Posted on 04/27/2017 8:04:46 AM PDT by Tolerance Sucks Rocks
California's $54 billion plan to fix roads and fund highway improvements cleared a major hurdle late Thursday, passing in the state legislature and setting the stage for what could become a massive spending spree.
Positive comments last week from analysts about the state transportation plan sent shares of several construction-related companies sharply higher. Some of them continued to trend higher this week and with passage in both houses of the legislature it's possible they could rally Friday.
Analysts have suggested beneficiaries of the state spending could include Summit Materials, a construction materials producer, and AECOM, an engineering firm. Summit's stock jumped more than 5 percent last week and was up another 2 percent on Thursday.
Goldman Sachs last Wednesday recommended investors buy call options on Vulcan Materials - a producer of aggregate materials used in highway construction - as part of a strategy to benefit from the California transportation spending bill. The call options go up in value when the stock rises, and in the case of Vulcan its shares spiked nearly 7 percent last week.
Also, Cowen last Friday said it sees the California infrastructure spending as particularly lucrative for Granite Construction given the company has a 10 to 15 percent share of the state highway spending already.
The legislation, part of a transportation funding package, provides money for local and state projects to fix roads, highways and bridges as well as to fund other transportation programs. The plan would generate about $5.2 billion in new taxes annually over the next decade by increasing gasoline taxes by 12 cents per gallon to 30 cents per gallon in the Golden State.
The last time the state increased the gas tax was in the early 1990s.
California's Senate voted 27-11 to approve the transportation plan, while the Assembly chamber passed it 54-26, barely reaching the two-thirds required. Governor Jerry Brown has already promised to sign the legislation into law.
Brown traveled throughout the state this week to lobby for the proposal, which also would raise money through vehicle taxes.
According to Brown, the state had a backlog of more than $100 billion in unfunded transportation needs even before the heavy winter rains caused damage to highways, bridges and local roads.
Some Republican lawmakers opposed the plan arguing the state currently has some of the highest gasoline prices nationally and the additional gas taxes would encourage more businesses to leave California.
Critics also contend the state has a history of raising money from gas or vehicle taxes and siphoning the money away to fund programs unrelated to roads, bridges or other transportation needs. That said, backers of the plan insist the legislation includes safeguards to prevent the funds from going to purposes other than for transportation.
Dear CNBC:
It’s either $52B or $54B. It can’t be both.
“Construction stocks could rally as California’s $52 billion roads plan clears major hurdle”
How much of that will actually be going for roads?
A lot of those roads might end up underwater as a result of the $0.00 dam, but hey... :)
The rest they will blow on illegals and campaign donations to get more demonicRATS elected.
What is Sanctuary state costing Californians ?
http://www.nationaleconomicseditorial.com/2017/02/21/costs-illegal-immigration-california/
Here’s where to look
#3 Not a dime will be spent filling in potholes.
I have been driving over the same bad roads for decades.
There is a stretch on the 405 freeway just past the sepulvada pass that is a washboard. It was 3 decades ago and still is today. They have spent billions widening and “improving” the road thru the sepulvada pass.
They added car pool lanes.....
It won’t be either one. By the time it’s finished, it’ll cost five times as much.
If Kalifornica would deport all the illegals, they wouldn’t need new roads.
And the state will have to hand out IOU’s to pay them.
red
“”:Critics also contend the state has a history of raising money from gas or vehicle taxes and siphoning the money away to fund programs unrelated to roads, bridges or other transportation needs. That said, backers of the plan insist the legislation includes safeguards to prevent the funds from going to purposes other than for transportation:””
Critics know what they’re talking about. Those two sentences are all we need for our laugh of the week.
[snort!] Bwaha, they think the revenue will get spent on highway work... HaHaHahaha.
Is that stretch concrete or asphalt. If it’s concrete, it might be spalling.
Zackly.
Roads? What does California need roads for with their wonderful train system? Oh yeah...
And here come the environazis. Every pot hole, every crack, every pullout shoulder will have an endangered weed that ONLY grows in that one spot and all construction must be halted immediately. I wonder how much Feinstein is making off this?
Probably a plan to use it all as a slush fund to pay pensions and provide “free” health care for the subjects of Kalifornia and the illegal invaders they love so much.
California won’t spend the money on roads., They’re going to squander it on Jerry Browns two pet projects: the Delta Tunnels and the absurdly gerrymandered high speed rail project.
This boondoggle grew $2 billion already from the title to the first sentence. Just imagine the cost overruns after the shovels start hitting the dirt.
Dear CNBC,
Put the CRACK PIPE DOWN. Not one Penny of this new TAX will be used for repairing ANY ROADS Anywhere in the State of California. ALL of it will be used on Mass Transportation, namely the Browndoggle and Bus Lines, anything left over will be diverted to the General Fund to shore up Public Pensions.
Anybody want to make a BET on this??
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