ALBANY, NY (AP) New York State has stopped awarding transportation contracts following state Comptroller Alan Hevesi’s rejection July 21 of a plan to restructure $2.9 billion in Thruway Authority borrowing for highway and bridge construction.

Acting Department of Transportation Commissioner Thomas Madison Jr. said Hevesi’s action led to the halt in the awarding of $350 million in contracts. The DOT, controlled by Republican Gov. George Pataki, also is stopping the awarding of contracts for $30 million in engineering work, $20 million worth of rail work and $150 million in other projects.

Pataki’s budget office said state funds would be reserved for payments on already existing contracts and routine operations such as snow and ice removal.

The planned debt refinancing would have given the New York State Dedicated Highway and Bridge Trust Fund $1.3 billion to spend in the next five years by delaying principal payments until 2011. However, the state would have to spend an additional $1.772 billion over the last 15 years of the bonds, Hevesi said in rejecting the plan.

Hevesi, a Democrat, denied his move would cause any projects to be delayed or canceled since the state still has five years to come up with the money another way.

The planned $1.3 billion in savings was included as part of the five-year, $17.9 billion bridge and road spending plan.

The rejection of the plan “doesn’t mean a single project has to be postponed or delayed or canceled and anybody who tells you that isn’t telling the truth,” Hevesi said. “The highway bridge and trust fund is made up revenue from a variety of sources … no project is connected to any revenue sources or any one pot. No project is dependent on that $1.3 billion.”

Hevesi’s office said the state has $601 million in a surplus fund and a $768-million contingency fund for delays in projects to make up for a shortfall. The comptroller also said another $1.5 billion in federal funds was available to draw on to complete projects.

Pataki and lawmakers also could come up with a new borrowing plan that doesn’t push costs into the future, Hevesi said.

Pataki’s budget office disputed Hevesi’s claims, saying the federally funded highway construction contracts could be in jeopardy because of a lack of matching funds from the state. That could affect another $500 million of planned contracts on the state system.

“The comptroller’s assertion that the state has a $600-million surplus is just plain wrong,” Marr said. “It’s shocking that he wants to raid the state’s fiscal reserves to fund the fiscal hole that he himself has now created.”

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