Funding

President Obama’s new  $50 billion infrastructure initiative — part of his  $447 billion American Jobs Act (AJA) — offered no surprises. It’s almost an exact replica of his FY 2012 budget request which included a  sum of $50 billion for transportation to “jump start” a proposed $556 billion six-year surface transportation reauthorization.

The rhetoric may have changed — Obama avoided using the terms “stimulus” and “infrastructure” in presenting his AJA initiative to Congress — but the substance of the two initiatives is remarkably similar. Both proposals would fund an identical mix of programs (highways, transit, Amtrak, high-speed rail, aviation and the TIFIA credit program) and both would establish a  National Infrastructure Bank. Read More ›

In a bi-partisan pitch, former Pennsylvania governor Ed Rendell (a Democrat) and current Mesa, Ariz., mayor Scott Smith (a Republican), argue in today’s Wall Street Journal for a stronger U.S. investment in transportation infrastructure.

Whether it involves highways, railways, ports, aviation or any other sector, infrastructure is an economic driver that is essential for the long-term creation of quality American jobs.

When it comes to transportation, Washington has been on autopilot for the last half-century. Instead of tackling the hard choices facing our nation and embracing innovations, federal transportation policy still largely adheres to an agenda set by President Eisenhower.

Investments in transportation infrastructure–especially strategic, long-term investments–are investments in the future of the country. And as Rendell and Smith argue, true transportation investments aren’t (or shouldn’t be) a partisan issue.

Building America’s transportation infrastructure has been a national goal since Thomas Jefferson promoted canals and roads and Abraham Lincoln helped forge the Transcontinental Railroad. And still today, there remains a justifiable federal responsibility to address the country’s infrastructure decline. But it must be addressed thoughtfully, and much differently from the past. The sole responsibility can’t be left up to the federal government–from a financing or management perspective. (Indeed, given the current economic outlook, we’re probably well past the days when this made sense–if it ever did.) Instead, infrastructure investments could benefit tremendously, especially in terms of innovation and financing, from public-private cooperation.

Ultimately, despite the economic chaos we find ourselves in, we need infrastructure improvements that will contribute to the long-term economic growth of the country. Hopefully, Messrs. Rendell and Smith aren’t the only ones willing to cross the political aisle to cooperate on this issue.  
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Policy shifts are often so nuanced and subtle that they’re almost not recognizable. Sometimes, however, as with U.S. Secretary of Transportation Ray LaHood’s announcement about new funding guidelines for transit projects, they are stark enough to warrant the laudatory adjectives found in the press releases describing the policy change. The latter is true for the announcement that the U.S. transportation chief made at yesterday’s Transportation Research Board’s annual meeting. “Our new policy for selecting major transit projects will work to promote livability rather than hinder it,” said Secretary LaHood. “We want to base our decisions on how much transit helps the environment, how much it improves development opportunities and how it makes our communities better places to live.” The Obama Read More ›

A small but influential group of individuals gathered recently at the downtown Washington office of University of Virginia’s Miller Center of Public Affairs at the invitation of its Director, former Gov.Gerald Baliles. The bipartisan group included two former U.S. Transportation Secretaries and some 30 key players and opinion leaders who constitute what could be loosely described as Washington’s unofficial permanent transportation policy establishment.
The purpose of the meeting was to solicit advice on a set of recommendations stemming from the Miller Center’s fall transportation conference. The central challenge was posed succinctly by Gov. Baliles at the outset of the meeting. The transportation sector, he suggested, is being neglected despite the evidence of a mounting crisis – aging infrastructure, growing traffic congestion, strained freight and logistical facilities. Both the Congress and the Administration are extemporizing rather than taking bold steps to avert the looming crisis.
Where is the outrage, Baliles asked. Why is there no popular outcry? And what can we do to overcome this inertia? How can we create a sense of urgency and develop a narrative that will reverberate with the public, capture the media’s attention and goad Congress and the Administration into action? The Governor’s conclusion: we must involve “the three Ps”: the Public, the Press and the Politicians.

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Secretary of the U.S. Department of Transportation under George W. Bush, Mary Peters recently told the Austin-San Antonio Corridor Growth Summit that the country needs to move toward a vehicle miles traveled (VMT) tax to replace the failing gas tax. At the same time, a new survey conducted by the Mineta Transportation Institute at San Jose State University shows drivers warming to a mileage tax if lower emission vehicles get discounted rates. At issue is how to pay for maintenance and expansion of roads and transit systems after 40 years of vast growth in system use, and looking toward a tricky double-whammy. More population and jobs in coming decades will strain metro-region surface transportation systems, while flattening per-capita miles driven and greater fuel efficiency are curtailing growth in the per-gallon gas tax revenues that have traditionally been the prime source for surface transportation funding.
Broad implementation of the mileage tax is at least 10 years off, maybe 15. In the nearer term, variable-rate, electronically tolled express lanes are needed aside free lanes on major metro region highways, along with expanded opportunities for public private partnerships and other local and regional funding tools. Eventually, the mileage tax could be levied for travel on arterial and feeder roads, plus highways, with discounts for less congested routes, and possibly, lower emission vehicles. Incentives such as pay-per mile car insurance and meter-less, ticket-less parking could help compensate for privacy concerns. With a slew of VMT pilot projects, technical studies and surveys completed and more underway or coming, this bold policy initiative continues to gain momentum. Here’s the San Antonio Express-News on Peter’s remarks:

