2020 has been rough. With a pandemic, a looming deeply divisive presidential election, civil unrest, record unemployment, and, depending on where you live, even some natural disasters like floods and wildfires, it may seem like it’s the perfect time to hunker down and not get any new ventures started. But within these constantly-referenced “uncertain times” lies unprecedented opportunity to do tangible, community-altering and legacy-creating projects. Need some convincing? Below are some reasons why, even in the midst of so much tumult, it’s a great time to do good work.
1. The federal government is providing grants and incentivizing development.
Through the CARES Act, the federal government is offering financial relief through grants, payouts from the Coronavirus Relief Fund, and direct loans. The grants are available for municipal agencies for projects promoting infrastructure, public services, community centers and economic development. The Relief Fund serves to cover budget shortfalls due to COVID-19, while the loan program has made $454 billion available as direct loans to businesses, states and municipalities under “favorable terms.”
2. The cost to borrow is historically low.
With the Fed cutting interest rates to nearly zero, and, in an unprecedented move, offering up to $500 billion in loans to states and municipalities through the purchase of municipal bonds, it’s never been less expensive to borrow money. In addition, the Fed has hinted that it would be open to expanding the program to buy more bonds in the future, with one Fed official calling the bond-buying measure “the first pass,” and stating that it “shouldn’t be viewed as a final word on any of these things, noting that distribution of funds across American communities is an ongoing area of concern. Finally, it is widely expected that the Federal Reserve Bank of New York will be soon be offering financial assistance through the Municipal Liquidity Facility, supporting lending to US states, US counties with a population of more than 500,000 residents, US cities with a population of more than 250,000 residents and multi-state entities.
3. Low demand for oil and building materials = savings.
For projects involving asphalt, the record-low oil price can reduce prices by 20 to 30 percent, while the low gas prices make it cheaper to move supplies to construction sites and transport dirt, stone and waste. In addition, the demand for building materials has decreased, resulting in lower-than-expected increases in prices: instead of the projected material cost increase of 1.5% in the first quarter, it was only 0.2%, while future costs are projected to decrease by 4.5% in the third quarter and 5.5% in the fourth.
4. With high unemployment comes a motivated, ready-for-work labor force.
As of the time of writing, the unemployment rate for construction works is at 16.6%, nearly two percentage points higher than the national average. This means that right now there are about 5 million construction workers who are at home, wanting to get back to work.
5. Tell us something good.
Image: Animal Crossing: New Horizons, Nintendo EPD/Nintendo
We’ve all been beaten down by the seemingly neverending cycle of bad news and hard times. After so much misfortune and anxiety, we all share the need for some measure of order and certainty – is it any wonder the gentle, G-rated Nintendo Switch video game Animal Crossing: New Horizons, with its focus on harmony, community and friendship, became 2020’s surprise runaway hit for adults and kids alike? It’s the human condition to want to look forward to things, believe things are going to be okay, that someday things will get back to something approaching normal. And, as a government official looking out for your community, you have the unique ability to perform public works that will fulfill this wish: to build the bridge that will be safer, widen the highway to be more convenient, process the water to be cleaner, manage the stormwater system to be less prone to back up and flood – all concrete projects that a person can point to and say, “At last, some good news!”
Looking back on all the reasons why moving ahead with public works projects makes sense even during pandemic, economic and political angst, perhaps the last reason is the most compelling – the need for normalcy among the chaos. When you add in the financial upsides for 2nd quarter 2020 civic projects and the ability to create jobs in an industry that has been particularly hard hit, it just makes sense to give the public what it so desperately needs: a reason to believe that even the world may be a mess, (almost) every little thing is gonna be all right.
If you’re ready to explore specific programs to improve the quality of life in your community, please contact one of our key staff below to get started.
Director of Business Development, Indiana/Kentucky Regional Director
Wisconsin Regional Director
Executive Vice President, Director of Engineering