65% of U.S. roads need repair, White House says

Tuesday, July 15, 2014

WASHINGTON -- About two-thirds of U.S. roadways are in need of repair, and the poor condition of the nation's transportation network results in billions of dollars in extra costs, according to a White House report.

The report was released Monday in conjunction with President Barack Obama's campaign to pressure Congress for a deal to replenish the Highway Trust Fund. The fund, supplied by fuel taxes, is heading toward insolvency as early as next month, jeopardizing jobs and projects during the peak construction season.

Crumbling roads and bridges cut into economic growth by increasing transportation costs and delaying shipments, according to the report.

"A well-performing transportation network keeps jobs in America, allows businesses to expand, and lowers prices on household goods to American families," states the 27-page report by the Council of Economic Advisers and National Economic Council.

New York, New Jersey and Connecticut are among the states with the most roads rated in poor condition, according to the White House.

Twenty-three percent of New York's 114,592 miles of roadway are listed in poor condition and 35 percent of New Jersey's 39,213 miles of public roads are rated that way, according to the White House report. In Connecticut, 41 percent of 21,414 miles of public roads are rated as poor.

Other states with high proportions of poor roads include Delaware, Rhode Island, Maryland, Michigan, Wisconsin, California and Washington.

Obama is scheduled to speak today at a highway research center in McLean, Va., that tests technology to make road and bridge building more efficient. Later in the week, the president will travel to Delaware to announce a new plan to increase private sector investment in transportation projects, the White House said in a statement.

States should expect the federal government to begin slowing payments as early as Aug. 1 to help stretch out funding for road, bridge and transit projects, Transportation Secretary Anthony Foxx has said. Construction delays threaten 112,000 transportation projects and about 700,000 construction jobs, Vice President Joe Biden told business leaders at the White House last week.

"The moment is dire," Foxx said. The trust fund "is quickly running toward insolvency."

The current transportation funding law expires Sept. 30.

The House and Senate are preparing legislation to shore up transportation funding on a short-term basis through May 2015, and lawmakers said votes may come as soon as today.

The House and Senate proposals both generate almost $11 billion, according to Congress' Joint Committee on Taxation. They include increased customs fees, changes to pensions that lower companies' short-term contributions, and revenue from the Leaking Underground Storage Tank Trust Fund. The version in the Democrat-led Senate, though, contains other tax provisions that may be obstacles in the Republican-controlled House.

Lawmakers haven't acted on Obama's proposed four-year, $302 billion plan, in which about half the funding would come from an increase in the federal excise tax on motor fuels and the rest from revenue obtained by closing tax breaks for corporations, including taxing overseas earnings.

Republican and Democratic governors meeting in Nashville, Tenn., over the weekend said lawmakers, at a minimum, should approve a short-term fix before the federal highway account runs dry. They also called for a long-term resolution to prevent uncertainty that could stop or delay projects worth an estimated $3.6 trillion to fix crumbling roads and bridges.

Companies such as Caterpillar, United Parcel Service and Honeywell International are pushing for a long-term solution to infrastructure funding.

The White House economic study on transportation and infrastructure said U.S. investment in roads compared with overseas competitors has fallen to 18th from seventh in the past decade.

White House economists said 65 percent of U.S. roads are rated in less than good condition, and one in four U.S. bridges "require significant repair or cannot handle today's traffic."

The federal government accounted for 27 percent of highway and transit spending in fiscal 2011, compared with 38 percent from states and 35 percent from local sources, according to the Pew Charitable Trusts in Washington.

Information for this article was contributed by Mark Niquette and James Rowley of Bloomberg News.

A Section on 07/15/2014