13 minute read
Infrastructure
by LABI_Biz
Lambert Media
COVER STORY
The future of...
INFRASTRUCTURE
With two new sources of funding, will Louisiana finally bring transportation up to speed?
BY MARIE CENTANNI
In Calcasieu Parish, thousands of workers drive to and from a cluster of major industrial facilities on their daily commutes, largely relying on the I-10 Calcasieu River Bridge or the I-210 loop to get them where they need to go—preferably, on time. But that’s a daily gamble, with big potential impact. Traffic delays caused by accidents on the steep, narrow and obsolete bridge are all to frequent, and almost predictable— especially when it rains.
“The unpredictability of the bridge shutdowns and traffic backups impacts the entire organization,” says Megan Hartman, public relations director at Phillips 66’s Lake Charles complex, home to 775 fulltime workers and around 350 contract workers. “Overtime incurred on shift changes when the relief isn’t able to get to work on time, parents being unable to pick up children from school on time, and overall loss of productivity can be impactful.”
From an economic development standpoint, the industrial investment in the area is historic. Tens of billions of dollars have been invested in these facilities, and the region is benefitting from a workforce boom and growth in economic opportunity. But local infrastructure struggles to keep up with that growth, including the interstate— which, local manufacturing plants aside—is a major national artery for moving goods and people. As Louisiana’s transportation chief says, Calcasieu’s bottlenecks are the nation’s bottlenecks.
“Replacing the Calcasieu River Bridge is going to provide certainty for decades and for generations,” says Shawn Wilson, secretary of the Louisiana Department of Transportation and Development (DOTD), “recognizing that I-10 is the freight corridor for the country.”
It’s a weighty distinction that comes with a certain responsibility for continued investment, amplified further by the series of hurricanes that have hit coastal Louisiana at both ends; Louisiana has always been one of the most logistically advantageous states in the nation, starting not with roads, but with water.
“Thomas Jefferson recognized the importance of the Mississippi River, which is why he pushed the Louisiana Purchase,” says U.S. Rep. Garret Graves (R-Baton Rouge). “Thirty-one states are connected to the river. It’s an economic goldmine, and it’s right here.”
And that trade foundation has, over the state’s history, spurred a network of multimodal methods of transporting goods and people, from water to rail to roads and air. It’s what landed the investment in places like southwest Louisiana, creating the
Running across the entire state, I-10 creates traffic bottlenecks in Baton Rouge and Lake Charles due to outdated infrastructure.
U.S. Rep. Garret Graves (R-Baton Rouge) Secretary Shawn Wilson, DOTD Rep. Tanner Magee (R-Houma)
current boom. Graves is quick to point out the multimodal stats that make Louisiana stand out: the state is home to five of the top 15 ports in terms of tonnage, has more water-based commerce than any other state and is one of only two places in the country with six Class 1 railroads. But he says we have major infrastructure challenges to solve in order to protect investment and lure even more.
“We can’t possibly sit here and tell major corporations to build here or relocate here if we don’t address our flooding, our traffic problems and our resiliency issues,” says Graves. “We won’t be competitive.”
But two new pools of funding for Louisiana’s infrastructure could fuel increased investment in tackling our to-do list of projects and allow us to truly modernize our assets: around $150 million per year from the state vehicle sales tax retool passed by the legislature in 2021, and roughly $1 billion from the federal Infrastructure Investments and Jobs Act (IIJA), signed into law in November. Together, they represent the first significant funding source for infrastructure in decades, investment that could increase based on economic triggers in the state bill and potential for more funding on the federal side. That has Louisiana’s transportation secretary more than excited.
“What I’m most excited about is the $350 million new dollars per year that we’re going to see over the next five years,” says Wilson. “I say that because it will allow us to do two things: to take better care of what’s already built and to start moving forward on projects that we’ve talked about and wanted for years.”
Dedicating a new funding stream at the Louisiana Legislature without raising taxes to achieve it was no small feat, and is the result of tenacity, collaboration and creativity from a group of legislators and stakeholders. Bill author Speaker Pro Temp. Tanner Magee (R-Houma) is quick to point out HB 514 didn’t even start out as a road funding bill, it was a proposed tax on marijuana.
“One of the biggest challenges any time
you’re passing legislation dealing with taxes and revenue is getting it out of the House. Seventy votes is really difficult,” says Magee. “I had already moved my marijuana tax bill off the floor—it was a marijuana tax bill really just in title. It truly was a general sales tax bill. I ran it early to see what happened, and I got it across to the Senate. There were other infrastructure funding measures out there, but the thought was those may never come over to the House, so let’s hold your bill in the Senate and we can try to play with it if nothing else gets to us in the House. And that’s what happened.”
