Late last week, the California Department of Transportation (Caltrans) held a conference call with the major highway construction associations (AGC, EUCA & SCCA) to assure our members that they will be able to make progress payments to contractor for work performed in August and September.
After that, if no state budget is in place, the transportation agency is worried about covering the $9.5 billion in work that is underway on state projects.
Earlier in the month Caltrans announced it was stopping award of any new projects--an estimated $3.5 billion in new contracts that would have employed an additional 50,000 construction workers.
Caltrans is trying to manage its cash-flow in lieu of new budget authority. By not awarding any new work, they think they can cover existing work for the next month, but could give no solid assurances about work performed in October and beyond.
Click here for details of this action, including a partial list of projects affected outlined in a memorandum from new Caltrans Director Cindy McKim to Dale Bonner, Secretary of the Department of Business, Transportation and Housing.
Please check with your contractors to see if any of their work is on the list, so that we can all properly inform members of the state legislature and the governor's office of the impact of this action.
Since this is the final week of the session, you can look for a budget to come out of a special session and a host of compromise bills used to buy votes from "reluctant Republicans" whose votes are required to pass a state spending plan. A "real" budget, complete with increased taxes, is expected to pass after the November elections.
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