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ARTBA Predicts 2017 Transportation Growth

Friday, December 9, 2016

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A new report from the American Road & Transportation Builders Association predicts some growth in the transportation construction market in 2017, fueled by both increased highway work and more private road construction related to new development.

ARTBA’s 2017 U.S. Transportation Construction Market Forecast predicts that the market will total $247.8 billion next year, an increase of more than $3 billion over 2016 numbers. The bridge and tunnel segment of the market, though, is expected to dip slightly from record numbers in 2016.

Road work
© iStock.com / catnap72

The report notes that voters in 24 states approved ballot measures in 2016 that aim to help fund transportation work, via increased gas taxes, user fees and local funding initiatives.

That total value takes into account all manner of public and private transportation construction: highways, bridges, public transit, airports, rail, ports and waterways, in addition to private streets and parking lots. Maintenance and right-of-way purchases are also taken into account.

Federal Funding

The market forecast, authored by ARTBA chief economist Dr. Allison Premo Black, notes that the Fixing America’s Surface Transportation Act, passed in late 2015, helped bolster highway spending to an extent in 2016, though many states were slow to put the funds to work.

ARTBA

ARTBA’s 2017 U.S. Transportation Construction Market Forecast predicts that the market will total $247.8 billion next year, an increase of more than $3 billion over 2016 numbers.

Additionally, a “continuing resolution” recently introduced in Congress to stave off a possible government shutdown is expected to hold discretionary spending at current levels until at least the end of March, the report notes. This would mean that anticipated increases in FAST Act funding ($900 million) and public transportation funding (upwards of $500 million) would be delayed until at least April, though current funding would remain in place.

Bridge Work, State Budgeting

Bridge and tunnel construction jumped to a record high $33.3 billion in 2016, the forecast notes, fueled by a number of major projects that started in late 2015. The market forecast predicts that the sector won’t be able to sustain that level, but will still deliver healthy numbers, at $32.9 billion.

Road and street work done by state and local governments declined slightly in value from 2015 to 2016, and ARTBA anticipates another slight dip in 2017, forecasting a one percent drop in that sector. However, the report notes, voters in 24 states approved ballot measures in 2016 that aim to help fund transportation work, via increased gas taxes, user fees, and local funding initiatives.

Public Transit, Private Development Drive Growth

Rail and public transit is a bright spot in ARTBA’s 2017 forecast; the group predicts growth of five percent in that sector, from $19.3 billion in 2016 to $20.3 billion. Subway and light rail spending will increase to near-record levels, at about $7.7 billion, the group predicts. Some of the growth in public transit spending comes from increases created by the FAST Act.

Bridge construction
© iStock.com / Viktorcvetkovic

Bridge and tunnel construction jumped to a record high $33.3 billion in 2016, the forecast notes, fueled by a number of major project that started in late 2015.

The construction of new developments will drive a considerable increase in spending on private streets, bridges, driveways and parking lots, the forecast says. That industry did $58.9 billion in business is 2016, and ARTBA predicts a jump of more than $3 billion, to $62.5 billion next year.

Trump Effect Downplayed

The ARTBA report does not specifically address the infrastructure investments anticipated under the incoming Trump administration, which may not take effect during the 2017 fiscal year.

Others, such as financial analyst firm Fitch Ratings, which issued its own transportation infrastructure forecast Monday (Dec. 5), have noted that the industry faces uncertainty due to unknowns related to the President-elect’s plans and Congressional reaction.

   

Tagged categories: Business matters; Funding; Government; Infrastructure; Market forecasts; Market trends; North America; Program/Project Management; Roads/Highways

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