State and Federal Funding Contribute to 2020 Construction
Routine maintenance of public buildings continues to be deferred
Seward Highway MP 75-90 Road and Bridge Rehabilitation project, April 2019.
It was a long and hard-fought battle, but when Alaska’s state budget for FY2020 was finally approved this past August, things weren’t quite as grim as they at first seemed. Still, there were some major cuts—the budget for FY2020, which began on July 1, 2019, was $390 million below the previous year’s approved funding, with spending on capital projects down from $168 million in FY2019 to $144.3 million in FY2020.
The good news is that the majority of construction projects that take place in the 49th State are financed by federal funds; the bad news is that the state’s general fund, which is used to provide matching money to move these projects forward, has been reduced. The general fund is Alaska’s major source of discretionary funding and can be used to pay for government operations, basic services, and capital improvements. While most Alaska Department of Transportation and Public Facilities (DOT&PF) projects are federally funded, the state is still required to provide matching funds of around 9 to 10 percent.
Money for the routine maintenance of public buildings has also been decreased, which could have a lasting effect on properties far beyond this budget year.
According to Ben White, director of program development for DOT&PF, the majority of DOT&PF’s infrastructure projects that are currently in progress are federally funded.
“There are only a couple of General Obligation [GO] Bond-funded projects remaining, and most of these required some supplemental federal funding,” he explains. “There are a couple of state-funded projects currently under development; however, this is a very small proportion of the overall project workload for the department.”
According to White, DOT&PF anticipates moving approximately $482 million worth of highway projects into construction in federal FY2020.
“The state has more infrastructure needs than funding that is available, which means that we need to prioritize the infrastructure needs and find measures to reduce the overall project costs,” says White, adding that DOT&PF is actively working to expedite project delivery as one method to reduce project costs.
“Since the majority of DOT&PF projects are federally funded, there are federal requirements regarding delays and cancellations that could pertain,” explains White, adding that projects can be delayed for numerous reasons. “Projects have a set amount of time to advance to construction, and there are requirements for the state to reimburse federal funding on a project should it be cancelled [without sufficient cause] once started.”
Because there is less state funding available, this has created a larger reliance on limited federal funding. “DOT&PF works to balance the infrastructure needs of the state with the available funding, so this may mean that we see a reduction in new projects started over time,” White explains.
In early 2020, DOT&PF will award $50 million in transportation grant funding for the Community Transportation Program (CTP), which allows communities to submit project scope and estimate for funding. The last CTP project nomination opportunity occurred in 2011. DOT&PF is currently reviewing and scoring submissions and expects to make the awards in early 2020.
There are several larger projects already underway throughout the state, as well as some that will break ground in 2020.
In DOT&PF’s Northern Region, these include:
Chena Hot Springs Road Roundabouts: By constructing two roundabouts at the interchange, this project will result in increased safety on Chena Hot Springs Road where it meets the Steese Highway. The goal is to reduce the higher-than-average crash rate at the intersection, fix poor sight distance issues, and slow drivers as they navigate between these two high-speed roads.
This project is expected to be constructed in 2020 at a cost of approximately $5 million. It will be 100 percent federally funded through the Highway Safety Improvement Program.
Wendell Avenue Bridge Replacement: This project will replace Wendell Avenue Bridge, which is located over the Chena River in downtown Fairbanks. The new bridge will have improved pedestrian and bicycle facilities that will improve pedestrian access along the Chena River in the downtown corridor.
“This project was started in 2009 with money from GO Bonds, but was paused briefly during the Walker Administration amid deep state budget cuts,” says White, adding that the bridge, which was built in 1953, needed such extensive structural repairs that replacing it cost about the same as repairing it.
Construction is expected to start this year and last for two seasons. The cost is approximately $18 million, which is 100 percent state-funded through GO Bonds.
In the Southcoast Region, projects include:
Haines Highway Reconstruction Milepost 12.2-23: This project will realign and widen the Haines Highway between Mileposts 12 and 23. Curves will be straightened to meet a 55 mile per hour design speed, and a long-term solution to debris flow problems near mileposts 19 and 23 is included in the work. Enhancements are planned along the Chilkat River. This project is federally funded, and the engineer’s estimate is $50 million to $60 million.
