State’s rainy day fund provides immediate cash flow for road recovery needs
Raleigh, N.C. – The state General Assembly approved an additional $90 million of road construction funds to meet disaster recovery needs for the North Carolina Department of Transportation (NCDOT) this week that will operate as a cash flow loan while the state awaits federal reimbursement.
Senate Bill 605 Highway Storm Recovery Act creates the Disaster Relief Cash Flow Fund within NCDOT and directs the agency to deposit any reimbursements it receives from the federal government for disaster relief expenditures up to $300 million into the fund.
The state House gave final approval to the measure on Wednesday. The General Assembly has appropriated more than $1 billion from its rainy day reserve for disaster recovery after the state was hit by Hurricane Matthew in 2016 and Hurricane Florence in 2018.
The bill directs NCDOT to close the fund and transfer $90 million back to North Carolina’s savings reserve after it receives up to $300 million in federal reimbursement or by June 30, 2021, whichever occurs earlier.
The state’s transportation systems have been meeting disaster recovery costs upfront out of general maintenance reserves while North Carolina awaits federal reimbursements.
Without cash flow on-hand to loan NCDOT, North Carolina would have to delay recovery projects or payments instead of meeting those needs immediately.
The co-chairs of the North Carolina House Transportation Committee, Rep. Frank Iler (R-Brunswick), Rep. Michele Presnell (R-Yancey), Rep. Phil Shepard, and Rep. John Torbett (R-Gaston) released a joint statement.
“North Carolina remains well-prepared to provide immediate cash flow for road recovery needs from our savings reserve while we await federal reimbursement,” the co-chairs of the House Transportation Committee said in a joint statement.
“Smart budgeting and savings by the General Assembly made sure North Carolina had cash flow for critical transportation needs after back-to-back hurricanes, and we can continue to provide disaster recovery support thanks to our emergency reserves and responsible spending.”
The state budget proposal passed by the North Carolina House on May 3, 2019, also appropriates an additional $94 million from the Hurricane Florence Disaster Recovery Fund to meet critical recovery needs.