DOT outlines options for Highway 85 funding, warns federal formula money would delay other projects

Ron Henke, director of the North Dakota Department of Transportation, told the House Appropriations Government Operations Division that the agency needs a mix of funding to advance multi‑segment improvements on U.S. Highway 85, including a roughly $110 million 13‑mile segment for which the state secured a $55 million federal grant.

Henke said the green section of the corridor has a $110,000,000 estimated total cost and was awarded a $55,000,000 federal grant requiring a 50/50 match. He said the orange and red segments of the corridor are at differing stages of design and that the orange segment — a roughly 6‑mile stretch — has a current estimate of about $102,000,000 for utilities, right of way, engineering and construction.

Those figures matter because the agency’s other option for the orange segment would be to use federal formula (“80/20”) funds; Henke warned using formula money to fully fund a short four‑lane stretch would redirect roughly $80,000,000 of federal preservation and overlay funding from other projects across the state. “If we take 80% of a hundred million, move 80,000,000 for the stretch 6 miles, we're taking 80,000,000 from someplace else,” Henke told the committee.

The Senate amended the DOT bill to include $100,000,000 from the Strategic Investment and Improvement Fund (SIF) for the orange segment, according to committee staff and Henke’s presentation. Committee members asked staff where that entry appears on the agency worksheet; budget staff pointed to the one‑time funding list under Highway 85 projects.

Committee members pressed Henke on phasing. Henke said the red sections total about $330–350 million at current estimates and that the department is designing the red portion as three separate projects so the legislature could fund one stretch per biennium rather than attempting to fund the entire corridor at once. He said the green segment is close to bid and that the first steps after funding are right‑of‑way acquisition and utility relocation before heavy construction.

Why this matters: DOT officials said that because federal grants often require large matches and federal formula slices are spread across the system, the choice between SIF/state dollars and federal formula funds will determine whether the agency can build this high‑priority corridor segment without delaying preservation and overlay work elsewhere.

Committee commentary and next steps: Representatives asked for more detail on the SIF balance and how the pieces would fit on the department’s long funding sheet. Brent Brady (budget staff) said the SIF entry is the last item on the one‑time funding list. Henke and staff agreed to provide additional breakdowns for future hearings.