And it happened, says LABI Chairman Terry Baugh, because so many legislators had been working for months together on a number of infrastructure funding solutions. And those legislators—some with competing approaches—joined together in support of this compromise when the opportunity arose.
“What the final few days were,” says Baugh, “was just the culmination of legislators working hard trying to go down this trail, then that trail and another trail, and they finally found the trail to the finish line.”
Baugh, who serves as CFO of D & J Construction Company in northeast Louisiana, which primarily builds rural road projects with a workforce of 150, says the final bill language represented the most bipartisan and broadly supported option, as evidenced by the 37-0 vote in the Senate and 88-13 tally in the House. “Solid, veto-proof margins,” he points out. The idea was to shift a portion of state tax proceeds from motor vehicle sales and leases to the Construction Subfund of the Transportation Trust Fund. Starting with FY 2023-24, 30% of the tax revenue will be deposited in the subfund, and each fiscal year thereafter, 60% of the revenue will be deposited. Eventually, $300 million will go into the subfund every year, 75% of which must be used for specified major road and bridge construction projects, with the remainder going to highway and bridge preservation projects. “Through this process, there’s a momentum that builds,” says Magee. “But the governor didn’t immediately express an intention to sign it. In fact, he expressed an intention to not sign it. The governor’s concern was that it was going to cause a fiscal
U.S. Rep. Garret Graves
Collin Richie
COVER STORY
The I-49 Lafayette Connector will ultimately extend 1-49 from 1-10 (seen here) to the Lafayette Regional Airport.
cliff this next year, but now we’re sitting on $700 million worth of surplus, so those fears weren’t warranted.”
In fact, Magee says, the new dedicated state revenue is well-timed, providing a steady stream of state matching funds to secure federal dollars. And he says it removes the red tape that has come with the piecemeal patchwork of federal funds we’ve secured over the years in single doses–red tape that slows down even small projects. “It slows everything down because you have to use federal guidelines,” explains Magee, “and when you’re not, you can just build the stuff. So, if you want to do a smaller bridge project, and you have state dollars, we can just do it and not have to go through the exhausting federal process. This could really speed up projects and inspire confidence in the public that has become very cynical in how long it takes to build a bridge.”
And now Louisiana can finally look to taking on projects like replacing the Calcasieu River Bridge, building a new Mississippi River Bridge in Baton Rouge, building the I-49 Connector through Lafayette, addressing the Jimmie Davis Bridge, passenger rail along I-10 and I-20 and more. But Wilson cautions that the influx of funding won’t mean an instant, statewide construction zone. It all has to be carefully implemented.
“The projects all have varying timelines and starting points,” he says. “It’s not physically possible to start them all simultaneously. We don’t have the workforce and materials to deliver it, and even when you do have that, you run into inflation and the cost greatly increases. Those are things we know are going to be an issue. The most important thing, though, is that these will be phased, so you have to offer a phase that offers utility and value to citizens as it stands before you move on to the next.”
Wilson points to the I-49 Connector as an example, a five-mile corridor running through the urban center of Lafayette, the Hub City. “I can’t do that all at once, so we’ve got to work in sections while we acquire property and relocate utilities.” But once underway, he says, the statewide construction activity will have a major impact not just on our mobility, but on our economy “When we listen to the needs of our state, we can deliver results that benefit all without raising taxes on American families. The bipartisan infrastructure bill will rebuild our roads and bridges, increase access to high-speed internet, strengthen our electric grid, add levee protection, and improve flood resiliency. We have already seen significant funding come to our state due to this legislation, and there is more on its way.”
—U.S. Sen. Bill Cassidy (R-Baton Rouge)
Stay tuned for an upcoming LABI podcast on the infrastructure bill with Sen. Bill Cassidy and others.
The Mississippi River is one of Louisiana’s greatest economic highways, and rails, roads and bridges require continued investment to take advantage of this economy for decades to come.
as well, with 13,000 direct and indirect jobs created for every $1 billion spent on road construction.
Employers in the road building business can’t wait.
“It’s an absolute game changer that Louisiana was able to get the first dedicated transportation revenue increase since 1989,” says Bryan Jones, vice president and Gulf Coast office leader for HNTB, a Kansas Citybased infrastructure solutions firm with a 70-year presence in Louisiana that began with designing the I-10 Atchafalaya Basin Bridge. More recently, they’ve done design work on the elevated LA-1 highway to Port Fourchon, and environmental work on the I-49 Connector and Calcasieu Bridge. They even designed the LSU Football operations center and locker room.
