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TRIP Reports: Ohio Faces Deficient Roads & Bridges, High Rural Fatality Rates, Mounting Congestion And Insufficient Transportation Funds. With Spending Set To Decrease In 2016, State Faces $11.6 Billion Shortfall In Needed Funds For Transportation Improvements.

Ohio’s transportation system faces challenges in the form of deteriorated roads and bridges, high rates of rural traffic fatalities, increasingly crowded roads, and insufficient funding to proceed with projects needed to support economic development. Increased investment in transportation improvements at the local, state and federal levels could improve road and bridge conditions, boost safety, increase roadway efficiency and support long-term economic growth in Ohio, according to a new report released today by TRIP, a Washington, DC based national transportation organization.

The TRIP report, Modernizing Ohio’s Transportation System: Progress and Challenges in Providing a Safe, Efficient and Well-Maintained Transportation System,” finds that while the Ohio Department of Transportation (ODOT) has been able to boost annual spending on highways and bridges over the last four years, funding is set to decrease significantly in 2016 and 2017 and the state faces an $11.6 billion shortfall in funding for needed road, highway and bridge improvements. According to the TRIP report, nearly one-quarter of major urban roads are in poor condition, while approximately a quarter of locally and state-maintained bridges are structurally deficient or functionally obsolete. The state’s major urban roads are becoming increasingly congested and the fatality rate on Ohio’s rural roads is disproportionately high.

Twenty-four percent of Ohio’s major locally and state-maintained urban roads are in poor condition, while 41 percent are in mediocre or fair condition and the remaining 35 percent are in good condition. State-maintained roads are generally in better condition, with 98 percent of urban and rural state-maintained roads in acceptable condition.

Ohio’s bridges are also showing signs of their age, with approximately a quarter of locally and state-maintained bridges rated as structurally deficient or functionally obsolete. Eight percent of Ohio’s locally or state-maintained bridges are structurally deficient, meaning they have significant deterioration of the bridge deck, supports or other major components. These bridges are often posted for lower weights or closed to traffic restricting or redirecting large vehicles, including commercial trucks and emergency response vehicles. An additional 16 percent of Ohio’s locally and state-maintained bridges are functionally obsolete. Bridges that are functionally obsolete no longer meet current design standards, often because of narrow lanes, inadequate clearances or poor alignment.

“TRIP’s report once again demonstrates that more must be done to secure funding for our state’s roads and bridges,” said Kimberly Schwind, senior public relations manager for AAA Ohio Auto Club.  “Our leaders in Ohio and Washington must recognize the importance of this issue before it’s too late. Central Ohioans rely on our roads and bridges every day, and putting off tough decisions will only lead to longer commutes, more potholes and unsafe roads.”

Traffic crashes in Ohio claimed the lives of 5,229 people between 2009 and 2013, an average of 1,046 fatalities each year. The state’s overall traffic fatality rate of 0.88 fatalities per 100 million vehicle miles of travel is lower than the national average of 1.09. But, Ohio’s rural non-Interstate roads have significantly higher rates of fatal crashes, with a traffic fatality rate of 1.91 fatalities per 100 million vehicle miles of travel, more than three times the 0.58 fatality rate on all other roads and highways in the state.

Increasing traffic congestion is causing delays and increasing business operating costs. The efficiency and condition of Ohio’s transportation system, particularly its highways, is critical to the health of the state’s economy. Annually, $563 billion in goods are shipped from sites in Ohio and another $493 billion in goods are shipped to sites in Ohio, mostly by truck.

The Federal Highway Administration estimates that each dollar spent on road, highway and bridge improvements results in an average benefit of $5.20 in the form of reduced vehicle maintenance costs, reduced delays, reduced fuel consumption, improved safety, reduced road and bridge maintenance costs and reduced emissions as a result of improved traffic flow.

