No "Hoarding" Here!

I continue to be amazed at comments made by members of the Florida House of Representatives when talking about the Florida Department of Transportation (FDOT) and the State Transportation Trust Fund (STTF).

This Tuesday, the House Transportation and Economic Development Appropriations Committee listened as speaker after speaker spoke in opposition to the sweeping of the STTF. Amazingly, after 2 hours of public testimony, no one spoke in favor of the sweep. The bill passed in a strict party-line vote with ten Republicans voting for the sweep and five Democrats voting against it. Even the legislators who voted for the sweep could offer nothing more than comments such as “I don’t want to do this...”, “We know this impacts jobs…” and others of a similar nature.

There continues to be a lot of confusion regarding the impact of the sweep but at least no one is denying that projects will have to be deferred. From that point on, however, accounts of the impact start to vary.

Here are several observations that I feel very comfortable stating as we look forward:

1. No Hoarding Here. If FDOT were “hoarding money” FTBA would be the first group to scream foul. We desperately need work and would not sit idly by if FDOT were stashing away money and not programming work in a financially responsible manner.

2. This Money will be Gone for Good. Once these transportation funds are swept, you can bet they won’t be paid back later. Projects will not be built. Look at it this way – if you lose your job and are out of work for a year, would you ever be able to make up the money you lost? The answer is a cold, hard no.

3. Let FDOT Manage Their Funds. The Department of Transportation manages cash as well or better than any government agency I know. After being burnt badly in 1989 by over committing on work, FDOT has made cash management a top priority. The massive sweep being proposed by the House would grind new construction projects to a halt. As a matter of fact - I would not be surprised to see FDOT cancel bid lettings until the final budget is approved.

4. FDOT Cash Will Fall Like a Rock. No matter what happens, the cuts already absorbed by FDOT means almost no capacity projects will be built in the foreseeable future. If this sweep holds up, FDOT cash will fall like a rock. There is no way they could bid new work. Their efforts will only focus on keeping current projects moving forward.

5. Roll Forward” does not = FDOT Cash. There have been mentions of $700-800 million of “roll-forward” funds in the FDOT budget. Unfortunately, the term “roll forward” only refers to budget authority – not cash. Whether it is federal earmarks, ROW acquisition, or preliminary project engineering, there is no actual cash. In simpler terms FDOT does not have an extra “stash of cash” somewhere. FDOT’s bank balance is their cash. The roll forward does not add one dime to the cash.

6. Federal Highway Dollars May be Lost. FDOT ‘s ability to front money on major projects, prior to receiving federal dollars for those projects, will further hamper Florida’s ability to begin any major transportation projects. In fact, for the first time ever, FDOT might be in a position toward the end of the budget year to lose federal highway dollars to other states. That’s no way to improve our federal rate of return.

7. House Position Puts Congressional Delegation in a Pickle. Our Congressional delegation will find it difficult to be motivated to help with transportation federal dollars given the Florida House position.

8. Financial Practices should be Uniform. Florida would be much better off if the financial practices put in place at FDOT were used throughout our local, state and federal governments. Again, as mentioned in point one, there is no “hoarding” at FDOT.

A lot of questions remain as the overall House Appropriations Committee prepares to meet next Tuesday. One thing is for sure however, the sweep will impact Florida’s ability to jump back into economic prosperity. Cutting jobs – thousands upon thousands of jobs – cannot be the answer.