Ms. Gramian fielded numerous questions pertaining to the fiscal challenges facing the department and the highway construction and design programs. Some items of note were:
- The Motor License Fund (MLF) is anticipated to have an $800 million shortfall by year’s end. (We reported to you earlier – go HERE for more in-depth summary. )
- The shortfall in the MLF will translate to an approximate $1.8 to $1.9 billion letting program in 2020 AND PennDOT originally projected a $2.2 billion letting program for 2020.
- In response to questions asked by Committee Chairwoman Kim Ward, the secretary reported that the department will have some cash flow problems for the remainder of the fiscal year (through June 30, 2020) and that payments to contractors may be delayed.
- The secretary also addressed the canceled contracts and eliminated projects from the future letting schedule. She indicated that the department is re-evaluating its programs on the construction side and is also looking to “revamp” its maintenance strategy by reducing the number of resurfacing projects and replacing them with lower level treatments.
While much of the questioning was directed to PennDOT, the PA Turnpike was asked about its construction program. CEO Mark Compton reported that the COVID-19 crisis could cost the Turnpike between $400 and $500 million. Additionally, Compton testified that the commission is going to cut its capital program by about 25% but will not stop any projects that are currently underway or in the process of starting.
If you missed the hearing, you can view it in its entirely on the committee’s website by going here.
Local v. State. The halls of the capitol continue to remain contentious. The Senate again approved legislation that would give county governments a greater say in the re-opening of businesses and removal of certain restrictions. That bill (SB 327), however, is not likely to gain approval of Governor Wolf.
The Governor has been steadfast in his position that the administration’s metrics will drive the re-opening process for counties. Gov. Wolf did move 24 counties to “yellow status” and has directed that another 13 can move to yellow at the end of the week. To see a list of these counties, go here.
Some counties have announced plans to defy the governor’s orders and reopen on their own. But, in recent days counties such as Cumberland and Dauphin have pulled back on those plans. The battle, however, continues but has little effect on the industry as a whole because the governor deemed it as life sustaining and allowed for the resumption of highway constructions activities effective May 1.
Yes, the House is in session too…We don’t want to forget about our friends in the PA House of Representatives. They, too, have taken legislative action aimed at reopening portions of the state’s economy.
In actions yesterday, a bill sponsored by Rep. Garth Everett (R-Lycoming County) passed in committee allowing a limited level of service at Pennsylvania restaurants. The plan allows restaurants in “yellow phase” counties to resume dine-in service but would be limited to 50 percent of their regular seating capacity. Currently all dine-in services must remain closed under the governor’s existing order even in the yellow phase. It is unknown if the governor supports this bill, but it’s unlikely given his opposition to other attempts to circumvent the orders in place.
The House and Senate are slated to return next week where a more serious discussion is poised to occur regarding the passage of a short-term budget for the Commonwealth.
