Two regional transportation projects could be backed by funds slated to be made available this month: the state’s $700 million in Build NC transportation bonds.
The Military Cutoff extension project and a project to make improvements to Market Street, between Middle Sound Loop Road and Marsh Oaks Drive, have earmarked nearly $65 million of those funds, according to officials with the N.C. Department of Transporation.
On Monday, N.C. State Treasurer Dale Folwell and the State and Local Government Finance Division announced the state was on track to issue $700 million in Build NC bonds by the end of October, according to a news release.
The two projects in New Hanover County, part of NCDOT's Division 3, are among a list of about $815 million in state Build NC projects anticipated to be financed with 2020 Build NC bonds, said Dan Way, communications manager for the Office of the State Treasurer.
The $700 million figure is the “face value of the bonds,” Way said in an email.
“But it is anticipated investors will be willing to pay a premium price above that in order to obtain these high-quality bonds. So the sale is expected to yield a higher total of $815 million. That $115 million difference in the purchase price will be used to pay the costs of the bond sale,” Way said. “Whatever is left over after the costs are paid can be added to the $700 million to pay for highway projects. Once the sale is completed on Oct. 29, the project list will be adjusted to match the total proceeds actually available to fund transportation projects.”
The Build NC bonds are part of a $3 billion transportation package approved by the General Assembly in 2018. The state issued $300 million of the bonds in the summer of 2019, stated the release.
Build NC is “a financing tool that will ensure the N.C. Department of Transportation can continue strong delivery of critical road projects at the regional and division tiers that do not qualify for a similar federal funding tool,” according to the Build NC website. “Those projects will benefit residents across North Carolina by providing the infrastructure to better access jobs, health care facilities and educational opportunities.”
The largest of the two regional projects, the Military Cutoff extension project, has $46.5 million in Build NC bonds available. The connection will include a new roadway and interchanges in Wilmington from Market Street to the U.S. 17 Wilmington Bypass. The $95.5 million construction project is currently underway. It is expected to be completed in the spring of 2023.
The Market Street project has earmarked, according to the current plan, nearly $18.3 million.
The latest round of bonds comes amid financial issues with NCDOT.
"In 2019, NCDOT spent nearly $7 billion against revenues of only $5 billion. In addition to the nearly $2 billion in overspending, NCDOT made $1.1 billion in 'short-term' loans from the Highway Trust Fund (HTF) for the Highway Fund (HF) between April 2018 and April 2019," stated a news release.
A Memorandum of Agreement (MOA) between the state treasurer's office, the Office of State Budget and Management and the Office of the State Controller was signed establishing formal oversight of and accountability for any short-term loans from the HTF to the HF during the life of the Build NC program, stated the release.
“I’m pleased to announce that the MOA has been signed so we’re able to move forward with the additional Build NC bond sale later this month,” Folwell said in the release. “We’re getting what we believe to be accurate information from DOT. I want to thank [NCDOT] Secretary [Eric] Boyette, his staff and industry leaders including the Carolina Asphalt Pavement Association for their diligence in getting the information we need to issue these bonds.
"The hardworking men and women at DOT and the hundreds of contractors across the state need sustainable and consistent funding to address current and future road-building and repair needs of North Carolinians."