DOT forced to halt previously approved projects due to Legislature’s inaction

TRENTON, NJ – In an effort to protect the state’s fiscal health, New Jersey Department of Transportation Commissioner James Simpson today was forced to halt all state-funded transportation construction projects effective Monday, October 4.

Due to the Legislature’s failure to approve a routine bond sale to fund previously authorized work, already in progress transit projects across the state will stop work.

“We have been forced to implement this work stoppage due to the Legislature's failure to approve a routine bond transaction for the fifth and final year of a transportation program that was approved under the previous Administration,” Commissioner Simpson said.  “Because of the Legislature's failure to act, thousands of engineers, planners, designers and construction workers will be put out of work and project schedules will be disrupted."

The Transportation Trust Fund Authority transaction involving the sale of up to $1.25 billion in bonds and the refinancing of up to $500 million in existing debt was anticipated to occur before the end of September to carry projects forward into the spring of 2011.


In January the Corzine Administration issued $857 million in bonds to pay the ongoing cost of these important construction projects with the understanding that the Christie Administration would need to issue bonds in the fall to finish the work. The Administration presented the Legislature with a responsible plan in early September and gained the support of the rating agencies over a week ago with the understanding that the Legislature’s work would be completed before the end of September. Without Legislative action, the Administration does not have funds available to continue work on these projects and must therefore cease work immediately.

In fact, approximately $300 million of the proposed bond sale must be used to reimburse the State’s General Fund which temporarily carried the TTF’s cash needs in recent months in anticipation of the sale of TTF debt.  Today, only $50 million remains in the TTF, all of which is needed to cover the next debt service payment in December.

The stoppage applies to approximately $1.7 billion worth of projects throughout the state, including the reconstruction of I-295 in Burlington County, the Route 3 Passaic River Crossing project in Passaic and Bergen counties and scores of NJ TRANSIT projects including the Hudson-Bergen Light Rail extension to 8th Street in Bayonne, Hudson County. About 100 NJDOT construction projects and 200 NJDOT design contracts are affected.

Local Aid funding is also affected, resulting in NJDOT notifying counties and municipalities that invoices cannot be processed during the stoppage.

Projects that are funded solely with federal funds would not be affected by a stoppage. Additionally, emergency repairs needed to ensure the safety of motorists and transit users will not be affected by the halt order.

NJDOT and NJ TRANSIT are alerting affected contractors, consultants industry and labor organizations today.