The Associated Press//June 23, 2022//

By David A. Lieb and Michael Casey
The Associated Press
The price of a foot of water pipe in Tucson, Arizona: up 19 percent. The cost of a ton of asphalt in a small Massachusetts town: up 37 percent. The cost estimate to build a new airport terminal in Des Moines, Iowa: up 69 percent, with a delay of several years.
Inflation is taking a toll on infrastructure projects across the U.S., driving up costs so much that state and local officials are postponing projects, scaling back others and reprioritizing their needs.
The price hikes already are diminishing the value of a $1 trillion聽infrastructure plan President Joe just seven months ago. That law had included, among other things, a roughly 25 percent increase in regular highway program funding for states.
鈥淭hose dollars are essentially evaporating,鈥 said Jim Tymon, executive director of the American Association of State Highway and Transportation Officials. 鈥淭he cost of those projects is going up by 20 percent, by 30 percent, and just wiping out that increase from the federal government that they were so excited about earlier in the year.鈥
In Casper, Wyoming, the low bid to rebuild a major intersection and construct a new bridge over the North Platte River came in at $35 million this spring 鈥 55 percent more than a state engineer鈥檚 estimate. The bid was rejected and the project put on hold as state officials reevaluate their options.
鈥淚f this inflation keeps the way it is, we will have to roll projects from one year into the next, into the next, into the next,鈥 said Mark Gillett, chief engineer of the Wyoming Department of Transportation.
Gillett had hoped the federal Infrastructure Investment and Jobs Act would finance a boom in highway and bridge construction.
鈥淏ut it鈥檚 just not going to go as far as we had hoped,鈥 he said.
In addition to roads, the federal infrastructure bill includes billions of dollars for water projects, railways, airports, broadband internet infrastructure, electric grids and green-energy projects over the coming years.
Inflation has affected the entire U.S. economy, posing one of Biden鈥檚 biggest challenges during a midterm election year. Fuel, food and housing costs all have shot up.聽 in May聽from 12 months previous 鈥 the highest rate since 1981, according to the U.S. Department of Labor.
Prices for some key materials in infrastructure construction have risen even more. Prices paid to U.S. manufacturers of聽asphalt paving and tar mixtures聽were up 14 percent in May compared to last year, according to data from the Federal Reserve Bank of St. Louis. Prices for聽fabricated steel plates, used in bridges, were up 23 percent, and聽ductile iron pipes and fittings, used in water systems, were up nearly 25 percent.

The hikes are being driven by a variety of factors, including worldwide supply-chain backlogs, strong consumer and business spending in the U.S., Russia鈥檚 invasion of Ukraine 鈥 and, some argue, federal energy and fiscal policies.
U.S. Rep. Sam Graves, R-Missouri, the ranking minority member of the House Transportation and Infrastructure Committee, contends the infrastructure law itself is contributing to inflation by pouring more federal money into an economy already flush with trillions of dollars in federal pandemic aid.
鈥淭hey are borrowing more money so they can spend more money, (which) is driving inflation, which is cutting down on the projects that they鈥檙e actually wanting to do,鈥 said Graves, who voted against the infrastructure bill.
White House senior adviser Mitch Landrieu said the infrastructure law 鈥渁ctually positions us for lowering costs for families in the short and long term.鈥 He cited made-in-America requirements聽for steel, iron and other construction materials that could strengthen supply chains and thus lower costs.
Des Moines International Airport officials were counting on the federal infrastructure money to replace an aging terminal with a modern structure. Four years ago, a new 14-gate terminal was projected to cost about $434 million and be open by 2026. By this spring,聽the cost had soared to $733 million.
That鈥檚 more than the airport can afford, even with the federal aid, so officials are planning to break the project into phases. Five new gates will be built by 2026 at a cost of $411 million.
鈥淚f inflation continues, it may be a decade before the project gets completely done,鈥 airport Executive Director Kevin Foley said.
Other projects also have been rocked by inflationary price hikes.
Since voters approved a property tax increase in 2020, the estimated cost of building two light-rail lines and a tunnel through Austin, Texas, has聽gone from $5.8 billion to $10.3 billion. Doubling the tunnel length was a big factor. But inflation and surging real estate prices also fueled the increase, forcing officials to consider cutting costs or lengthening the time frame for completion.
鈥淚t鈥檚 been a challenge,鈥 said David Couch, chief program officer at the Austin Transit Partnership.
Low bids for a series of bridge repairs along Interstate 55 in St. Louis came in at $63 million this year, 57 percent over the budgeted amount. Overall, Missouri鈥檚 highway construction costs for the fiscal year ending in June were $139 million over budget 鈥 an 11 percent increase that marked a 鈥減retty significant swing鈥 from several under-budget years, state Department of Transportation Director Patrick McKenna said.
Though Missouri forged ahead with this year鈥檚 projects, inflation 鈥渨ill take a bite out of the future,鈥 McKenna said.
Inflation has carried more immediate consequence in some places.
When bids for a road project in Lansing, Michigan, came in 60 percent above estimates, the city rebid the project and cut its scope in half, said Andrew Kilpatrick, public service director and acting city engineer.
In Huntington, Massachusetts, a 1.5-mile stretch of road won鈥檛 be finished this year after a 37 percent spike in the price of liquid asphalt increased the cost for paving a mile to about $140,000. The town gets $159,000 annually in state funding for its roads, highway superintendent Charles Dazelle said.
鈥淩ight now, one mile of road, that鈥檚 one year,鈥 he said. 鈥淭hat is doing nothing else.鈥
Public water systems across the country also are straining under inflation. The city of Tacoma, Washington, is altering some of its planned water main replacements because of rising costs.
鈥淪ome of them are getting delayed, some of them are being reduced in scope, and it鈥檚 forcing us to reevaluate some of the budgets that we鈥檝e set forth,鈥 said Ali Polda, principal engineer in the city鈥檚 water department.
Residents in a neighborhood west of Little Rock, Arkansas, will pay a $146 monthly surcharge to Central Arkansas Water for installation of new water lines. The charge is 17 percent more than planned because of spikes in construction costs.
Other public utilities also will have to choose between scaling back work and passing along costs to customers, said Michael Arceneaux, acting CEO of the Association of Metropolitan Water Agencies.
鈥淚n the end, it鈥檚 going to be the ratepayers that suffer,鈥 he said, 鈥渂ecause the projects have to get done, and funding will have to come from the ratepayers.鈥
Editor鈥檚 note: Lieb reported from Jefferson City, Missouri, and Casey from Boston. Associated Press writer Josh Boak in Baltimore contributed to this report.