ARTBA 2009 Economic Forecast: Highway Construction Spending Expected to Show Lit

The recent turmoil in financial markets may also affect the ability of some state and local governments to use bond-financing for transportation projects, which typically provides about five to 10 percent of project funding each year. Bond markets were inoperative in September and interest rates on tax-exempt bonds soared. Since then, rates have eased, but are still above last year’s level, which may temporarily affect plans to issue transportation-related bonds. Nonetheless, on November 4, voters in Alaska, California and Rhode Island approved new bond issues for transportation improvements, as did voters in various counties in Colorado, North Carolina, Oregon, Texas and Virginia.