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Road project costs are on the rise in Georgia

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(The Center Square) — With inflation hitting every corner of the marketplace, including local road projects, as state officials look to designate more tax dollars for transportation, Georgians will see less bang for their buck.

From the second quarter of 2020 to the second quarter of 2023, the highway construction cost index increased by 51%, Georgia Department of Transportation Commissioner Russell McMurry said during a Joint Appropriations Committee hearing.

According to the commissioner, between December 2020 and October 2023, the cost of resurfacing projects in Georgia increased by 80% to $335,000 per mile. The cost of a two-lane roundabout increased by 114% to an average of $3.4 million, while urban road widening increased by an average of 118% to about $19 million per mile for widening a road from two to four lanes.

“The transportation construction cost is outpacing even that of CPI [the Consumer Price Index],” GDOT Commissioner Russell McMurry said during an appropriations committee hearing.

In fiscal 2020, GDOT bid 238 routine maintenance contracts at an average of $428,527. In 2023, the department bid 99 fewer contracts — 139 total — at an average of $620,494. Overall, last fiscal year, the agency spent more than $2 billion on 301 projects.

“Now, out of the 301 projects we did, we did reject 25 projects, which totaled about $422 million,” McMurry said this week. “We rejected those bids, and we repackaged some of those to make big projects into smaller projects. And we simply rebid some projects as well. So why did we reject 25 projects? Those were due to high prices.”

That high prices have driven up local road project costs is not new. As The Center Square reported in October 2022, state transportation officials rejected and deferred some bids because they were 40% higher than projected at the time.

Georgia Gov. Brian Kemp has called for an additional $1.5 billion in state funds for the Georgia Department of Transportation for projects that “directly help move commuters and freight.” With federal tax dollars, Kemp proposed a $5.6 billion amended fiscal 2024 transportation department budget.

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