In addition to state and local funding, the federal government is a critical source of funding for Ohio’s roads, highways and bridges. However, after a series of short-term extensions by Congress, the current federal transportation legislation is set to expire on July 31, 2015. Many needed projects throughout the state will require significant federal funding in order to proceed by 2020. These projects include reconstruction of portions of Interstates 70 and 71 in the Columbus area, the reconfiguration of portions of Interstate 270 in the Columbus area, the widening of a portion of Interstate 80 in the Youngstown area, the widening and reconstruction of a portion of Interstate 77 in Cuyahoga County, the reconstruction of the Main Street/Broadway Street interchange with Interstate 76 in Akron, the construction of the Opportunity Corridor highway in the Cleveland area, the reconstruction and widening of portions of Interstate 75 in the Cincinnati area and the replacement of the Brent Spence Bridge over the Ohio River in Cincinnati. A full list of projects threatened by a lack of adequate federal funding can be found in the report’s Appendix.

“Ohio’s transportation system will become increasingly deteriorated and congested if greater funding is not made available at the local, state and federal levels,” said Will Wilkins, TRIP’s executive director. “Congress can help by approving a long-term federal surface transportation program that provides adequate funding levels, based on a reliable funding source. If not, Ohio is going to see its future federal funding threatened, resulting in fewer road and bridge improvements, loss of jobs, and a burden on the state’s economy.”

MODERNIZING OHIO’S TRANSPORTATION SYSTEM:

Progress and Challenges in Providing a Safe, Efficient and Well-Maintained Transportation System
Executive Summary

            Ohio’s extensive system of roads, highways, bridges and public transit provides the state’s residents, visitors and businesses with a high level of mobility. This transportation system forms the backbone that supports the state’s economy and quality of life for all Ohioans.

As Ohio looks to retain its businesses, maintain its level of economic competitiveness and achieve further economic growth, the state will need to continue to maintain and modernize its roads, highways and bridges by improving the physical condition of its transportation network and enhancing the system’s ability to provide efficient, safe and reliable mobility for motorists and businesses. Making needed improvements to Ohio’s transportation system could also provide a boost to the state’s economy by creating jobs in the short term and stimulating long term economic growth as a result of enhanced mobility and access.

Located within a day’s drive of 60 percent of the population of the United States and Canada, Ohio must continue to improve its transportation system to foster economic growth and keep and attract businesses. In addition to economic growth, transportation improvements are needed to ensure safe, reliable mobility. Meeting Ohio’s need to further modernize and maintain its transportation system of roads, highways, bridges and public transit will require significant local, state and federal funding.

In the face of stagnant transportation revenue growth, Ohio has been able to increase its construction investment in the state’s roads, highways and bridges from $1.6 billion in 2011 to $2.4 billion in 2014 and 2015. This was achieved by reducing operating costs through staff attrition and streamlining, modernizing budgeting practices, allowing greater flexibility to modify projects, improving the efficiency of project design and delivery, and the 2013 approval of the use of Ohio Turnpike bonds on transportation projects.

But the recently adopted state transportation budget reduces annual state highway and bridge construction spending to $1.9 billion in 2016 (contingent on the sale of Turnpike toll-backed bonds) and to $1.7 billion in 2017.

Increases in state transportation investment have kept Ohio’s state-maintained roads, highways and bridges largely in acceptable or good condition and have allowed numerous, needed road, highway and bridge projects to proceed. Despite this, the state faces an $11.6 billion backlog in needed but unfunded road, highway and bridge improvements.

Ohio also faces the following transportation challenges: improving the condition of locally-maintained roads, highways and bridges; maintaining the condition of state-maintained roads, highways and bridges; improving roadway safety; relieving traffic congestion; and, providing additional highway access to support economic growth. The state’s ability to address these challenges could be jeopardized by uncertainty in the future levels of federal transportation funding.

Achieving Ohio’s goals for a modern, well-maintained and safe transportation system will require significant transportation investment at the local, state and federal level.

