Looming Government Shutdown to Have Limited Impact on Highway Program, Other Transportation Program Impacts Likely

 The outlook for Congress to pass a Continuing Resolution (CR) to keep the government operating past Sept. 30, 2013 remains uncertain as House and Senate Republicans continue to disagree on including a provision in the CR to defund Obamacare. A CR is necessary because Congress failed to enact any of the twelve appropriations bills that annually are necessary to fund government functions. While the transportation appropriations bill is included in this group, the impact on the Federal-aid highway program will be minimal. Because the Federal Highway Administration (FHWA) is funded out of the Highway Trust Fund, and since MAP-21 authorized funding through the end of FY 2014 (September 30, 2014), FHWA will not be shut down. There will also be no impact on on-going contracts or on state bid lettings because MAP-21’s contract authority allows states to obligate funds through the end of FY-2014. States will also be reimbursed for payments for ongoing work. (The situation is of course reversed at the end of FY 2014 if MAP-21 is not reauthorized, FHWA would shut down and states would not be able to obligate funds for any new contracts.) The Federal Transit Administration (FTA) is not funded from the HTF and therefore would be shut down. On-going construction funded under a full funding grant agreement is subject to annual appropriations and therefore the local transit agency would have to pay invoices out of its own budget with the expectation of being reimbursed by FTA in the future. The Federal Aviation Administration (FAA) is also not funded out of a trust fund, however, the Airport Improvement Program (AIP) is. Ongoing construction work funded through AIP should not be impacted, although reimbursements to airport authorities could be delayed.