In response to state threat, St. Louis agency offers $10 million to speed up road projects (2024)

ST. LOUIS — The region’s transportation planning arm is offering to kick in up to $10 million more on local road projects, hoping to ward off a threat from the Missouri Department of Transportation to claw back federal dollars that aren’t spent fast enough.

Board members of the East-West Gateway Council of Governments on Wednesday approved setting aside $10 million to help local governments respond to “inflationary issues” by plugging holes, capped at $1 million, in their project budgets. Rising costs for everything from labor to asphalt have delayed local projects, which rely on federal dollars passed through MoDOT and East-West Gateway.

But MoDOT has warned the council and similar bodies in the state’s other cities to either obligate federal dollars more quickly or the state would take the money back and use it on its own road projects. In January, MoDOT told regional transportation authorities like East-West Gateway, which administers about $90 million in annual federal road money passed through MoDOT, that they must obligate at least 110% of their yearly federal transportation allocation to local projects or risk losing the difference.

“This eliminates the risk of losing money,” East-West Gateway Executive Director Jim Wild said of the new $10 million pool.

Wild’s staff hopes the extra pot of money can help area governments pull their road projects together on time and fill any shortfalls in local matching funds or other sources so that construction can move forward.

“There are a couple projects that we’re pretty sure they can move ahead, but you just never know what can happen,” Wild said in an interview. “This helps give us kind of a little leeway making sure we hit those (MoDOT) trigger points and those targets.”

MoDOT has signaled its concern for years about the growing unobligated transportation funding balances administered by the state’s urban transportation planning agencies. In St. Louis, East-West Gateway and local governments blame the backlog on pandemic-related issues that blew up budgets, affected staffing at agencies and professional service firms and slowed access to courts needed for right-of-way acquisition.

While all of the federal money the region gets is earmarked for local projects, local governments must complete engineering and construction plans and acquire right-of-way, among other tasks, before the feds agree to release the money and it is considered “obligated” by the state.

Meanwhile, the bipartisan infrastructure bill has pumped more money into the program, giving area governments a larger annual chunk of money even as they try to spend down the dollars from prior years.

East-West Gateway argues it has reduced the unobligated balance of federal dollars by some $20 million since 2022 to $64 million last year. But MoDOT wants to maximize its total take of federal dollars for the state, and too many unused dollars at the local level can impact the amount a state gets from the U.S. Department of Transportation. Every federal dollar matters as MoDOT gears up for the $2.8 billion expansion of Interstate 70 across the state.

Still, MoDOT’s move has caused some local friction. East-West Gateway staff used uncharacteristically strong language in a staff memo earlier this year to signal it was “extremely disappointed and displeased“ with MoDOT’s new policy. Even so, Wild nonetheless expressed confidence last month the region would spend well above the 110%, or $99 million, trigger set by MoDOT.

But in a memo to its board Wednesday, East-West Gateway staff said potential delayed projects meant the region could obligate just $98 million of its funding this year, slightly below the trigger point.

Wild said the $98 million estimate is very conservative and assumes just about everything goes wrong.

“Any chance a project can stumble and not move ahead we tagged that and took it off our what we can do,” he said.

And East-West Gateway doesn’t want to take any chances of losing out on local road funds, hence the $10 million pool. The money is left over from under-budget projects and unspent funds earmarked for projects several years away. Using it now does pose a small risk to future road projects, but Wild said it is minimal and more important right now to maximize dollars available locally.

“It’s money that could reduce the number of projects we do in the future,” Wild said. “It’s not a high probability, but it is a probability.”