TRIP OH 1Despite the lack of recent increases in state or federal transportation revenues, the Ohio Department of Transportation (ODOT) has been able to boost annual spending on roads, highways and bridges over the last four years through operational improvements and the use of bonds backed by the Ohio Turnpike. This increased investment has allowed Ohio to keep state-maintained roads, highways and bridges largely in acceptable condition. However, it has not been adequate to close a shortfall in needed transportation improvements in the state.

  • ODOT has been able to increase its construction investment in the state’s roads, highways and bridges from $1.6 billion in 2011 to $2.4 billion in 2014 and 2015.
  • The recently adopted state transportation budget reduces state highway and bridge construction spending to $1.9 billion in 2016 (contingent on the sale of Turnpike toll-backed bonds) and to $1.7 billion in 2017.
  • ODOT has made available an additional $182.5 million annually for roadway improvements through increased staff efficiency, the adoption of zero based budgeting standards which reduced the need to carry significant cash balances, by allowing greater flexibility to modify projects, and by improving the efficiency of project design and delivery.
  • In 2013 the Ohio General Assembly approved the use of Ohio Turnpike bond proceeds with the provision that 90 percent of the revenue be used on transportation projects within 75 miles of the Turnpike.
  • ODOT has an $11.6 billion backlog in needed road, highway and bridge improvements, which are currently unfunded.
  • Ohio faces a significant challenge in improving the condition of locally-maintained roads, highways and bridges; maintaining the condition of state-maintained roads, highways and bridges; improving roadway safety, particularly on rural roads; relieving traffic congestion; and, providing additional highway access needed to support economic growth.

Population, economic and travel growth have placed increased wear and tear and traffic congestion on Ohio’s major roads and highways.

  • Ohio’s population reached approximately 11.5 million in 2013, a six percent increase since 1990, when the state’s population was approximately 10.8 million. Ohio has approximately eight million licensed drivers.
  • Vehicle miles traveled (VMT) in Ohio increased 30 percent from 1990 to 2013 – from 87 billion VMT in 1990 to 113 billion VMT in 2013.
  • From 1990 to 2013, Ohio’s gross domestic product (GDP), a measure of the state’s economic output, increased by 39 percent, when adjusted for inflation.

Nearly one-quarter of Ohio’s locally and state-maintained urban roads are in poor condition, while four percent of the state’s rural roads are in poor condition.

  • Twenty-four percent of Ohio’s major locally and state-maintained urban roads and highways have pavements in poor condition, while an additional 41 percent are rated in mediocre or fair condition. The remaining 35 percent are rated in good condition.
  • Four percent of Ohio’s major locally and state-maintained rural roads and highways have pavements in poor condition, while an additional 37 percent are rated in mediocre or fair condition and the remaining 59 percent are rated in good condition.
  • Pavements on state-maintained roads are generally in better condition than pavements on locally maintained roads. Pavements on 98 percent of state-maintained roads and highways, including both urban and rural, are in acceptable condition.
  • Roads rated in poor condition may show signs of deterioration, including rutting, cracks and potholes. In some cases, poor roads can be resurfaced, but often are too deteriorated and need more complex and expensive reconstruction.
  • The chart below details the percentage of major locally and state-maintained roads in poor, mediocre, fair and good condition in the state’s major urban areas:

 

TRIP OH 2Approximately a quarter of locally and state-maintained bridges in Ohio show significant deterioration or do not meet current design standards often because of narrow lanes, inadequate clearances or poor alignment. This includes all bridges that are 20 feet or more in length.

  • Eight percent of Ohio’s locally or state-maintained bridges are structurally deficient. A bridge is structurally deficient if there is significant deterioration of the bridge deck, supports or other major components. Structurally deficient bridges are often posted for lower weight or closed to traffic, restricting or redirecting large vehicles, including commercial trucks and emergency services vehicles.
  • Sixteen percent of Ohio’s bridges are functionally obsolete. Bridges that are functionally obsolete no longer meet current highway design standards, often because of narrow lanes, inadequate clearances or poor alignment.
  • Bridges on state-maintained road and highways are generally in better condition than bridges on locally maintained roads and bridges. Ninety-nine percent of state-maintained bridges in Ohio are in acceptable condition. 
  • The chart below details the percentage of bridges in the state’s major urban areas rated either structurally deficient or functionally obsolete:

TRIP OH 3ODOT has committed $130 million from 2014 to 2017 for repairs to deficient bridges.

