It took six years, but in 2013, the Utah State Courts finally got the state legislature to approve a budget for the $34.2 million 2nd District Juvenile Courthouse, in Ogden. When it opens this May, the 85,000-sf, five-story building will include eight courtrooms, offices for judges and their 50-member staff, and space for juvenile probation services and the Weber County Sheriff’s security staff.
Projects like the Utah courthouse are luxuries for many states that, despite improving economies, are struggling to keep their heads above water.
Since the second half of 2013, state tax collections have fluctuated. They were down in the first half of 2014, then rebounded by 4.4% in the third quarter of 2014 over the same period a year earlier, according to the Rockefeller Institute of Government. The institute expects continued revenue growth in the coming quarters, but state tax collections have failed to keep pace with expenditures, especially as more states expand Medicaid coverage under the Affordable Care Act.
At least 16 states are facing serious budget shortfalls, according to the Washington Post. These include Louisiana, which is looking at a $1.6 billion deficit, which ballooned by $400 million as the price of oil—a huge source of state revenue—fell by 50%. Other states with impending deficits include Virginia ($2.4 billion), Pennsylvania ($1.8 billion), Kansas ($1 billion through FY 2016), Alabama ($950 million), and Maryland ($900 million).
The National Association of State Budget Officers (NASBO) notes that all states but Vermont either require their governors to submit or sign a balanced budget, or their legislatures to pass a balance budget. With tax increases mostly off the table, achieving balance means spending cuts. Recent data offer inconclusive clues as to the impact of those cuts on future state-funded construction and renovation work.
One snapshot—NASBO’s “State Expenditure Report 2012-2014”—projected a 5.5% increase, to $17.4 billion, in the states’ capital expenditures in fiscal 2014 for projects in an “all other” category that includes stadiums, public schools, and healthcare.
The Census Bureau’s broader estimates for public state and local construction put in place were less robust. Last year that number stood at $251.5 billion, up 2.2% from 2013, but still the second-lowest spending year since 2006.
Big-ticket categories were Roads and Bridges, Education, Transportation, and Sewage and Waste Disposal. Amusements and Recreation (which include sports stadiums) jumped 7.7% to $8.7 billion. Office construction was up 3.6% to $5.4 billion; Public Safety projects (jails, firehouses, etc.) fell by 7.9%, to $6.1 billion. Healthcare declined by 10.5%, to $6.3 billion.
Jan Frew, Deputy Administrator for Idaho’s Public Works division, reached out to several of her counterparts in the National Association of State Facilities Administrators on behalf of BD+C. Most of those contacted reported slight increases in tax revenues but only modest state-funded construction activities, she says.
Frew says that, since 2011, Idaho’s appropriations for public works have been “fairly steady,” at around $22.5 million per year. But while appropriations have recently spiked to $36 million, lawmakers aren’t confident that tax revenues will keep growing and are being cautious about adding to the state’s project funding base. Frew says the state is also reluctant to use bonds to fund projects.
Other states are looking for new ways to lower their construction costs. Illinois, Indiana, South Carolina, and West Virginia are among the states debating whether to repeal prevailing wage laws that apply to government-funded projects.
Newly elected Hawaii Governor David Ige, a Democrat, proclaimed that his state would actively seek more federal dollars to help fund state projects for housing, water, and transportation.
On the other hand, a can-do spirit is evident in Maine, where Governor Paul LePage, a Republican, recently unveiled a three-year, $2 billion, 1,900-project public works plan that, in 2015 alone, would include safety improvement projects at 76 locations, and $4 million for improvements at Portland’s International Marine Terminal.
In Michigan, the first stages of a new $88 million Welcome Center and park for the State Capitol have been initiated, even though the project’s funding mechanism isn’t in place. John Truscott, a spokesman for the Michigan State Capitol Commission, says the early work is being paid for through a $3 million allocation established last year for Capitol renovation and upkeep. The commission is seeking bond financing for the Welcome Center that would be repaid with tobacco taxes.
Related Stories
| Sep 4, 2014
Ranked: Top courthouse sector AEC firms [2014 Giants 300 Report]
Fentress Architects, Tutor Perini, and AECOM top BD+C's rankings of design and construction firms with the most revenue from courthouse facilities, as reported in the 2014 Giants 300 Report.
| Sep 3, 2014
Ranked: Top local government sector AEC firms [2014 Giants 300 Report]
STV, HOK, and Turner top BD+C's rankings of the nation's largest local government design and construction firms, as reported in the 2014 Giants 300 Report.
| Sep 3, 2014
New designation launched to streamline LEED review process
The LEED Proven Provider designation is designed to minimize the need for additional work during the project review process.
| Sep 2, 2014
Ranked: Top green building sector AEC firms [2014 Giants 300 Report]
AECOM, Gensler, and Turner top BD+C's rankings of the nation's largest green design and construction firms.
Sponsored | | Aug 8, 2014
Safe and secure: Fire and security glazing solution for Plaquemines Parish Detention Center
When the designers at L. R. Kimball looked for an all-in-one clear, wire-free glazing solution that protects against fire, bullets and forced entry for the new Plaquemines Parish Detention Center, SAFTI FIRST supplied a complete single-source tested and listed assembly that was easy to install and maintenance-free.
| Aug 6, 2014
25 projects win awards for design-build excellence
The 2014 Design-Build Project/Team Awards showcase design-build best practices and celebrate the achievements of owners and design-build teams in nine categories across the spectrum of horizontal and vertical construction.
| Jul 28, 2014
Reconstruction market benefits from improving economy, new technology [2014 Giants 300 Report]
Following years of fairly lackluster demand for commercial property remodeling, reconstruction revenue is improving, according to the 2014 Giants 300 report.
| Jul 28, 2014
Reconstruction Sector Construction Firms [2014 Giants 300 Report]
Structure Tone, Turner, and Gilbane top Building Design+Construction's 2014 ranking of the largest reconstruction contractor and construction management firms in the U.S.
| Jul 28, 2014
Reconstruction Sector Engineering Firms [2014 Giants 300 Report]
Jacobs, URS, and Wiss, Janney, Elstner top Building Design+Construction's 2014 ranking of the largest reconstruction engineering and engineering/architecture firms in the U.S.
| Jul 28, 2014
Reconstruction Sector Architecture Firms [2014 Giants 300 Report]
Stantec, HDR, and HOK top Building Design+Construction's 2014 ranking of the largest reconstruction architecture and architecture/engineering firms in the U.S.