Ketchikan Gravina Island Access Improvements: This project will improve access between Gravina Island and Revillagigedo Islands and involves the construction of a new ferry terminal on both the Revillagigedo and Gravina sides of the airport ferry route. It also includes reconstruction of the existing ferry terminals on both sides of the route.
“This project will expand and improve ferry terminal uplands and parking at the Revillagigedo Island ferry terminal and include a new passenger waiting shelter and roadway improvements to adjacent Tongass Avenue,” says White, adding that the federally funded project is estimated to cost $40 million to $50 million.
Central Region projects include:
Seward Highway, O’Malley Road to Dimond Boulevard: This is the third in a series of projects to improve capacity, safety, access, and connectivity on Seward Highway between Rabbit Creek Road and 36th Avenue. The current design includes the following proposed elements:
- Expansion of Seward Highway from two to three through-lanes in each direction
- Diverging diamond interchanges at O’Malley Road and Dimond Boulevard
- A grade-separated undercrossing at Scooter Avenue/Academy Drive
- Improved and new pedestrian and bicycle facilities
These enhancements are expected to improve safety throughout the project corridor; improve connections between both sides of the highway and improve access to the Dimond Center retail district for both pedestrians and vehicles; add new bike and pedestrian routes and enhance existing connections throughout the project corridor; and increase capacity at the O’Malley Road and Dimond Boulevard interchanges. Construction is expected to begin in 2022, with an estimated project cost of $80 million to $100 million.
Knik-Goose Bay Road: Construction of this project is being split into two phases combined with the adjacent Knik-Goose Bay: Vine Road to Settler’s Bay Drive project. This phasing plan will provide the greatest benefit to the most users; improve the highest volume segment first; and expedite project delivery. Phase I, which includes the construction of the Centaur Avenue to Fairview Loop Road segment, is expected to start in late 2021; construction on the Fairview Loop Road to Settler’s Bay Drive segment (Phase II) is expected to begin in 2023.
The project will expand the corridor to a four-lane divided roadway from Centaur Avenue to Vine Road with a separated multiuse pathway on the north side and 4-foot inside shoulders and 8-foot outside shoulders. In order to improve safety and reduce congestion, breaks in the median have been proposed for every half-mile to mile. Transition areas will expand the road north of Centaur Avenue and south of Vine Road in order to match the existing roadway.
According to White, the purpose of this project is to improve mobility for people and freight and to enhance access management along Knik-Goose Bay Road.
“It will add capacity and correct problems created by unconstrained access, thereby improving safety and reducing congestion for roadway users,” he says, adding that the roadway will be designed to accommodate both current needs and future capacity improvements. The project is estimated to cost $100 million to $120 million.
Seward Highway MP 75-90 Road and Bridge Rehabilitation project, April 2019.
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Routine Maintenance Delayed
While these projects are underway, it is likely that the routine maintenance of public buildings, which is completely state-funded, will not fare as well. According to the state’s Office of Management and Budget, the state already has a backlog of $2 billion in deferred maintenance, which is growing by $150 million to $400 million annually.
The University of Alaska, which is the largest landlord in state government, may be especially hard hit as it owns and maintains more than 420 buildings, totaling 8.2 million gross square feet, with an adjusted value of nearly $4 billion.
According to the university’s Office of Government Relations, university-owned facilities are some of the oldest buildings in the state with an average age of thirty-three years and a facilities maintenance backlog approaching $1.1 billion. The university currently uses internal operating funds to partially mitigate the risks of delayed facilities maintenance, spending approximately $35 million annually, compared to the $60 million it estimates it requires.
While the university has historically looked to the legislature to provide annual capital funding for building upkeep, as a result of the new state budget, the University of Alaska will see a $25 million cut in funding for this budget year, which began July 1. The next two years will see cuts of $25 million and $20 million, for a total of $70 million.
Charlie Bohart, PE, stands in the sunset glow next to Pacific Asphalt’s striping truck and personnel.
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The Corporate 100
Alaska Business has been celebrating the corporations that have a significant impact on Alaska’s economy since 1993. At the time, the corporations weren’t ranked as the list didn’t have specific ranking criteria. Instead, the Alaska Business editorial team held long, detailed, and occasionally passionate discussions about which organizations around the state were providing jobs, owned or leased property, used local vendors, demonstrated a high level of community engagement, and in general enriched Alaska.