Improving safety features on the state’s roads and highways would likely result in a decrease in traffic fatalities and serious crashes. It is estimated that roadway features are likely a contributing factor in approximately one-third of all fatal and serious traffic crashes.

  • Between 2009 and 2013, 5,229 people were killed in traffic crashes in Ohio, an average of 1,046 fatalities per year.
  • Ohio’s overall traffic fatality rate of 0.88 fatalities per 100 million vehicle miles of travel in 2013 is lower than the national average of 1.09.
  • The traffic fatality rate on Ohio’s non-Interstate rural roads in 2013 is more than three times higher than on all other roads and highways in the state – 1.91fatalities per 100 million vehicle miles of travel compared to 0.58.
  • Several factors are associated with vehicle crashes that result in fatalities, including driver behavior, vehicle characteristics and roadway features. It is estimated that roadway features are likely a contributing factor in approximately one-third of fatal traffic crashes.
  • Where appropriate, highway improvements can reduce traffic fatalities and crashes while improving traffic flow to help relieve congestion. Such improvements include removing or shielding obstacles; adding or improving medians; improved lighting; adding rumble strips, wider lanes, wider and paved shoulders; upgrading roads from two lanes to four lanes; and better road markings and traffic signals.
  • Investments in rural traffic safety have been found to result in significant reductions in serious traffic crashes. A 2012 report by the Texas Transportation Institute (TTI) found that improvements completed recently by the Texas Department of Transportation that widened lanes, improved shoulders and made other safety improvements on 1,159 miles of rural state roadways resulted in 133 fewer fatalities on these roads in the first three years after the improvements were completed (as compared to the three years prior).  TTI estimates that the improvements on these roads are likely to save 880 lives over the next 20 years.
  • The chart below details the average number of traffic fatalities in each of Ohio’s largest urban areas from 2011 to 2013.

THIP OH 4Traffic congestion causes significant delays in Ohio, particularly in larger urban areas, choking commuting and commerce. Traffic congestion robs commuters of time and money and imposes increased costs on businesses, shippers and manufacturers, which are often passed along to consumers.

  • Traffic congestion adds significant costs to consumers, transportation companies, manufacturers, distributors and wholesalers and can reduce the attractiveness of a location to companies looking to expand or locate a new facility. Congestion costs can also increase overall operating costs for trucking and shipping companies, leading to revenue losses, lower pay for drivers and employees, and higher consumer costs.
  • The chart below details the average annual number of hours lost to congestion by each motorist in Ohio’s largest urban areas.

TRIP OH 5The efficiency of Ohio’s transportation system, particularly its highways, is critical to the state’s economy. Businesses rely on an efficient and reliable transportation system to move products and services. A key component in business efficiency and success is the level and ease of access to customers, markets, materials and workers.

  • Annually, $493 billion in goods are shipped to sites in Ohio and another $563 billion in goods are shipped from sites in Ohio, mostly by truck.
  • Seventy-eight percent of the goods shipped annually from sites in Ohio are carried by trucks and another 14 percent are carried by courier services or multiple mode deliveries, which include trucking.
  • Businesses have responded to improved communications and greater competition by moving from a push-style distribution system, which relies on low-cost movement of bulk commodities and large-scale warehousing, to a pull-style distribution system, which relies on smaller, more strategic and time-sensitive movement of goods.
  • Increasingly, companies are looking at the quality of a region’s transportation system when deciding where to re-locate or expand. Regions with congested or poorly maintained roads may see businesses relocate to areas with a smoother, more efficient and more modern transportation system.
  • Highway accessibility was ranked the number two site selection factor behind only the availability of skilled labor in a 2013 survey of corporate executives by Area Development Magazine.
  • The Federal Highway Administration estimates that each dollar spent on road, highway and bridge improvements results in an average benefit of $5.20 in the form of reduced vehicle maintenance costs, reduced delays, reduced fuel consumption, improved safety, reduced road and bridge maintenance costs and reduced emissions as a result of improved traffic flow.

