Congress is currently poised to challenge states and regions to an important test; will stimulus objectives be carried out as intended and can those results be measured? Both the House and Senate versions of the stimulus bills focus on accountability, something that has been missing from the federal transportation program for some time.  Congress is showing faith by not earmarking funds and not being much more prescriptive than current law.

If states, regions, and the private sector can prove to Congress and the Administration they can deliver on commitments in this stimulus package, the benefits of focusing on system goals  for the next federal authorization will be evident. The greatest degree of flexibility possible will be required to meet those goals. 

Now is the time for America to radically rethink the federal role in transportation.  We need a new vision for the future, shaped by customer-oriented, performance-driven criteria that address the needs of the people and businesses that use our roads, bridges and transit systems.

Here’s what I’d advise:

First, set goals and performance measures that focus on customer service.  President Obama, Transportation Secretary Ray LaHood, Congress, and the states must build a consensus on how to transform the system by thinking about how to best serve the network’s customers, both the movement of freight and people.

Second, look for every opportunity to minimize the impact to the federal budget.  There are many ways to increase transportation investment without raising taxes, and all potential solutions should be allowed. The federal government should encourage and enable states to employ business strategies and innovative finance techniques including tolling, congestion pricing, HOT lanes and a full range of public-private partnership mechanisms.

Third, encourage innovation at all levels.  Bold ideas to fuel transportation transformation abound and should be put in the mix of options.  Oregon is considering replacing their state gas tax – an unsustainable revenue source over the long term like its federal counterpart – with a pay-as-you-drive system.  Technology can and should drive that and other possibilities. States like Virginia, Indiana, Pennsylvania, Florida, and Texas are taking the lead in developing new sources of transportation funding by inviting private sector firms to invest in modernizing and expanding transportation systems.

Fourth, remove barriers between funds and programs.  As part of the national transportation vision, mobility problems and solutions should be considered in a comprehensive manner, without modal blinders.  That means having the ability to mix dollars regardless of source to solve problems regardless of mode.

Flexibility is critical to a new federal vision.  States and regions should be able to meet customer needs by applying new ideas and creative solutions to planning, funding, financing, procuring and operating transportation.  By considering a variety of solutions, the regions and states will choose options that will be fine-tuned over time to best meet their mobility needs. 

The federal government should set goals, require accountability and promote innovation.    That will lay the groundwork that challenges the transportation community to create and invest in a nationwide transportation system that meets our future needs, sustains our economy, and improves our quality of life. 

 

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What about one to ten dollars a gallon? 

$1.67 is an interesting number, but suppose we look instead at a broad range of possible prices -- for example something in the order of anywhere from one to ten dollars a gallon. Now that is an interesting question. What does a spread like this mean for national policy?  And If you are uncomfortable working with that huge range, well you better get used to it because it is just one example of what we call the New Normal.  That's the kind of thing that we need to be prepared to look at, understand, and work to make wise policy. That's our future.  And we can either make it, or sit back wait for it to happen to us. It’s our choice. 

To make some sense of this and lend what I hope will be a helping hand to the incoming transportation team, I would like to look at the future of continuing large swings in the price of gas at source and at the pump from two very different perspectives. The first is that of someone born and raised in a rural small-town environment in northeastern Mississippi, which today looks a great deal different from how things were when I was a child there.  The second is from the vantage of a strategic planner with a special interest in the politics of transportation from both a sustainability and global perspective. I would then like to see if we can find a way to put our heads together in order to piece the best ideas/opportunities of these two presumably polar positions together for policy purposes for the incoming administration. I am sure we can do it. 

Let's start with the Mississippi perspective. In many ways a typical citizen's-eye of what this is all about. 

Letter from Mississippi 

Today down in the lightly settled rural areas around my hometown of Amory Mississippi there are at least three unyielding realities which most of our friends and neighbors have to figure out how to live with every day. 

• First, that the time in which our town was a lively place which served to provide both the people who lived in town and surrounding communities with a wide range of goods and services all within walking or biking distances somehow disappeared in the closing decades of the last century.  No one here is quite sure of how or why it happened -- but it did and it was a great loss. One that we really start to feel as the price of gas climbs. 
  

• The second harsh reality is that as the town emptied out the only possible way of getting around today is . . .  if you have a car.  A very American phenomenon. But there is more to it than that. 

• The third is that most of us down here are not particularly rich, meaning that when gas prices double, triple worse, it hits us a lot harder than the average American. We are not only one of the poorest states in the Union, but today more than 20% of our neighbors live below the official poverty level.  And a lot more than that if you are a rural white and sadly worse yet if you are a rural black. 

