NORWICH – Despite much concern over the state’s economic health, many municipalities breathed a sigh of relief last month as they received compensations from the Consolidated Local Street and Highway Improvement Program (CHIPS), that restored tens of thousands worth of jeopardized funding.

“CHIPS are the largest amount of aid the town of Norwich, and probably most other towns, annually receives from Albany,” said Norwich Town Supervisor David Law.

The Town of Norwich received around $71,000, the exact same amount it collected last year. David Hamburg, a spokesman for the state Department of Transportation in the Southern Tier, said every local government in Chenango County would receive the same amount of compensation from CHIPS as last year.

County Department of Public Works Director Randy Gibbon said the program was not technically a grant, but a compensation, explaining towns have to first spend the money and then are reimbursed by the state.

Law, like many other supervisors, budgeted lower than the typical amounts. The Town of Norwich budgeted $59,000 in preparation for a potential reduction in state spending.

“We’ve probably said it a hundred times, but because of the economy and the late budget we never knew what was going to happen in the end. Things seems to have turned out well this year, but the whole time they kept telling us they couldn’t promise anything and heading forward there still isn’t any certainty in getting next year’s amounts,” said Law. “This just might be the way business will be done until the state can sort out its bigger financial problems. It’s become one of those state things where we have no idea if were getting it next year.”

Law said the town would again budget for a highway fund shortfall heading into 2011. Law said the program is vital in paying for the paving of roads and upgrading equipment. The entire Town of Norwich highway budget is $335,000, including the $71,000 in CHIP funds, accounting for a quarter of the total costs. Law added that those costs would have to burdened by the taxpayer if the funding dried up.