Roadbuilding State of the Industry

By Rod Dickens

With 2010 fading quickly, concrete contractors and producers have to wonder what's in store for 2011. The ARRA stimulus package was a step in the right direction this year, but did its impact meet expectations and will the projects it "stimulated" set the tone for next year, or will a stalled highway bill and questions about the future of the Highway Trust Fund dictate near-term industry prospects. These are among the questions Concrete Contractor posed to industry experts. Here's what they had to say about 2010 and where the industry is heading next year:

ARRA stimulus impact

Concrete Contractor (CC): What impact did the American Recovery & Reinvestment Act (AARA) have on highway contractors and concrete producers in 2010? Did it meet, exceed, or disappoint your expectations?

Ed Sullivan, Chief Economist for Portland Cement Association (PCA): "Ultimately, we are very disappointed in where the funds went. Introduced as an infrastructure bill, in actuality very little went into infrastructure. Major infrastructure construction takes time to get into the marketplace, hence most of the money was used to repair existing roads.

"Over the next 25 years, there will be a projected 50 million more drivers on the highways. If we don't invest more in new highway construction, drivers will experience horrendous traffic jams in cities, which ultimately will hinder our country's economic growth."

Kerri Leininger, Vice President of Government and Political Affairs, National Ready Mixed Concrete Association (NRMCA.): "Once the final amount for infrastructure projects included in ARRA was released ($81 billion for infrastructure) unfortunately the industry immediately knew it was far too low to have much of an impact to turn around the industry's declining numbers. Especially since the $81 billion was divided among highways and bridges ($29 billion), transit and rail ($16.4 billion), water projects ($18 billion), and buildings ($18.5 billion).

"The majority of the projects that would be, and have been, funded since ARRA's passage were considered "shovel-ready," which translates mainly to asphalt overlays, filling potholes, and for water infrastructure, re-cementing sewer systems. By design, the ARRA pushed states toward focusing on simple maintenance - which can be completed much faster than proper upgrades or new construction. And many of the physical projects have been plagued by permitting problems and delays in ARRA payouts."

According to NRMCA, "Although the ready mixed concrete industry has seen some of the ARRA money, by and large the notion that all our nation's highways, bridges, and tunnels would be repaired and rebuilt using ARRA money couldn't be further from the truth, leaving the RMC industry rather disappointed with the outcome of the stimulus. In the end, passage of the ARRA - with a large percentage of the funding going toward infrastructure - ultimately took the pressure off Congress to pass meaningful transportation reform legislation."

Leif Wathne, P.E., Vice President of Highways and Federal Affairs for the American Concrete Pavement Association (ACPA): As a starting point, the concrete pavement industry welcomed the American Recovery and Reinvestment Act (ARRA). In terms of the actual program, however, it had mixed results for the concrete pavement industry. There were some highway, roadway, and airport pavement construction projects started and completed quickly and efficiently. But we simply need to do more to improve the capacity and conditions of our nation's surface transportation infrastructure.

"There are three critical issues that are hanging in the balance: