The Department of Transportation has updated its Highway Trust Fund ticker to say that the federal government is now projected to run out of money for infrastructure projects in June 2016, six months later than previously expected.
The agency says that an $8 billion extension passed by Congress in July for the beleaguered highway fund will cover payments to states for transportation projects until the end of the third quarter of the 2016 fiscal year.
The extension had been expected to provide infrastructure funding only until December 2015 when it was approved, but transportation officials said they would be able to make the dollars stretch further than expected because the pace of U.S. construction typically slows down greatly in the winter.
The agency is cautioning Congress, though, that it will still have to pass an extension of the federal policy that authorizes the transportation spending by Oct. 29.
“The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (P.L. 114-41) authorized General Fund transfers to the Highway Account and Mass Transit Account of the Highway Trust Fund. These transfers will help maintain Highway Trust Fund solvency through the third quarter of fiscal year (FY) 2016,” the transportation department said in an Aug. 20 blog post about the highway funding projection.
“However, it is important to note that many programs funded through the Highway Trust Fund are only authorized through October 29, 2015,” the agency continued. “Although sufficient balances exist in the Highway Trust Fund to maintain solvency through the third quarter of FY 2016, an October 29th lapse in authorization prevents new obligations in Highway and Transit programs and impacts reimbursements to States.”
The extra cushion could give lawmakers cover to pass another temporary extension of federal highway funding instead of finishing work on a multiyear transportation bill, which has been sought by infrastructure advocates for years.
When lawmakers were facing a similar transportation funding deadline in May, they opted to pass an extension until only July because the spending could be covered by Highway Trust Fund reserves.
The policy authorization expiration date and the highway fund’s projected date for running out of money coincided in July, forcing lawmakers to approve an $8 billion for the infrastructure pot.
Lawmakers cast the July extension at the time as a stopgap on the road a multiyear highway bill this fall, but the update from the transportation could lull lawmakers back toward another temporary patch.