Key Construction Programs See Funding Cut

On February 1, President Obama unveiled his $3.8 trillion budget for fiscal year 2011. The budget projects a deficit of $1.27 trillion while placing a total freeze on non-security domestic spending.  That freeze has resulted in cutbacks in most of the key federal construction accounts.  According to AGC's analysis,  the Administration's proposed total of $112.4 billion for construction projects represents a nearly $9 billion, or 7.5 percent, decrease from the $121.5 billion appropriated for construction projects in FY 2010 (this does not include ARRA funds). While the budget recommends a mix of increases and reductions in programs across market areas, it does recommend boosting a few construction programs (albeit very modestly) including 1 percent increases for both the highway and transit programs.  In addition, the Administration is calling for the creation of a $4 billion National Infrastructure Bank for transportation projects of regional or national significance. In contrast, the proposed budget cuts the construction budget for the Army Corps of Engineers' Civil-Works Program from $2 billion in 2010 to $1.7 billion, a 17% decrease.  The Environmental Protection Agency budget would cut the Clean-Water State Revolving Funds by 5% to $2 billion and the Drinking Water State Revolving Funds by 7% to $1.2 billion. The President's budget is simply a request of the Administration's priorities for the next fiscal year and the first step in the federal budget process.  AGC will continue to advocate for the increased federal investment in the nation's infrastructure and public facilities through the nearly 100 construction programs at the federal level. A cover-page story from Engineering News Record about President Obama's 2011 budget request, quotes AGC's CEO, Steve Sandherr, talking about how the budget has a mixed outlook for construction, the positives being the President continues to see investing in infrastructure as a good way to boost the economy.  The negatives include significant cuts to the Army Corps of Engineers budget. For a chart compiled by AGC that compares the Administration's FY 2011 budget request, click here. For more information contact Sean O'Neill at neills@agc.org or 202-547-8892.