"Shovel Ready" Enough for Funding? Analysis of Stimulus Funds for Road Construction and Repairs

This morning I read Brad Heath's article in USA Today, suggesting that the stimulus funding for road repairs has detoured and by-passed large metro areas with significant road problems.

Stimulus Projects Shovel Ready?

According to the USA Today study, half of the nation’s worst roads will receive only about 20% of the stimulus money allocated for street repairs. The reason—the roads were not shovel ready and were in too bad shape:

“The problem is a byproduct of a stimulus package designed to spend as fast as possible to revive the economy. Many roads are in such bad shape that repairs would take too long and cost too much to qualify for funds, says John Barton, head of engineering for Texas' Department of Transportation.

The result is that counties with the worst roads won't get much more repair money than counties with better roads. The 74 counties with half of the nation's bad roads will split $1.9 billion, records show; counties with no major roads in bad shape will split about $1.5 billion.”

Data compiled and reviewed by USA Today showed that many of the roughest roads needing repair were … let’s say … not ready for repair.  For example, state officials acknowledged that “Detroit's roads are in dire need of work, but say they didn't have enough ready-to-go projects there.”

According to Kent Starwalt, Executive Vice-President of the Tennessee Road Builders Association, the important question is not whether transportation projects are shovel ready, but rather, why weren’t these projects shovel ready?

“It would seem that if a jurisdiction’s roads are in really poor condition, they would have the necessary steps done to be able to move on projects when and if they did receive money. [Tennessee Department of Transportation] and many other state DOTs were well prepared for such a scenario. The cities were even given more time than the states in the stimulus bill to obligate any money they were to receive.”

This is more than just an issue of timing and money. One measure of the House transportation re-authorization bill includes the transfer of control from state departments to city and metropolitan planning organizations. However, Starwalt warns: “It should be obvious to everyone involved that the cities are not as efficient in getting projects out the door as state DOTs.”

This debate is interesting to those of us who follow the federal stimulus funds with the hopes that the funds actually impact the construction industry, the workers and employees involved in the projects and the local economies.

Recovery.com versus Recovery.gov: Tracking Public Construction Projects

I was listening to Nashville Public Radio yesterday morning about a new competition brewing on the Internet.  This battle was not as fierce as the one to become the greenest state in the South.  It was more like a friendly exchange of "we're not in competition with each other because we offer similar, but different services" battle.

The NPR story featured the two primary websites that assist in tracking stimulus dollars: www.recovery.gov and www.recovery.com.  (There is actually a third URL at www.recovery.org, which is the real face of the Dot-Com website.)  The Dot-Com and Dot-Org websites are owned by Onvia, a company that provides various public procurement and reporting services to business and governments.  Through its public spokesperson Erika Lindsay, Onvia responded to my inquiry about its stimulus tracking information: 

Recovery spending is a small subset of overall government spending that we already track. Each day we capture the [American Recovery and Reinvestment Act of 2009] funded project level events from all levels of government and from all geographies and present them real-time on www.recovery.org . This includes details on projects that have dollars committed but have not yet started (Allocated), formal bid requests and RFPs (Advertised) and contract award notices (Awarded).

The Obama Administration's version of the stimulus-tracking database is maintained at www.recovery.gov, which was officially established as part of the American Recovery and Reinvestment Act of 2009:

The [Recovery Accountability and Transparency] Board shall establish and maintain...a user-friendly, public-facing website to foster greater accountability and transparency in the use of covered funds. The website...shall be a portal or gateway to key information relating to the Act and provide connections to other government websites with related information.

First, what's the real difference between these two sites? The real difference appears to be the timeliness of the information that is publicly available for viewing.  The Dot-Com site is updated in real time as data is received about public lettings, awards and receipt of information about project spending ... whereas the Dot-Gov site ... well, is not so quick.  According to the NPR article, the commercial website "has spending information that the government won't have until October."  The other major difference?  Onvia allows public comment on particular projects, which tends to generate a lot of buzz about the use of funds for certain projects.

Why is this important for the construction industry?

  • Setting aside the Dot-Com v. Dot-Gov distinction, both of these sites provide useful information on the status of stimulus funded projects. 
  • Although there appears to be more money in the pipeline for construction work (...which was supposed to lead to job creation...), the data that is available illustrates that the stimulus money is slow to reach the market.
  • Finally, information released on the sites actually supports the trend that is being reported about "lower bids" throughout the industry.  In other words, public contract awards are "coming in 16 percent lower than usual" according to www.recovery.com figures. 

The best part about the NPR story ... one project that has already been awarded is an $18 million contract for a complete redesign of www.recovery.gov

 
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