Federal budget uncertainty complicates efforts to plan future Oklahoma road, bridge projects

The federal government shutdown is not yet impacting Oklahoma highway projects, but could prove problematic if Congress is unable to reach a long-term funding agreement, Oklahoma’s top transportation official said.

Tim Gatz, who heads the Oklahoma Department of Transportation, said the federal government is still processing his agency’s bills as the shutdown enters its second week. But as the 2026 federal fiscal year gets further along, his agency would have to “very carefully consider” which projects they can do and which they cannot if they don’t have federal participation.

But he also said it would still be problematic if Congress only passes a short-term funding resolution because it wouldn’t provide the Oklahoma Department of Transportation access to one full year’s worth of federal funding.

The federal government remained closed Monday after the Republican-controlled Congress was unable to reach agreement on either of two separate government funding bills by the start of the Oct. 1 federal fiscal year. A Republican proposal would keep the government open until Nov. 21. Democrats, meanwhile, have a separate plan that would permanently restore federal health subsidies.

Gatz said states are also waiting to hear what Congress plans to do when the federal Infrastructure Investment and Jobs Act expires at the end of the 2026 federal budget year. The measure, which became law in November 2021, appropriates nearly $1.2 trillion for transportation and infrastructure projects nationwide, including nearly $350 billion for federal highway programs.

Gatz said Congress is currently working on a new highway funding bill with the aim of sustaining current funding levels, but it’s going to be challenging because the Highway Trust Fund, which pays for transportation projects using excise taxes, only covers around 50% or 60% of all expenditures. The rest of the Act’s costs were deposited into the trust by Congress.

Gatz said it’s not yet known if that 2021 investment will be a sustainable trend.

“I call that to your attention because we are trying to project our federal funding availability with some uncertainty,” Gatz told the members of his governing board Monday during their monthly meeting.

He said it has already been a challenging year. Oklahoma lawmakers have had to provide an extra $200 million in one-time funding in budget years 2024 and 2025 to “help shield” the Department of Transportation.

The agency has been grappling with an “inflationary trend” that began in 2020 impacting heavy highway construction. An analysis of construction costs show they have increased over 63% since 2020, Gatz said.

The fiscal constraints have forced the state Transportation Department this year to delay some projects that it had planned to do as part of its eight-year work plan, Gatz said. That 2026 through 2033 work plan is planned based on critical infrastructure needs and projected federal and state funding.

“Those projects are still a priority, and they are still projects that need to be done,” Gatz said. “It’s just going to take us a bit longer to get to those projects.”

The latest eight-year work plan, approved unanimously by the Department of Transportation’s governing board Monday, contains over $7.08 billion in total investment in 1,266 individual projects. It prioritizes 460 individual bridges that need rehabilitation or replacement, 675 miles of improvements to two-lane highways with deficient shoulders, and planned pavement improvements to 2,810 lane miles, officials said.

“The needs are just outpacing our ability to get there with the improvements,” Gatz said. “We’ll carry those discussions into the legislative session to make sure the Legislature understands what’s going on.”

He said the state’s highway system is the largest publicly owned asset, valued at over $100 billion. It needs about $27 billion in investments to bring it to an acceptable standard.

Oklahoma Voice (oklahomavoice.com) is an affiliate of States Newsroom, the nation’s largest state-focused nonprofit news organization, supported by grants and donations. Oklahoma Voice provides nonpartisan reporting, and retains full editorial independence.