The federal government is a critical source of funding for Ohio’s roads, highways and bridges and provides a significant return to Ohio in road and bridge funding based on the revenue generated in the state by the federal motor fuel tax.

  • From 2009 to 2013, the federal government provided $1.19 for road improvements in Ohio for every dollar the state paid in federal motor fuel and other highway user fees.
  • Since 2008, the federal government has augmented Highway Trust Fund revenues with $63 billion in general fund revenues, which has resulted in states getting back an average of $1.31 for road improvements for every $1 contributed in federal motor fuel fees and other highway user fees from 2009 to 2013.
  • Many needed projects throughout the state will require significant federal funding in order to proceed by 2020. These projects include reconstruction of portions of Interstates 70 and 71 in the Columbus area, the reconfiguration of portions of Interstate 270 in the Columbus area, the widening of a portion of Interstate 80 in the Youngstown area, the widening and reconstruction of a portion of Interstate 77 in Cuyahoga County, the reconstruction of the Main Street/Broadway Street interchange with Interstate 76 in Akron, the construction of the Opportunity Corridor highway in the Cleveland area, the reconstruction and widening of portions of Interstate 75 in the Cincinnati area and the replacement of the Brent Spence Bridge over the Ohio River in Cincinnati. A full list of projects threatened by a lack of federal funding can be found in the report’s Appendix.

Sources of information for this report include the Federal Highway Administration (FHWA), the Ohio Department of Transportation (ODOT), the Bureau of Transportation Statistics (BTS), the U. S. Census Bureau, the Congressional Budget Office (CBO),the Texas Transportation Institute (TTI), the American Association of State Highway and Transportation Officials (AASHTO) and the National Highway Traffic Safety Administration (NHTSA). All data used in the report are the most recent available.

 

ARTBA-Supported Ad Campaigns Launched on Multiple Fronts to Push Highway Trust Fund Fix

d9cdad69-e8aa-4830-b455-58392c53ea55Ads Coincide with House & Senate Tax Committee
Hearings this Week on Long-Term Transportation Funding

The American Road & Transportation Builders Association (ARTBA) and its industry allies are launching advertising campaigns on multiple mediums this week to draw congressional attention to the urgent need to find a permanent solution for the federal Highway Trust Fund (HTF).

ARTBA is running a 60-second television ad touting its “Getting Beyond Gridlock” (GBG) proposal.  GBG marries a 15 cents-per-gallon increase in the federal gas and diesel motor fuels tax with an offsetting federal tax rebate for middle and lower income Americans for six years, if necessary. The plan would fund a six-year, $401 billion, highway and public transit capital investment program and provide sustainable, user-based funds to support it for at least the next 10 years.  The TV spot will air multiple times June 16-18 on Fox and CNN inside Washington, D.C.  Watch the ad.

The association has also deployed companion digital ads that direct congressional staff to the GBG website for additional information about how their states would benefit from the program’s implementation.

The HTF is the source, on average, of more than 50 percent of highway and bridge capital investments made annually by state governments.  The latest funding authorization for the highway and public transit program expires July 31.  The House Ways & Means and Senate Finance Committees are holding hearings this week to explore long-term funding options to improve the trust fund’s fiscal health.

ARTBA said it has also produced a new print ad that will run this week in Capitol Hill publications.  “There is one sure way to sustainably end the Highway Trust Fund’s chronic cash flow problem… and not just for five or six years.  Increase the federal motor fuels excise rate by 15-cents per gallon and index it to inflation,” the ad reads.  “The government’s energy experts see pretty stable short term motor fuel consumption ahead.  Adjusting the gas and diesel excise rate now will result in a highly predictable and reliable revenue stream for Highway Trust Fund investments for years to come,” the ad concludes.

