BRPC: Chapter 90 Spending Trails at Least a Year Behind
PITTSFIELD, Mass. — The Berkshire Regional Planning Commission has found that towns tend to act conservatively with Chapter 90 funds for road work because of uncertainty around the program.
BRPC's Senior Transportation Planner Eammon Coughlin did a study on the use of Chapter 90 in the Berkshires and found that there is at least a year delay between when the state funds are allocated to towns and when they are actually spent.
The state's Chapter 90 program is money bonded and sent to each municipality in the state based on a formula consisting of road miles, population, and employment. In 2012, the Massachusetts Municipal Association released a report showing that there is a funding gap of $362 million per year to keep the roads in a "state of good repair."
At the same time over the last five years, 75 percent of towns had spent less than the annual funds allocated. Coughlin reported that it isn't that the towns don't need the money or aren't spending it, but that the spending is seemingly trending well behind the allocation.
"There is at least a one-year lag in terms of how towns allocate their Chapter 90," Coughlin said.
That is particularly shown in fiscal years 2015 and 2016. In 2015, the state increased Chapter 90 by 50 percent, up to $12 million in Berkshire County. But, only half of that was spent — $6 million — and the overall unspent money at the end of the year hit a recent high of $18 million. In that one year, the towns received more but spent less than any prior year, and banked more.
Yet, in 2016, the spending hit a peak of $10 million and the overall money saved dropped by $2 million. It was the only year in the five-year period between 2012 and 2016 when spending was more than allocated.
So why is there a delay? Coughlin said the 40 percent of Berkshire municipalities responding to his survey reported delays in getting projects started. He said any delay, such as high bids causing a rebid or a shortage of highway staff, can easily push a planned project back a year.
Towns also don't start projects until that money is in hand, which means they often miss a construction season and the work gets pushed off until the following year. Coughlin said that is caused by the uncertainty of whether the funds will be available from year to year, if there is an emergency, and how much a town can expect.
He believes that if some of the uncertainty was removed with the project, the time between allocation and expenditure will shorten.
Many of the communities reported that their individual allocation — which tends to be $200,000 or less per year — isn't enough. Small towns will stash multiple years' worth of Chapter 90 money aside in order to take on a larger project. It can cost about a $1 million a mile to redo a road.
"It is routine for a municipality to save up for multiple years," Coughlin said. "Towns report that it takes several years to accumulate enough Chapter 90 to spend in a meaningful way."
Coughlin added that he doesn't know what towns are doing with their own funds toward road repairs. Many towns budget for roadwork, which is supplemented by the state funds. He believes when, how much, and what those funds are being spent on will help complete the picture of how roadwork money is being handled.
By the end of 2016, Lenox and Alford were the only towns with nothing left in their Chapter 90 fund balance. In total, 41 percent of municipalities had a year of funding left and 59 percent of towns had more than that. At the end of 2016, Egremont had 537 percent of its annual allocation in balance.
Coughlin only had access to five years of comprehensive data on the program. But, throughout that five years, a number of towns had spent more than were allocated in that time period — such as Clarksburg, Lee, Sandisfield, and North Adams. Presumably, those towns had a prior balance and completed a larger project early in this reporting time period.
Coughlin also found another recent trend: towns are putting more and more of those funds toward full road reconstruction projects than before. The money can be allocated for engineering, equipment, resurfacing, and full construction of a roadway.
In 2012, 74.8 percent of the county's allocation was going to resurfacing, 14.3 percent to construction, 4.9 percent to equipment, and 6 percent toward engineering.
But by 2016, construction increased to 55.6 percent of the allocation, resurfacing dropped to 36 percent, equipment dropped to 3.9 percent, and engineering dropped to 4.5 percent.
"Towns are becoming more cautious. They want to spend money on a longer lasting reconstruction project," he said.
Coughlin added that the towns which get the fewest amount of Chapter 90 dollars spend the least on engineering.
"Some of our towns don't want to spend money on engineering and would like to see money go toward construction, he said.
The transportation planner is now recommending towns to review their road jurisdiction — the Road Inventory File — and make sure all of the roads being cared for are accounted. Coughlin said he's found a number of roads that towns were maintaining but weren't in the state file. He said that can help boost the amount an individual town receives. He is also recommending a pavement management planning system to make sure Chapter 90 funds are being used in the most efficient way — i.e. directed to the highest needs. He also advocates for a way to increase the amount of Chapter 90 funds to alleviate the backlog of work that towns are reporting.
Communities, however, offered other suggestions for the Chapter 90 program such as requiring local matches, placing a time limit on spending the money, eliminating the ability to purchase equipment, looking at ways to fund the program outside of a bond program, and increasing state revenues through a gas tax for the program.
Tags: BRPC, Chapter 90, road work,
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