NCDOT announces layoffs and construction delays as coronavirus outbreak saps revenue
The N.C. Department of Transportation will lay off about 300 temporary workers and consultants and delay the start of about 88 major construction projects because of a sharp drop in tax revenue caused by the COVID-19 pandemic.
NCDOT estimates it will receive $300 million less in tax revenue than expected in April, May and June, as businesses remain closed and people travel less for work and recreation.
About 54% of NCDOT’s state revenue comes from gas taxes, which have dropped sharply since the coronavirus outbreak began last month. Traffic on major highways is down 40% to 50% percent across the state, Transportation Secretary Eric Boyette said in an interview.
“It’s very dire,” Boyette said. “We don’t see an uptick.”
Also hurt by COVID-19 and the resulting downturn in the economy is the highway use tax, a tax on car sales that makes up another 21% of NCDOT’s state revenue. The third big source is fees, mostly collected by the Division of Motor Vehicles, which are also down, Boyette said.
The workers losing their jobs work in NCDOT’s Highway Division and have been told Friday is their last day. More temporary and contract workers in other parts of NCDOT will likely lose their jobs as well in the coming weeks, the department said in a press release Tuesday.
So far, no permanent NCDOT workers have lost their jobs, but the department said it is developing plans for potential layoffs or furloughs.
In a memo to employees Tuesday, Boyette said he expects the revenue shortfall to continue into the coming fiscal year, which begins July 1.
“Because we do not know what form any potential assistance from our General Assembly or Congress will take, I have asked management to plan for the worst while we work for the best,” Boyette wrote. “Each business unit should plan for staffing to maintain only mission critical efforts — primarily health and safety.”
NCDOT is postponing the start of 88 of the 138 major road construction projects it had expected to start statewide in the coming year. The remaining 50 or so that will go on as planned are financed by bonds or federal money and aren’t as dependent on state tax dollars in the near term.
Construction projects that are already underway or have been awarded to contractors are not affected. Boyette said suspending or canceling a project that’s already underway can result in penalties or extra payments to contractors.
“That’s just another debt we’re incurring,” he said. “And we just want to finish the projects if we can.”
The projects that will be delayed include:
▪ The widening of Interstate 95 to eight lanes between I-40 in Johnston County and Exit 78 in Harnett County and between Exit 40 in Cumberland County and Exit 22 near Lumberton.
▪ The conversion of Glenwood Avenue into a limited-access freeway, with new interchanges, between I-540 and T.W. Alexander Drive in northwest Raleigh.
▪ The redesign and reconstruction of the Wake Forest Road interchange with the Raleigh Beltline.
▪ Repairing bridges and repaving along I-40 from U.S. 15-501 in Durham to Airport Boulevard in Morrisville.
More than half of the delayed projects statewide involve bridges, including the replacement of the Benson Road bridge over U.S. 70 in Garner.
This story was originally published April 21, 2020 at 11:59 AM with the headline "NCDOT announces layoffs and construction delays as coronavirus outbreak saps revenue."