To compliment these efforts, the ARTBA co-chaired Transportation Construction Coalition (TCC) and the American Public Transportation Association are partnering on a 60-second television ad this week highlighting President Ronald Reagan’s 1982 gas tax increase proposal to support highway and public transit improvements.  It will air June 16-18 on CNN and Fox News inside Washington, D.C.  The TCC is also running a companion June 16-18 during morning and afternoon drive time on Washington’s top rated, news talk station, WTOP.

New Wave of TV, Print, Radio & Digital Ads Target Members of Congress & General Public on Highway Trust Fund Fix

ee0d071a-4431-491a-ae5f-0d9154114fae1982 Reagan Gas Tax Proposal Highlighted

The Transportation Construction Coalition (TCC) and industry allies have launched a new television, radio, print advertising campaign to put increased pressure on Congress to fix the Highway Trust Fund (HTF), and boost federal highway and public transit investment.  The TCC is also utilizing digital ads asking commuters in key states to contact their congressmen and senators on the issue.

The effort highlights how conservative and tax-cutting champion President Ronald Reagan got it right when he said that “common sense” tells us that it’s less expansive to keep our transportation infrastructure in good repair than to let it crumble and have to rebuild.

Reagan also was on the money when he added that, wherever possible, assessing a fee on the people who benefit from a public service is “good tax policy” to pay for that service.

“Our highways were built largely with such a user fee – the gasoline tax,” Reagan said in a November 1982 radio address to the nation. “I think it makes sense to follow that principle in restoring them to the condition we all want them to be in.”

The 60-second television ad, sponsored by the TCC and the American Public Transportation Association (APTA), airs June 16-18 on Fox News and CNN inside Washington, D.C., and is scheduled to coincide with this week’s House Ways & Means and Senate Finance Committee hearings on the future of transportation financing.  Watch the ad.

The latest funding authorization for the highway and public transit program supported through the HTF expires July 31.  Congress continues to struggle in reaching agreement on a sustainable funding solution.

The TCC is also rolling out a 60-second radio ad featuring Reagan, which airs June 16-18 during morning and afternoon drive time on WTOP, D.C.’s top news-talk station.  Listen to the spot.

Complimentary, full-page TCC print ads will appear this week in Capitol Hill publications.  The ads call for an increase in the federal gas tax and note that nearly 90 percent of Republican and Democratic state legislators who voted to increase their state’s gas tax or equivalent during the last election cycle to fund transportation improvements were re-elected.  The TCC has also placed companion digital ads targeting congressional staff.

The TCC initiative extends beyond the Nation’s Capital and features digital advertising targeting voters in the states of these congressional and tax committee leaders:

  • House Ways & Means Committee Chairman Paul Ryan (R-Wis.)
  • House Speaker John Boehner
(R-Ohio)
  • Senate Finance Committee Chairman Orrin Hatch (R-Utah)
  • House Majority Leader Kevin McCarthy (R-Calif.)
  • Senate Majority Leader Mitch McConnell (R-Kentucky)
  • House Majority Whip Steve Scalise (R-La.)
  • Senate Minority Leader Harry Reid
(D-Nev.)
  • Senate Finance Committee Ranking Member Ron Wyden (D-Ore.)
  • House Minority Leader Nancy Pelosi (D-Calif.)
  • Tom Price Price (R-Ga.) Rep. Diane Black (R-Tenn.)
  • Todd Young (R-Ind.)
  • Richard Burr (R-N.C.)
  • Pat Toomey (R-Pa.)
  • Sen. Tim Scott (R-S.C.)

When clicked on the digital ads will take voters to a petition  that they can sign and have sent to their respective members of Congress.

The TCC says it plans to continue a wide-range of advertising and grassroots activities in the run up to the July 31 deadline to keep the pressure on Congress to fix the HTF and then pivot to passage of a long-term surface transportation bill.

