Surface Transportation:

Tight Budget Environment Requires Sound Investment Strategy

T-RCED-94-146: Published: Mar 8, 1994. Publicly Released: Mar 8, 1994.

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GAO discussed several issues affecting federal investment in the national highway infrastructure, focusing on: (1) the Federal Highway Administration's (FHwA) 1995 budget; (2) whether FHwA needs a project tracking system for individual highway demonstration project authorizations; (3) whether states use life-cycle costs to determine their highway budgeting; and (4) whether refinements are needed for the National Highway System (NHS). GAO noted that: (1) Congress will not be able to fully fund FHwA core highway programs in 1995 unless FHwA demonstration projects are rescinded or other highway and federal programs are cut; (2) FHwA ability to make decisions regarding its demonstration projects is hindered by its lack of sufficient information and a system that tracks the financial and construction status of individual demonstration projects; (3) although FHwA is developing a system that will capture information on individual project authorizations, the system needs to identify the reasons for project delays and annually update project information; (4) states need to use life-cycle costing during budget authorizations to ensure that the limited capital available is spent cost-effectively and increasing costs are contained; and (5) although the transportation community has made progress in developing NHS, FHwA needs to establish performance goals for pavement and bridge improvements and ensure that NHS achieves its primary goal of connecting NHS with other modes of transportation.

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