“It’s monumental for Louisiana,” says Jones, “and will provide a sizeable increase in funding for the next several years. But we’re only going to be successful if we can do our part and demonstrate our ability to match local dollars to available federal funds. There’s a significant increase in formula funds, but the real sweetener of the federal infrastructure bill is the tens of billions in discretionary grant opportunities for infrastructure that Louisiana and communities statewide will be able to compete for across a variety of infrastructure programs.”
But Graves is cautious about the federal funds and the political strings attached and says Louisiana simply won’t demonstrate the policy priorities the Biden administration will require to qualify for the discretionary portion, which as this magazine goes to print have been hinted at, but not formalized. “Louisiana is not going to get its fair share,” he says, of predicted funding requirements like climate change, environmental justice and enhancing union opportunities.
“All money is not good money, and I get that,” concedes Wilson. But he says there’s reason to be hopeful regardless of the Biden Administration’s policy push. “I think there is something to be said for formula programs and discretionary programs. Historically every administration has focused on their policy priorities using discretionary funding. They incentivize you with the carrot as opposed to the stick. On the formula side, they’ve given states the flexibility to invest those dollars because states should get their fair share. We can do better by formula versus discretionary because discretionary is not necessarily equitable.”
Wilson says the bill sets aside only $150 billion in the discretionary pot, but $350 billion in the more predictable formula funding. “At the end of the day, we’re getting $1 billion more than we have before, whether we invest in rail or anything like that. So, we aren’t having to demonstrate union jobs. That’s $1 billion more over five years, in formula funds alone.”
Meanwhile, Graves is holding out for newer, innovative funding mechanisms for long-term investment, particularly to address our coastal and flooding issues as well as synchronizing various modes of transportation. “Ultimately, to get where we need to be, we need a comingling of sources,” says the congressman. “We must address the sins of the past with significant financial investments. Some of the things we’ve avoided in the past because they were expensive have to be hit head-on. They must be our top priorities. We can’t afford not to.”
MAXWELL AFB
FORT GORDON
ENGLAND AIR PARK MISSISSIPPI ALABAMA
Atlanta
30
CAMP BEAUREGARD
Shreveport
20
Jackson
U.S. 59 LOUISIANA
Lufkin
Huntsville Woodville
Leesville
Jasper
Livingston
Bryan/ College Station
U.S. 69
Lumberton
Houston
U.S. 96
10
Port of Beaumont
69
Port of Port Arthur
Natchez
Alexandria
Pineville
49
Baton Rouge
FORT POLK
Brookhaven
U.S. 84
55
New Orleans Birmingham
Meridian
20
Selma
Wrens 85 Macon ColumbusPhenix
City
Demopolis
59
Laurel
Hattiesburg
U.S. 49
U.S. 80
Montgomery
65
10 75
FORT BENNING
Port of Gulfport
FORT RUCKER
CAMP SHELBY KEESLER AFB
20 Augusta
16 95
GEORGIA
Port of Savannah
ROBINS AFB
FORT STEWART
Coastal Re ning, LNG, Petrochemical, Metal Processing Hubs
CORPUS CHRISTI ARMY DEPOT
For two decades, a coalition from Texas to Georgia has been building support for a “Forts-to-Ports” strategic corridor that would run right through central LouI-14: Another Interstate on the Horizon? Five-State Congressionally Designated Interstate 14 Corridor Texas to Georgia Forts-to-Ports Connectivity Corridor isiana. On November 15, 2021, they inched a bit further down the road to reality, when the president signed the $1.2 trillion Infrastructure Investment and Jobs Act (IIJA), authorizing congressional designation of I-14, creating four new High Priority Corridors and expanding the existing I-14 Corridor in Texas. In Louisiana, the congressionally-designated route runs from LA Highway 8 at the Sabine River Bridge at Burrs www.GulfCoastStrategicHighway.org For Info Contact: Don Rodman, Communications/Administration - 361-877-0409 - don@therodmanco.com Larry Meyers, Washington Representative - 202-484-2773 - LMeyers@hslawmail.com Crossing, heads east near Alexandria and Pineville, and follows US 84 to the Mississippi River at Vidalia. The I-14 idea began as a way to better connect Fort Polk, Fort Hood and Fort Bliss to the designated Strategic Military Deployment Ports on the Texas Coast, providing invaluable capability to move military assets and cement the viability of those bases. While no funding for the interstate is included in the IIJA, this designation opens the door for future investment in a critical corridor that could not only serve our military but bring economic development to Louisiana’s midland.
