June 27, 2017

The Federal Highway Administration issued an official notice late last week of how a cut of $857 million in highway contract authority held by state DOTs will be implemented on June 30.

President Obama’s FY 2017 budget proposal balanced some of its books by proposing a $2.4 billion highway rescission. The Senate lowered that amount to $2.2 billion and the House ignored the proposal. The final compromise was an $857 million cut.

The law requires FHWA to calculate the rescission proportionately, by state and program, based on the unobligated amounts held by the states as of May 31, 2017. While safety programs and certain funds sub-allocated to metro areas based on population were exempted from the rescission, almost 60 percent of the cut was taken from the “core construction” programs (the current NHPP and non-suballocated STBGP, and the old IM, NHS, non-allocated STP and on-system bridge programs).

But those programs represent far more than 60 percent of total highway formula funding. This rescission, like previous rescissions, winds up disproportionately cutting programs that are not part of the fungible core construction money. The CMAQ program only represents about 7 percent of new highway formula money subject to the rescission but represented about 14 percent of the rescission because many states find it hard to spend CMAQ money. Transportation enhancements and planning programs also took very disproportionate shares of the rescission.

The tables below show the $857 million by program on a national basis and then shows total funding rescinded by state. Table 2 of the FHWA Notice shows how much each state lost from each individual program.

RESCISSION TOTALS BY STATE