Established in 1996 and co-chaired by the American Road and Transportation Builders Association and the Associated General Contractors of America, the 31 associations and labor unions that make up the TCC have a direct market interest in the federal transportation program.  TCC members include:

American Road & Transportation Builders Association (co-chair); Associated General Contractors of America (co-chair); American Coal Ash Association; American Concrete Pavement Association; American Concrete Pipe Association; American Council of Engineering Companies; American Subcontractors Association; American Iron and Steel Institute; American Society of Civil Engineers; American Traffic Safety Services Association; Asphalt Emulsion Manufacturers Association; Asphalt Recycling & Reclaiming Association; Associated Equipment Distributors; Association of Equipment Manufacturers; Concrete Reinforcing Steel Institute; International Slurry Surfacing Association; International Association of Bridge, Structural, Ornamental and Reinforcing Iron Workers; International Union of Operating Engineers; Laborers-Employers Cooperation and Education Trust; Laborers’ International Union of North America; National Asphalt Pavement Association; National Association of Surety Bond Producers; National Electrical Contractors Association;  National Ready Mixed Concrete Association; National Steel Bridge Alliance; National Stone, Sand and Gravel Association; National Utility Contractors Association; Portland Cement Association; Precast/Prestressed Concrete Institute; The Road Information Program; and United Brotherhood of Carpenters and Joiners of America.

ARTBA Statement from Capitol Hill News Event on Federal Transportation Funding

d9cdad69-e8aa-4830-b455-58392c53ea55The following is the statement delivered today by American Road & Transportation Builders Association (ARTBA) Executive Vice President & Chief Operating Officer Bill Toohey at a Capitol Hill news conference with senators to discuss highway and transit funding

“It’s a truism that has been said many times before: we do not have a Republican road network. We do not have a Democratic road network. We have an American road network… an American bridge network… and an American transit network.

“And if one thing has been learned over the past decade, it’s that neither political party has had the will to enact a long-term funding solution when they had the numbers and opportunity to do it. It is going to take bipartisan cooperation… a bipartisan solution… and bipartisan political risk to get the job done.

“And by long-term solution, we do not mean a four- to six-year patch. That will just leave us facing another $16 billion a year-plus funding cliff at the end of the next authorization. We want a sustainable funding solution to put this critical national program back on solid footing for the next decade.

“While some are worried about the political consequences of voting for a real trust fund fix, the rest of America is worried about commute times growing… bridges being closed… shipping costs increasing… and jobs being lost.

“It’s time for both parties to work together for America to put this behind us.”

ABC Construction Economic Update

NRAssociated Builders and Contractors (ABC) launched its state-by-state economic analysis earlier this year with the release of economist Bernard Markstein’s  analysis of construction’s contribution to each state’s gross domestic product. Markstein also compiles the construction unemployment rate of each state, each month. Unique to ABC, Markstein’s analysis of the construction job market and unemployment rate in each state for April is below. 

This analysis is produced monthly in addition to ABC’s existing national economic data and analysis. Background on how the data was derived and Markstein’s methodology is available on ABC’s website. Markstein is also available for an interview to provide further analysis

Overview

The United States economy, along with the construction economy, struggled through the first quarter as the nation was battered with unusually harsh weather. As of the May 29 U.S. Department of Commerce report, real (inflation-adjusted) gross domestic product (GDP) fell 0.7% at a seasonally adjusted annual rate (SAAR). The June 1 construction spending report showed that nominal (current) dollar construction spending was down 0.5% (SAAR), but on a not seasonally adjusted (NSA) basis was up 3.7% compared to first quarter 2014.

Indications show that with better weather, the economy and construction are rebounding from that poor performance in the first quarter. For the first four months of the year, NSA construction spending was 4.1% higher than the same period a year ago. Among the big gainers in construction spending for the first four months of the year compared to the same period in 2014 were manufacturing (+42.0%), lodging (+15.9%), office (+18.5%), commercial (16.7%) and multifamily (+26.3%).

