Federal tariffs could soon be propelling the costs of state construction projects higher in Kansas, officials are saying.
In February, President Donald Trump announced a 25% tariff on steel and aluminum. He did it because foreign countries are “flooding the United States market with cheap steel and aluminum, often subsidized by their governments.”
Calvin Reed, secretary of the Kansas Department of Transportation, said those tariffs could have a huge impact on projects. He said the average cost for construction is already 40% higher when compared to projections from 2020.
More expensive projects and tariffs make the future construction less clear.
“If tariffs go up, if prices continue to go up, if revenues go down, if more money is transferred away,” Reed said during a mid-March budget meeting, “then there are projects that will likely have to be sacrificed.”
The Kansas Department of Transportation spent $1.1 billion on 467 projects in 2024.
Now another wave of tariffs is expected on April 2, which Trump has called “liberation day.” The president has vowed to impose reciprocal tariffs on a wide swath of countries with the hopes that it will be good for America in the long run.
“Tariffs are about making America rich again and making America great again,” Trump said in his March 4 joint address to Congress. “And it’s happening, and it will happen rather quickly.”
But some experts say that won’t happen, adding that tariffs will hurt Kansans.
The president has been inconsistent on tariffs. He has imposed them, backed off, threatened them again and delayed them. It isn’t clear what will happen on April 2, but The Beacon looked at the steel and aluminum tariff already in place and its impact on Kansas.
William Hauk, an associate professor of economics at the University of South Carolina, said he expects the tariffs to be problematic. Construction projects are going to cost more, he said.
Trump has imposed tariffs before, but Hauk said the 2018 tariffs and what’s happening in 2025 aren’t comparable.
The 2018 tariffs were much smaller in scope. Trump imposed a 25% tariff on steel and 10% tariffs on aluminum with many exemptions. Notably, Argentina, Australia, Brazil, Canada, Japan, Mexico, South Korea, the European Union, Ukraine and the United Kingdom didn’t pay that tariff. Now they will.
Trump’s end goal is to raise prices on foreign products so U.S. companies are incentivized to produce more. He reasons that will bring more jobs to the country and eventually lower the cost for American consumers.
Hauk said that isn’t what happened in 2018. He said the 2018 tariffs likely saved 1,000 American jobs in the steel industry, but cost 75,000 jobs in industries that relied on tariffed products.
“Road construction or cars, planes — steel and aluminum is used as an intermediate input in lots of things,” he said.
One issue, Hauk said, is companies need to build steel and aluminum plants in the U.S. to avoid rising prices. That is a significant investment that doesn’t happen overnight, and it becomes even harder for businesses to plan for major costs when the tariff policy is so inconsistent.
“If you want to do something that’s good for manufacturing in the United States, you want to have some sort of relatively certain and stable policy,” Hauk said.
This story was originally published by The Beacon, a fellow member of the KC Media Collective.
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