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Lack of State Budget Affects $3 Billion in Projects, Caltrans Says

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Prior to California Transportation Commission allocation meetings this week, Caltrans sent a “White Paper” to Dale Bonner, secretary of the state Business, Transportation and Housing Agency, which oversees the department, outlining drastic measures the department will have to make if the state budget is not passed – and passed quickly.

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Cindy McKim, Caltrans director, says that if the current budget impasse continues through the end of August, “transportation fund cash balances may be depleted resulting in potential suspension of ongoing construction projects.” McKim says that if the impasse carries on into September, the department would have to stop or delay the start of $3 billion worth of transportation projects, plus delay contractor payments on $9.5 billion worth of current construction.

“The absence of fiscal year 2010-11 budget authority has an immediate result of restricting Caltrans’ ability to initiate construction projects, award contracts and make payments to vendors,” says McKim.

The fiscal year 2010-11 began July 1.

In short, no budget means the delay of $1.3 billion in project awards, delay of more than $900 million of projects that were allocated with prior year budget funds and delay of nearly $650 million of bond-funded projects until the state treasurer’s office can complete the bond sale, which will not happen until a state budget is passed.

At the CTC meetings, the commission allocated $985 million to 89 transportation projects statewide, says Caltrans spokesman David Anderson.

“However, the funding allocations for all of the projects are contingent upon passage of the state budget,” adds Anderson. Also, he says the CTC deferred an additional $431 million in funding allocations from Propositions 1A and 1B due to lack of a state budget.

McKim says that without a budget and with the uncertainty of available cash for contracts after September, Caltrans will not be awarding new contracts.

Some of the major projects allocated by the CTC in April, May, June and July with September funds that have not yet been awarded include the Colorado River Bridge joint project with Arizona ($22 million), I-5 roadway rehab project in Shasta County ($35 million), I-5 roadway rehab in Sacramento ($92 million), Route 4 expansion in Antioch ($57 million) and the Carmenita Interchange improvement project on I-5 in Los Angeles ($50 million).

Ongoing impacted projects include such high-profile projects as the Caldecott Tunnel Fourth Bore (10% complete, $240 million), Devil’s Slide (62% complete, $320 million) and the San Bernardino Freeway (I-10) restoration project (36% complete, $165 million).

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