An ongoing construction project to widen Highway 101 in Santa Barbara is in danger of grinding to a halt because of a state panel’s decision Wednesday to freeze $3.8 billion in loans for infrastructure projects in order to pay for vital public services.
Citing the state’s historic budget quagmire, the state’s Pooled Money Investment Board — made up of the state’s controller, treasurer and the governor’s finance director — voted to stop the funding until June.
The move could put the brakes on nearly 2,000 public-works projects for highways, schools, levees, housing and parks.
Among them is the local project. Crews broke ground in July on the four-year project, which includes widening both directions of the freeway between Milpas Street and Hot Springs Road. It also includes improvements to a Milpas onramp and a roundabout on Coast Village Road at Hot Springs.
Gov. Arnold Schwarzenegger’s office blamed Wednesday’s action on legislators’ failure to pass a budget. Facing the possibility of a record $41.8 billion shortfall by July 2010, Democrats and Republicans are at a stalemate because of disagreements over how to close the gap.
“It’s outrageous that Republicans and Democrats would continue to play politics while tens of thousands of hard-working Californians face the possibility of being laid off this holiday season,” Aaron McLear, Schwarzenegger’s spokesman, said in a statement.
Local officials said they will try to keep the Highway 101 project moving without delay, but could give no guarantees.
Putting the project on ice would mean laying off about 1,000 local employees, said Jim Kemp, executive director of the Santa Barbara County Association of Governments.
“We’re hoping the Legislature takes action quickly to resolve the budget crisis,” he said. “It’s really beginning to come home to roost.”
The total cost of the Highway 101 project is an estimated $80 million, with $52 million of it slated to come through the Pooled Money Investment Board.
Kemp said Caltrans officials have told him they will try to avoid shutting down construction projects by finding money in their own budget.
Failing that, he said, SBCAG board, which includes the mayors of every city in Santa Barbara County, could vote to give the state a loan. The cash would come from the proceeds of a half-cent sales tax for transportation projects known as Measure D.
At most, Kemp said, SBCAG could lend the state only a “few million.”
In the meantime, he said, the contractor hasn’t been told to stop working on the project. (The construction sites have been deserted lately, but that’s because of the rain, not the state’s budget woes.)
“We don’t want to send all those construction workers home,” he said. “We don’t want them to lose their jobs at a time when our country is facing an economic crisis.”
Kemp added that even though the work, if stopped, would resume in June, the cost to restart the project would be “enormous.”
Lisa Rivas, executive director of the Regional Legislative Alliance, a council of business leaders from Santa Barbara and Ventura counties, described the news that the Highway 101 project could be delayed as “scary.”
“The people of these counties need that freeway,” she said. “It’s so frustrating when you sit on the 101 freeway anywhere from 3:30 on, and somebody can’t get 16 miles in a relatively efficient pace.
“This is a project that has the permits done, has all the actual heavy equipment on site. Don’t stop it now.”
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