Highway cash will stay in bank
The state may have some $300 million in its highway bank account, but it’s unlikely that the surplus will fund additional projects, according to highway officials.
This week, state legislators criticized the management of the highway program and questioned whether more projects could be undertaken with the huge balance sitting in the highway account.
“Taxpayers expect their dollars put into highways to be spent expeditiously,” said state Sen. Peggy Reeves, D-Fort Collins. “We don’t want them to have large cash balances.”
Since the $300 million is “encumbered” or committed to projects that are currently approved, it cannot be used to pay for new projects, according to a highway department spokesman.
“When we sign a contract, we have to have all that money up front even if it’s a multiyear project and the billing’s stretched out,” said Dan Hopkins, spokesman for the Colorado Department of Transportation.
“It’s just the law,” confirmed Ralph Trapani, chief engineer of Highway 82 projects. “The Colorado constitution doesn’t allow deficit spending.”
But one state senator wondered if the large cash balance was a sign that management of the state’s highways isn’t keeping up with the increasing demands on the program.
“This confirms my fear that we are throwing too much money at highways without the capacity to actually do what we’re promising,” said Sen. Doug Linkhart, D-Denver.
In response to the legislators’ criticisms, CDOT Executive Director Tom Norton said he plans to break down projects into smaller jobs, so not as much money will be tied up before it’s needed.
But Hopkins noted that approach is neither “easily done” nor always in the taxpayers’ best interest.
“It may make sense in some cases, but it won’t make sense in all projects,” Hopkins said. “This summer we’re going to start work on Snowmass Canyon, which is a $100 million, five-year project. Because of economy of scale, with the same contractors committed to different phases, it could have cost much more if broken up.”
The cash balance in the highway fund is invested if it’s not needed immediately and last year earned $14 million in interest, according to Norton, who added that he would prefer to see the money invested in roads than collecting interest.
The Associate Press contributed to this report.
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