RALEIGH, N.C. — North Carolina government would need billions of dollars in additional road-building funds if it wants to carry out currently planned projects for the next decade, according to recent cost reassessments.
The gap between the costs for committed Department of Transportation projects and available funding from 2024 to 2033 is at least $7 billion, a news outlet reported.
Highway projects could be dropped from the State Transportation Improvement Program — North Carolinaβs building roadmap — or simply not be added.
βIt is a problem,β Joey Hopkins, DOTβs deputy chief engineer for planning, told the station.
Project cost increases were counted during a routine re-estimate during the COVID-19 pandemic, which has contributed to rising material costs and uncertain job markets. Real estate prices also have increased, leading to rising costs to buy property to build or widen roads.
βWhat weβre dealing with now in our market β¦ the cost increases weβre dealing with now are unprecedented,β Hopkins said. βThe housing market, our right-of-way costs, sometimes seem to be going up daily.β
With a current DOT cash balance of $2 billion, the departmentβs 12- and 36-month contract lettings shouldnβt be affected, Hopkins said. Looking to the long term, DOT says itβs talking to local leaders statewide about scaling projects without eliminating them.
Nearly all of DOTβs annual revenues come from state and federal gasoline taxes, a 3% tax on vehicle sales and Division of Motor Vehicle fees. Longer-life vehicles and those with higher gas mileage are affecting road revenues nationwide, trimming back gas and vehicle sales tax revenues.
Cumulative available funding for 2024-2033 is currently estimated at $23.5 billion, according to a DOT presentation.
A blue-ribbon commission recommended in January that North Carolina boost transportation spending by 40% to improve highways, railroads and transit. The panel said the state needs to locate at least $2 billion more annually to get there.
Approving more taxes and fees for transportation would be politically tricky for the Republican-controlled General Assembly and Gov. Roy Cooper, a Democrat.
The overruns are a βsymptom of the problem of our revenue streams being out of date,β said Sen. Mike Woodard, a Durham County Democrat. βIt makes it clear that we need to modernize the DOTβs revenue, and thatβs going to be a heavy lift, but itβs past time to roll up our sleeves.β
The state Board of Transportation probably wonβt approve the next State Transportation Improvement Program until summer 2023, Hopkins said. Some costs could come down between now and then.
βI just want to reiterate: Weβve got time to work this out,β Hopkins said.