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Yesterday in Crosscut, the Northwest online daily journal of politics and public policy, I published a piece titled “Time to Go ‘All In’ On Tolls.” It starts this way: The four-lane Evergreen Point Floating Bridge across Lake Washington on State Route 520 is a relic of a bygone era, congested and disaster prone. How urgent is the need for a planned six-lane replacement? The Washington State Department of Transportation has gone so far as to graphically model on YouTube how the bridge might buckle under duress, threatening lives and paralyzing the region’s highway network. And is the region stepping up to the challenge? Less than half the funding is secured. The Seattle-side configuration is still being debated. More broadly, the project begs a Read More ›

Among the pressing legislative priorities facing Congress this autumn — besides the headline-grabbing health care and climate change bills — is an extension of the federal surface transportation program. The program authority expires on September 30 and its renewal is essential to keep federal transportation money flowing. The House and Senate have been on divergent paths in their approach toward renewing the program. The House Transportation and Infrastructure Committee, under the leadership of Chairman James Oberstar (D-MN), has been intent on passing a six-year $500 billion surface transportation measure ($450 billion for highways and transit, $50 billion for high-speed rail) during this session of Congress. In late July, a bill to this effect was reported out by the House Highways and Transit subcommittee. Chairman Oberstar announced at the time that he would hold a full committee mark-up soon after the House returns from its summer recess.
The Senate, on the other hand, has been working toward an 18-month extension of the existing surface transportation program. Its rationale for doing so was succinctly stated by Sen. Barbara Boxer (D-CA), chairman of the Environment and Public Works Committee, and Sen. James Inhofe (R-OK), ranking minority member. There simply is no way, the two senate transportation leaders concluded, that Congress could pass a multi-year authorization of the surface transportation program before the program’s expiration at the end of September. “There are just too many big questions left unanswered, not the least of which is a lack of a consensus on how to pay for it,” Boxer and Inhofe stated. A better approach, they said, would be to pass an 18-month extension as recommended by the Obama Administration.
Left unsaid were probably two other motives for wanting to postpone enactment of a long-term legislation.

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In a significant return to a controversial topic – the positive mention of which once earned him a sharp public rebuke from President Barack Obama’s press secretary – U.S. Transportation Sec. Ray LaHood today in Chicago reiterated the possibility of vehicle mileage fees to help pay for mounting U.S. surface transportation needs. His remarks indicate a softening of Obama’s official position against the idea. Underscoring evolving bipartisan support, Republican U.S. Rep. John Mica, the ranking minority member of the House Transportation and Infrastructure Committee, explains to a Florida paper today why the mileage tax makes sense, long-term. No such policy will be enacted anytime very soon, but could begin to move more seriously toward eventual mainstream adoption as part of Read More ›

Jarred into action by the tragic I-35W bridge collapse in Minneapolis in 2007, the Minnesota legislature in early 2008 proudly passed a $6.6 billion surface transportation funding bill including the state’s first gas tax hike in 20 years, plus optional sales tax hikes, a major bonding program and other measures. But 18 months later, according to its new transportation policy plan, the North Star State faces a $50 billion gap in paying for surface transportation projects over the next 20 years. Of $65 billion in needed work, only $15 billion is currently expected to be available, with three-quarters of that targeted for preserving existing roads and bridges. Officials say safety won’t be compromised. But mobility and pavement condition will. The executive summary from the report reveals (pp. 14-15) the full battery of envisioned projects are to meet system performance targets as the population grows, mainly by improving mobility in inter-regional corridors and mitigating congestion in the Twin Cities, Rochester and St. Cloud areas.
Chapter 4’s discussion of state trends affecting transportation provides more detail. Population is projected to rise 25 percent from current levels by 2035, which would be 50 percent since 1990. Congestion in the metro regions is expected to grow due to more population, a high rate of solo driving on all trips, greater commuting distances and high use of inter-regional corridors. (State highway map here). Needed projects are detailed in the accompanying statewide highway investment plan (full report here; Twin Cities district here). Given the wide funding gap between needs and resources, leaders want to encourage new ways of maintaining roads, pricing limited peak-hour highway capacity, deploying in-vehicle technology, and funding system improvements. The Minneapolis Star-Tribune reports:

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When Congress passes a new $450 billion six-year surface transportation reauthorization sometime in the next 18 months or so, it would directly yield $90 billion per annum, split nationwide over its term. That probably sounds like a lot of money, but it’s not. As the House Transportation and Infrastructure Committee’s blueprint for the reauthorization bill notes on p. 7, needed U.S. road and transit projects require $225 billion to $340 billion per year in public and private investment over each of the next 50 years – this according to the National Surface Transportation Policy and Revenue Study Commission. Even scaled-down needs identified by the National Surface Transportation Infrastructure and Finance Commission – also cited in the committee’s reauthorization blueprint – are sizable: $200 billion per year in public investment to maintain and improve the most essential components of the nation’s highway and transit systems.
The expected $48 billion in 2009 ARRA stimulus bill spending on transportation makes only a minor dent in either amount. Despite the possibility of some additional leveraged funding via an envisioned infrastructure bank that could be rolled into the reauthorization bill, it’s increasingly clear that manna from Washington – though important – isn’t a stand-alone solution.
That’s because of deepening maintenance and construction needs resulting from four decades of robust growth in passenger and freight vehicle miles traveled, plus simultaneous under-investment in infrastructure, and continuing population growth. And so across the U.S., more and more states and regions are grappling with difficult political choices to pay for fixing eroded transportation infrastructure, and for building new capacity and instituting other strategies to ease traffic congestion as the economic recovery unfolds in the next several years.
The first step is realizing you have a problem. There’s a fair amount of that going around.

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