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The lack of a state budget - or the draconian cuts that may follow once it's finally adopted - bode ill for construction projects on highways and public transportation as early as next week.
And if no budget agreement has been reached by Monday, July 21, many contractors have told state officials they plan to begin walking off the job.
Jeff Morales, director of the California Department of Transportation, warned the Associated General Contractors of West Sacramento in a July 10 letter that without a budget in place by July 20, the State Highway Account won't have enough money in it to pay for work being done on the $6.7 billion worth of transportation projects currently under contract with the agency.
"At that point, we will be faced with the need to curtail, at least temporarily, construction and maintenance throughout the state," Morales wrote in the letter. "If this happens, we will pay all penalties and interest due according to statuses and contractural obligations when funding is restored. It may also be necessary to suspend or terminate some contracts to reduce costs, keeping in mind that safety is our first priority."
Morales blamed the situation on reductions in revenue from truck weight fees, lower gas tax receipts and "previous budget actions" by legislators.
He added that...