With the combination of improving weather and a rebound from a dismal first quarter, hiring in construction has improved. The Bureau of Labor Statistics (BLS) reported that April seasonally adjusted (SA) construction jobs for the United States increased by 45,000 and that year-to-date SA construction jobs were up 108,000. Additionally, NSA construction employment has increased by 300,000 on a year-over-year basis.

The April NSA construction unemployment rate for the country and the estimated construction unemployment rates for 49 states declined from their respective March rates. Only Hawaii, whose unemployment rate includes mining, rose from its March estimate. The year-over-year change in the construction unemployment rates provides an even better indication of how construction industry employment is progressing. Construction unemployment rates for 45 of the 50 states and the U.S. rate were down in April 2015 from April 2014.

The Top Five States

The five states with the lowest construction unemployment rates (the construction and mining unemployment rates where noted below) from highest to lowest were:

  •   Wyoming
  •   South Dakota*
  •   Nebraska*
  •   North Dakota
  •   Utah

* Includes construction and mining unemployment rate

The top four—Wyoming, South Dakota, Nebraska and North Dakota—are in the same geographic area, with fifth-ranked Utah nearby. Wyoming, Nebraska, North Dakota and Utah were also among the five states with the lowest construction unemployment rates in March. Note that Montana, which would fit in geographically with the top four, had the eighth lowest construction unemployment rate.

Wyoming took over first place from Nebraska, which fell to number three. This was an exchange of their March rankings mainly due to Wyoming’s larger drop in its construction unemployment rate rather than poor performance on Nebraska’s part.

Second place South Dakota moved up from a revised fourth place in March (originally estimated as sixth place) sending North Dakota to fourth place in April. Finally, Utah held its fifth place rank between the two months.

The Bottom Five States

The five states with the highest construction unemployment rates (from highest to lowest) were:

  •   West Virginia
  •   Georgia
  •   California
  •   Rhode Island
  •   Connecticut

Among the states with the five highest construction unemployment rates in April, four of the five remained the same as in March, though in a different order. West Virginia went from third highest in March to highest in April. It was also the only state in the bottom five that saw its construction unemployment rate increase on a year-over-year basis.

The West Virginia economy has been struggling in recent months as the state has suffered setbacks in one of its major industries—coal. That has been compounded by the drop in energy prices, adversely affecting its natural gas industry. Also, as West Virginia has become more export oriented, the rise in the foreign exchange value of the dollar has been another drag on its economy. In terms of construction, from April 2014 to April 2015, West Virginia had the greatest loss of construction jobs of any state both on a percentage and absolute number basis.

Georgia went from fifth highest construction unemployment rate in March to second highest in April even as it experienced a solid 2.2% drop in that rate from April 2014. Georgia’s decline in the rankings is less about a poor economy (although its construction unemployment rate is in the low double digits) than that other states improved more.

This also appears to be the case for California whose construction unemployment rate went from tied for tenth highest in March to third highest in April. Again, although that rate fell both on a monthly and a year-over-year basis, it remained in the low double digits.

Rhode Island improved from the worst construction unemployment rate in March to fourth worst in April. New Jersey, which was fourth worst in March, also improved three notches to seventh worst as its April rate fell to just below 10%.

Connecticut was another state moving up three places from second worst in March to fifth worst in April. Both of these New England states, Rhode Island and Connecticut, have suffered from a harsh winter and a slow recovery from the recession, but appear to be showing some signs of life.

Conclusion

Most states are showing improvement from a difficult first quarter. This results in some relatively large percentage increases in some of the numbers (e.g., April SA total housing starts jumped 20%). However, when taking a longer-term overview and averaging out those fluctuations, the economic picture is one of slow but steady advancement. It seems unlikely there will be any sustained surge in activity anytime soon, but no serious backsliding either. Although greater growth would be preferred, slow and steady beats a decline in activity.

Read more on ABC’s website.