Georgia is primed to improve its infrastructure in a big way. An estimated $11 billion is on its way over the next five years to help Georgia tackle some big projects. These include improving roads and bridges, building electric vehicle infrastructure and improving the electric grid. However, time is ticking on the project deadlines and inflation is exacerbating the lengthy laundry list of problems Georgia is facing.
There are several new laws that Georgia passed to get to the $11 billion budget. There’s the most obvious place the funds are coming from. The Biden administration infrastructure project will divide funds among the states. The purpose of these funds is to make improvements to roadways and help combat emissions. However, Georgia passed several state laws to increase this budget. The Infrastructure Investment and Jobs Act (IIJA) and the Surface Transportation Block Grant (STBG) helped build their budget even higher. But there’s a ticking clock on these funds.
An estimated $225 million is set aside just to repair, replace, or improve 5,600+ bridges. Even more funds will be used to build EV charging stations and electric grid improvements. However, this money rolls out over the next five years. If these projects aren’t funded and paid for by the end of that 5-year mark, the money goes back to the state. They will then decide how they want to spend the money again, and the cycle continues. Things were moving along fine, until rising inflation caused many project developers to hesitate.
Georgia has an Inflation Problem
The prices for metals like steel and aluminum are at record high levels. This has caused previous project cost estimates to be askew and grossly undervalued. Not to mention, the rising cost of petroleum means they must now reevaluate almost every project on the docket. The logical thing to do is to wait out inflation. Increased loan rates are already combating inflation, and estimates suggest that by late 2023, America will begin to see relief. But Georgia doesn’t have that kind of time. By late 2023, these projects need approval status or, hopefully, even a completed couple to meet their 5-year deadline.
There’s no question that Georgia will spend that $11 billion. The question now is, how far will that money go? The idea that the money will solve all of Georgia’s problems may be more of a fantasy than reality. Don’t get it confused; completion of many of these projects is a certainty. The only difference is that planners are prioritizing which ones are first. It’s just that this perfect storm that Georgia finds itself in may just blow away many of the passion projects Georgia residents really wanted to see.