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After the stimulus…nothing

Jon Pletz of Crain’s Chicago Business has a piece on how the Illinois construction industry has depended on $936 million in federal stimulus money. Now that the stimulus cash is mostly gone, construction has ground to a halt. Illinois Gov. Pat Quinn did sign a 5-year, $31 billion bill last year for state-funded capital funding improvements. But with the state $13 billion in debt, the legislature has so far only authorized $700 million of this funding. In order to revive a state construction economy that has lost 20,000 jobs in the recession, Illinois must borrow money. But the state has already borrowed so much money to make pension payments that Moody’s has downgraded its credit rating.

So what can the federal government do? Well, the Illinois construction industry probably wouldn’t mind another stimulus. Both the state’s unemployment rate and budget deficit are worse than when President Obama signed the stimulus bill in February 2009. A more politically realistic solution is Congress finally re-writing the five-year surface transportation bill — a bill that was supposed to be completed in 2009. Currently, funds are just being carried over from the old legislation. A new package could provide federal funding for much-needed construction projects that the state, which must balance its budget, is unable to fund right now.

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