West Virginia’s federal aid funding for highway construction could face delays if a bill to replenish the Highway Trust Fund doesn’t make it through Congress before the deadline as lawmakers in Washington struggle to reach any agreement. As a result, current levels of funding could run out next month and that could affect some 112,000 construction projects.
More importantly, about 700,000 jobs nationwide would also be affected if Congress doesn’t act to reauthorize federal transportation funds. West Virginia, just like the other states, receives reimbursements from the government for federal highway projects.
Brent Walker, a spokesman for the West Virginia Department of Transportation, said last week these delays could “put our cash flow in a critical state.” He said the turnaround on these reimbursements is “critical” to the state’s highway construction work.
“Our federal aid funding is about $425 million a year,” Walker said. “That’s a significant portion of our program. If that were to happen, we would have to halt all of our active construction contracts. This would be until a long-term solution would be put in place.”
The finance committee in the Senate tried to speed things up by introducing legislation that would provide $9 billion to the trust fund over six months. But committee leaders decided to pause markup on the bill in the hope that a bipartisan deal could be reached before the money runs out.
Federal Transportation Secretary Anthony Foxx has warned states they will start seeing cuts of 28 percent in federal funding for roads and bridges next month if Congress doesn’t come up with some extra money. And President Obama urged Congress last week to come up with a quick solution.
This isn’t the first time Congress has been slow to act on highway funding. Members passed nine short-term extensions between 2009 and 2012 before approving a two-year measure that expires this year. According to Walker, state departments of transportation are accustomed to dealing with this kind of uncertainty, but this time the threat is larger because the money could disappear soon.
“We’ve weathered the storm before,” Walker told a reporter for the Charleston Daily Mail. “We honestly don’t have any reason to think it is not going to happen again.”
U.S. Sen. Jay Rockefeller said he has “long called for Congress to get serious about investing in our transportation infrastructure to help preserve our state’s economy. . . and protect the lives of drivers and passengers.” And both Rep. Nick Rahall and Rep. Shelley Moore Capito have said they are working to help resolve the issue.
Meanwhile, as a veteran of almost 40 years working in West Virginia’s coal mines and a fifth-generation miner who retired about six years ago, Boone County miner Robert Schultz was counting on his pension allowing him and his wife to spend more time at the beach in retirement.
He retired about six years ago, but recently he received a letter from the U.S. Labor Department telling him that his pension was in financial trouble and his benefits might need to be cut. “We’re talking about people not getting what they need,” Shultz told reporters for Bloomberg News.
A surge in demand for coal overseas may have raised coal’s outlook in the short run but it hasn’t reduced long-term job losses, which could get even worse with proposed U.S. limits on power plant emissions. And competition from non-union operators has made matters worse, cutting employer contributions to the main pension plan for union miners that has caused a “seriously endangered” rating from pension regulators and raising the prospect of a government rescue.
Dominating the pool of underfunded plans is the one for the United Mine Workers of America and the fund for the International Brotherhood of Teamsters. And if either one of these plans should fail, the Pension Benefit Guaranty Corporation — the government-run agency that backs employee pension plans — may have to take over, according to Randy Defrehn, executive director of the National Coordinating Committee of Multiemployer Plans, the group that advocates for pension operators.
Finally, former governor Bob Wise is convinced West Virginia must do a better job in higher education. Now head of the Alliance for Excellent Education in Washington D. C., he told a reporter recently that a college education “is not a luxury anymore. It’s a necessity to have a good work force.” And a 2013 study by Georgetown University concluded this state’s colleges and universities need to produce 20,000 more graduates by 2018 to sustain this state’s economy.
Wise was able to get the Promise Scholarship program funded while he was governor in 2002. But lawmakers voted to cap the scholarship at $4,750 to ensure the program would remain adequately funded in 2009. The only hitch is that the average tuition in West Virginia has now doubled from only $2,868 in 2002 to more than $6,000 today. And another issue is that only 62 percent of Promise scholars remain in the state after graduating from college. Wise doesn’t consider that a negative because people may leave the state for a job after college but many of them return later in life.