The state can't move ahead with 29 road construction projects because of a financing shortfall of nearly a half billion dollars, Transportation Secretary Rhonda Faught told lawmakers.

The projects will be on hold until more money is found to pay for them, she said Friday.

"We will be needing a new funding source or new revenues to get that done in the short term," Faught told members of the Legislative Finance Committee.

The delayed projects were part of a $1.6 billion statewide transportation package approved in 2003 by the Legislature and Gov. Bill Richardson.

But Faught said the state won't have enough from planned bond financing to cover higher-than-anticipated costs of the highway projects authorized in 2003.

The $494 million shortfall, she said, is largely because of rapidly rising construction costs, such as higher prices for asphalt, concrete and other materials. She said there had been 34 percent construction inflation.

In addition, New Mexico isn't receiving as much federal highway money as the state had anticipated when the transportation package was approved. She estimated the state will get $570 million less than expected between 2006 and 2010.

However, some lawmakers contend the shortfall is partly because of spending by Richardson's administration on a $400 million commuter rail project, which currently runs between Belen and Bernalillo. Construction is under way to expand the Rail Runner commuter rail service to Santa Fe and that's to be finished in late 2008.

Sen. Joseph Carraro, an Albuquerque Republican, said that "all of those projects would have gotten done" if the state wasn't spending money on commuter rail.

Faught defended commuter rail and maintained that it didn't contribute to the shortfall, however.

"We're going to disagree, and that's just all there is to it," she told Carraro.

Carraro complained that lawmakers weren't given enough information about the potential cost of commuter rail when the project was authorized in the 2003 transportation package.

"There was no planning. We're still trying to figure out where the money is going to come from to plan now for the operation of it," Carraro said. "I guess this is government. But it just seems to me it's poorly planned government and I think that we really made a mistake in doing this."

A study group has suggested a number of proposals to resolve the financial squeeze facing the Transportation Department. The funding options include raising motor vehicle registration fees and increasing the state's gross receipts tax rate, with the money earmarked for transportation. A long-term option includes indexing the tax on gasoline to provide for automatic increases.

Rep. Luciano "Lucky" Varela, a Santa Fe Democrat, said the governor needed to publicly state what, if any, proposal he will support to provide extra money for transportation.

"We're hearing different stories in terms of support or lack of support and I don't want to go to a legislative session without having an administration supporting these initiatives, regardless of which ones they are," Varela said.

Among the stalled road projects are improvements on:

—Interstate 10 from the Texas state line to Las Cruces and an interchange near Vado and Mesquite and an interchange at New Mexico Route 404.

—U.S. 491 from near Tohatchi to Shiprock.

—U.S. 54 from Tularosa to Vaughn.

—U.S. 64 from Raton to Clayton.

—New Mexico Route 8 from near Eunice to the junction of U.S. 62 near Hobbs.

—U.S. 380 from Capitan to Hondo.

—U.S. 64 from the Rio Arriba County line east to U.S. 84.

—Interstate 25 in the Albuquerque area from Tramway to Bernalillo.




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