RALEIGH, NC (AP) – The North Carolina government would need billions of dollars in additional road construction funds if it is to complete the projects currently planned for the next decade, according to recent cost reassessments.
The gap between the costs of the Ministry of Transportation’s committed projects and the funding available from 2024 to 2033 is at least $ 7 billion, WRAL-TV reported.
The highway projects could be taken out of the state’s transportation improvement program – North Carolina’s construction roadmap – or simply not be added.
“It’s a problem,” Joey Hopkins, DOT’s deputy chief planning engineer, told the station.
Project cost increases were accounted for during a routine re-estimate during the COVID-19 pandemic, which contributed to rising material costs and uncertainty in labor markets. Real estate prices have also increased, causing the costs of purchasing real estate to build or widen roads to rise.
“What we’re facing in our market right now… the cost increases we are facing right now are unprecedented,” Hopkins said. “The housing market, our control costs, sometimes seem to be increasing on a daily basis. “
With a current DOT cash balance of $ 2 billion, the department’s 12- and 36-month leases are not expected to be affected, Hopkins said. In the long term, the DOT says it is talking to local leaders statewide about scaling projects without cutting them off.
Almost all of DOT’s annual income comes from state and federal gasoline taxes, a 3% vehicle sales tax, and motor vehicle division fees. Longer-lived vehicles and those with higher gas mileage are affecting highway revenues nationwide, reducing gasoline and vehicle sales tax revenues.
Cumulative funding available for 2024-2033 is currently estimated at $ 23.5 billion, according to a DOT presentation.
A Blue Ribbon commission recommended in January that North Carolina increase its transportation spending by 40% to improve highways, railways and public transportation. The panel said the state needs to locate at least $ 2 billion more per year to get there.
Approving more taxes and transportation costs would be politically sensitive for the Republican-controlled General Assembly and Governor Roy Cooper, a Democrat.
The overruns are a “symptom of the problem of the obsolescence of our revenue streams,” said Senator Mike Woodard, a Democrat from County Durham. “This clearly shows that we need to modernize DOT revenues, and it’s going to be a big job, but it’s high time to roll up our sleeves.”
The state Transportation Council is unlikely to approve the state’s next transportation improvement program until the summer of 2023, Hopkins said. Some costs could go down by then.
“I just want to reiterate: we have time to fix this problem,” Hopkins said.