Construction projects on federal roads in South Carolina may slow to a crawl this fall unless Congress prevents the Highway Trust Fund from going broke.
South Carolina, along with the rest of the country, has been anxiously waiting for Congress to keep federal transportation aid flowing to states for another four years. If it doesn't happen by Aug. 1, South Carolina will have to slow down or cut back on new projects scheduled for the fall, said Jim Warren, SCDOT deputy secretary for finance and procurement.
The feds have warned that if Congress doesn't resolve the cash flow issue, they'll have to modify their reimbursement procedures. That could mean delays in paying back states for the construction they have underway for federal projects. Warren says, however, that SCDOT has enough cash in its coffers to pay for projects that are underway.
"As of right now, I see no reason why we won't be paying our vendors on time," Warren said. "If there's a long-term obstruction, we'll have to study it much harder and make whatever adjustments necessary to make sure our suppliers and contractors are paid on a timely basis."
That could mean stopping any projects from even starting in the fall. It could also mean the temporary halt of state-level projects to funnel the cash to cover those federal projects that have already started. That's something that alarms Sens. Larry Grooms, R-Charleston, and Ray Cleary, R- Murrells Inlet.
"Once the Federal Highway Trust Fund is at zero balance, they will not be able to reimburse the states for federally authorized work," Grooms said. "It'll hurt our state more than most other states because we're so heavily dependent on the Federal Highway Trust Fund."
Cleary called the potential halt in cash an "extreme crisis" in South Carolina that could have been prevented.
"Quite honestly, when they talk about the sky falling, most people are exaggerating," Cleary said. "In this particular case, I don't think Sen. Grooms is exaggerating."
Because South Carolina lawmakers and leaders have not addressed how to fund the state's roads properly, there's not enough state-level cash to fall back on, Clearly said. Whereas some states pay out of their pockets for projects and turn to the federal government on a biannual or annual basis for reimbursement, South Carolina does it on a bi-weekly basis.
"We rely on the federal government to help us maintain our roads," Cleary said. "And we're paying the piper now."
But the federal potential impact on a state level did not creep up on anyone. Grooms has been pushing for SCDOT to scale back on its bidding for projects since January. And Eric Dickey, chairman of South Carolina Alliance to Fix Our Roads, said anyone in the highway industry has known about the problem since earlier this year.
"We're in big time trouble come Aug. 1," Dickey said. "I don't think projects will stop immediately, but they'll slow down dramatically."
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