Jeremy Mead, the agency’s chief engineer, told the Senate Transportation Committee that construction costs have climbed sharply and that AOT’s modeling shows pavement conditions could fall substantially if funding and buying power don’t change.

“It's three times more expensive to do a project in 2025 than it was in 2003,” Mead said as he summarized the Federal Highway Administration’s National Highway Construction Cost Index and AOT simulations. Using a FY26 paving program set at $103,000,000, Mead said the models project a marked deterioration of the network over the next decade: preservation treatments become infeasible on larger shares of the system, forcing more expensive reconstruction work.

Why it matters: the state must provide a state match to draw down federal dollars; when purchasing power declines, the same federal apportionment yields fewer miles improved. Mead gave treatment cost ranges to show how mix and timing change outcomes: preservation treatments on roads in good or fair condition cost roughly $300,000–$500,000 per mile, while intensive subbase reclaim plus new overlay can run about $1,000,000 per mile. Bridges, he said, deteriorate more slowly but are much costlier to restore, so their condition is less volatile but more expensive to fix.

Secretary Joe Quinn framed the problem as a triage question for limited dollars. “We need to do more miles. The issue here is how do we slice the pie with the finite number of dollars that we have to work with,” Quinn said, noting that towns face the same cost pressures and that collective strategies may be needed.

Committee members pressed for town‑level projections. Mead said the state does not yet have a full town‑road inventory modeled to the same level as the state system and that a study authorized in last year’s transportation bill will begin this work for reporting in 2027.

The briefing reinforced that even with federal aid, rising materials, labor and other input costs (and the need to match federal funds) create choices: preserve more miles now, which favors lower‑cost treatments, or allow condition to degrade and face more expensive reconstruction later. AOT told the committee it will return with additional data, including historic dollars and miles paid and the planned town‑road sample for 2027.