DOTD tells joint committee $285 million LTIF remains on track; $130 million obligated so far

The Department of Transportation and Development told the joint House and Senate Transportation Committee that the $285,000,000 LTIF appropriation from last year remains on schedule and that $130,000,000 of those funds have been obligated to projects so far.

In opening remarks on the LTIF review, Secretary Donahue said the LTIF portfolio was assembled with leadership from the House speaker, Senate president and the governor and was focused on preservation projects that could be delivered within the current fiscal year. The department presented a slide package that breaks the portfolio into projects already let, projects anticipated to be let in quarters 3 and 4, two change orders and three small preconstruction allocations.

"Two thirds of the projects have been let," Barry Keeling, deputy secretary, told the committee and later added, "we've obligated a hundred and $30,000,000 of the LTIF funds." Keeling and department staff said the department has let 38 projects to date, had let nine projects in the then-current quarter and expected five more lettings before quarter-end and 14 in quarter 4.

Why it matters: the LTIF exercise was presented to the Legislature as a test of DOTD's ability to identify low-risk, preservation projects and deliver them within a single fiscal year. Committee members said they want clearer, more reliable letting schedules and more transparent accounting of obligations versus cash expenditures.

Permitting, design and constructability issues accounted for most of the delays the department reported. DOTD officials told the committee that two projects moved from quarter 2 to quarter 3 due to a constructability issue and permitting delays tied to a DENR coastal-use permit that took longer than anticipated to issue. Department presenters described those as relatively minor slips, generally measured in weeks to a month.

Committee members pressed DOTD on the meaning of "preconstruction" funding and the stages that precede being "shovel ready." Department staff explained that preconstruction covers stage 0 through stage 3 activities: feasibility, environmental (including any applicable NEPA work), right-of-way and utility work and final design. "This is the design effort, basically," a DOTD presenter said when asked to define preconstruction.

Several legislators asked about the fund accounting: Senator Abraham and others noted roughly $130 million obligated compared with the total $285 million and sought clarification on why a portion of the LTIF line items still showed unspent amounts. Keeling said some recently let projects had not yet executed contracts or been marked as obligations, which can create an appearance of a gap between the "let" amounts and obligational accounting.

Committee members also raised contractor availability, defaults and work-zone disruptions. Secretary Donahue acknowledged instances in the past two years where contractors have defaulted on work and the department has pursued funds from surety companies or exercised emergency contracting to finish work. "There have been numerous instances within the last year or two of people defaulting on their projects," the secretary said. DOTD said it retains rights to pursue bonding proceeds and implement remedies when contractors stop work.

Ending: DOTD told the committee it remains on target to obligate the balance of LTIF funds against the projects in the portfolio during the fiscal year, but members pressed for more granular, verifiable updates on obligations, cash expenditures and district-level readiness for projects. The department said it will provide more detailed obligation and payment figures on request.