The American Road and Transportation Builders Association disputed an Associated Press study of stimulus spending that claimed the influx of federal dollars had no effect on local unemployment rates. ARTBA said the report was based on an incomplete understanding of the construction industry.

“The truth is ARRA funding—as ARTBA members and economists have testified to Congress—has been the lifeline that has, thus far, kept much of the industry afloat during the economic downturn,” wrote Alison Premo Black, senior economist and vice president of policy for ARTBA. “To understand and appreciate this impact, however, one must understand what drives the transportation construction market and look at more than two sets of data points.

“So what happened with these funding sources during the past year? Well, the federal government, through the core federal highway and transit aid program to the states and the ARRA funds delivered record-level transportation funding to state and local governments.

“At the same time, however, ARTBA’s analysis of state contract award data for highway and bridge projects through last November shows that for a variety of reasons, 25 states either put fewer highway and bridge construction projects out for work in 2009 compared to 2008, or invested less money overall in highway and bridge construction projects last year than they did in 2008.

“The conclusion to be drawn from this is obvious. Many states, suffering from lower tax collections precipitated by the economic downturn and struggling to meet balanced budget requirements, delayed or cut their own funding for transportation improvements.

“The AP story fails to recognize these fundamental market realities and chooses to try to view stimulus funds in a vacuum that does not exist in the real world. While ARRA is ‘blowing up the balloon of job creation,’ state and local transportation funding cuts and delays in many areas of the nation are putting holes in it.”

Go to ARTBA to see the entire article.