery. Work on a new interchange for a planned Conway bypass also was delayed.
In an interview at his department's Washington headquarters, Foxx said it is "tragic" that Arkansas road projects are being delayed. He said many states are covering up the full effects of the funding uncertainty to keep from angering people.
"I don't think there's a state in the country that isn't being impacted by the long series of short-term measures and the uncertainty that still exists out there, but I have to give Arkansas credit for having the guts to say what the impacts are, and I want more states to do that," he said.
The funding problems affect the entire nation, he said.
"It's not a matter of there being no impacts, it's just a matter of the states being clear and vocal about what those impacts are," he said.
Foxx said that as the public learns that states are delaying or slowing down road repairs and construction because Congress can't agree on a solution, they will get angry. If voters are unhappy and speak out, lawmakers have a greater incentive to find a long-term plan, he said.
Money for the highway fund mostly comes from a federal gasoline tax, set at 18.4 cents per gallon since 1993. With vehicles becoming more fuel-efficient, revenue from the tax has declined at the same time that more road repairs have been needed. The main disagreement in Congress has been over how to replenish the fund.
Foxx said only six states so far have announced that they are pulling back from a combined $6 billion in projects because of the federal funding uncertainty, and more are quietly building financial cushions in case the federal government can't reimburse them for projects.
"The states have become more risk-averse over time," he said. "It's time for Congress to get a long-term bill done."
State Highway Commission Chairman Dick Trammel said Arkansans would have noticed if the state Highway Department hadn't been forthright about halting projects. For example, it halted a $50 million contract for filling potholes and cracks, and then laying fresh asphalt over roads in rural areas, he said.
"We're going to see a lot more potholes and a lot more damage to our highways particularly with the winter we had," Trammel said. "But we have to be financially smart."
Trammel praised the state Highway and Transportation Department for having the foresight to pull the projects from consideration before they were started.
"They have been leaders in the country for predicting what could happen," Trammel said. "I know other states that have had big financial problems the last five or six years."
Department spokesman Danny Straessle said Arkansas is reimbursed for 80 percent of the cost of federal highway projects, and that 70 percent of Arkansas road construction depends on federal reimbursement. He said the effects of that money not coming into the state is larger than most people realize.
"The 75 projects, the $335 million that that represents, is the tip of the iceberg as it relates to the Arkansas economy and [the] impact that inaction by Congress has caused," he said. He said not using the money also means workers on road projects aren't eating at restaurants or staying in hotels near job sites, or that hardware stores aren't selling equipment.
"You can see how that trickle down makes an impact," he said.
Straessle said the state Highway Department wants a long-term solution before the remaining three bid lettings take place this year in September, October and December, and more projects are potentially put on hold.
"Our hope is that Congress will find a six- to eight- to 10-year solution by the end of this month, but the trust fund needs to be fixed, resolved, and they've had plenty of time to work on it," he said. "We can't plan for the future if we don't know that the money is going to be there."
Arkansas' all-Republican delegation in the House voted for the extension Wednesday. They each released statements afterward saying that a long-term fix is still necessary and preferable. The White House said in a letter Wednesday that it supports the extension because it gives Congress another five months to work out a long-term deal.
The Senate has been working on a six-year $275 billion funding measure but hasn't said how it will be paid for.
Foxx said President Barack Obama's administration wants a six-year, $478 billion surface transportation funding plan approved by the end of the year. The administration has proposed funding it through a process known as "repatriation," which would tax corporate profits being held overseas at a 14 percent rate.
Trammel said even if it is approved by the Senate and Obama, the short-term deal won't change anything in regard to the delayed Arkansas construction.
"If we had assurances of the trust fund, we would have let those projects like normal," he said. "With this short-term thing, we will have to continue to pull projects."
Arkansas Highway Commissioner Tom Schueck of Little Rock said another short-term fix does little to help Arkansas roads.
"You have to plan highways long in advance, and the short-term fixes have taken away all of our ability to take part in long-term planning," he said.
Schueck said any responsible state should be protecting itself in case the federal government can't reimburse it for highway construction.
"It's forward thinking to be prepared for what we call a doomsday scenario," he said. "What we want is for Congress to step up and do their duty. Our Congress is just avoiding their responsibility. They've got to come up with a fix, and it should be a long-term six- or seven-year fix."