So  as an average citizen from northeastern Mississippi I have some questions about how the new team in Washington is going to deal with the harsh realities we face both now and will surely have to face in the years ahead. This is one problem we can be sure is not going to go away by itself. 

To be perfectly frank certainly the most comfortable solution for us would be a return to dollar gas. One of the great conveniences of that is that it would allow us to keep going as we have over all these last years without changing.  Nobody really likes to change, at least when they feel it's being forced on them.  But we look around and we know that the world is changing, and I guess that includes us to. 

So the question becomes: how do we live down here with three or four or five dollar gas?  I guess we had to start thinking about that now.  And at five dollars a gallon we are definitely going to have to be thinking more about transportation and access, and less about cars per se -- at least as we always have in the past. 

A lot of ideas come to mind as to how to deal with this, but since most of them are kind of unfamiliar, we're probably going to need some help in developing basic organizational and even legal support in order to make them work.

Here are a couple to think about which would be important for us and for many people who lived in small towns and rural areas across America: 

1. We don't have very many taxis around here, and the ones we do things  To cost a lot. But if we can figure out how to get more people into the taxis so as to drive down the costs and at the same time put more of them on the road, well that might be the start of something interesting. 
   

1. Much in the same spirit, we have a lot of people who have both cars and plenty of time on their hands to serve as informal but still effective taxi.  If we could only organize to find a system to make this work. 

1. We used to hear something about car and van pooling which was used by some of our local industry employers, back when we had still local industry. That has to be an idea we could revisit, both for getting to work and for other important trips as well. 

1. Likewise we have a fair number of church and school buses in the county, most of which sit around empty 95% of the time.  Surely we can do something more with them.  
   

1. And then what about working out some things where people want to share a car when they need it, and not have to pay the full expenses involved in owning and operating your own car. 

1. There is almost no provision for cycling in this area, and there surely have to be some interesting things we could do to encourage and support this form of low-cost healthy transportation. That plus better and safer sidewalks and other protection for people who want to walk.
   

1. We used to walk a lot before we started to depend on cars, and I know there are a lot of people out here who would like to be able to do it again, if only there were a place to go to within walking distance. 

Maybe I should add in closing that we have figured out that there is more to it than just cars, transportation and the price of gas at the pump.  Maybe some of you up there should be telling us how we can get back to towns and small rural centers that offer something more than an empty street and closed storefronts. That has to be part of our solution strategy, wouldn’t you say? 

Back in the days of the War Between the States, our part of Mississippi for a long time resisted pressure to secede from the United States of America. We were and are to this day proud and independent people. But what we now need from Washington are some clear signals and a good understanding of the realities we face every day. 

We're waiting to hear from you.  And you will find that we are ready to do our part.

 

From a global perspective 

My twenty  distinguished colleagues who have already weighed in with their views and counsel on this question here have covered a lot of the most important bases for which I'm grateful.  They make a good read so no reason for me to try to cover the same terrain.

Instead, let me now take a couple of steps back from the heat of the action and share with you my thoughts on how this looks from a global and more strategic sustainability perspective.  When we step back from the stove a couple of important  things become clear: 

1. We are going to see continuous, at times violent and in any event uncontrollable swings in the price of fossil fuels in 2009 and in the years ahead.  This is the inescapable reality of the future, the New Normal. 
   

1. At no time in the past have we seen such wide, rapid and unpredictable fluctuations.  This suggests to me that whatever our future policy is, it better be very different from the past. In other words if it looks familiar we can be pretty sure that it is not going to work. 

1. So we have to know that we have to innovate and we have to dare. 

1. O'Gara It is my firm belief that this high volatility can be turned toward to our advantage if we tackle it in a sufficiently strategic and politically savvy manner. I and a thousand others have written in the past that "a crisis is a terrible thing to waste".  And since this is an excellent case in point,  I hope that we will now find a way to put our brains together to make sure we don't waste this one 

1. However unless there is a tidal change in our approach, the likelihood is that we are going to lurch from one hapless piecemeal “solution” to another and in the process show ourselves as unable to assume the responsibilities of good governance. This is no time for complacency and wait-and-see or more of the same.  I would say that we have done enough waiting and seeing for at least the next eight years. 

1. The reality is that we have all the tools needed to engage a policy based  on strategic, steady and significant increases in price at the pump. This is needed for all the reasons which my colleagues here have pointed out very well and which I therefore need not repeat, while at the same time ensuring that those who today are both highly dependent on their cars will not suffer – excessively, unnecessarily, inequitable -- from the necessary strategic price increases. 

So we know what we have to do, and that is to work out and implement a clear game plan for these steady price increases and everything that is needed to soften the edge, beginning immediately. If Europeans can live with gas at close to $10 a gallon, Americans can too.  And this can be achieved moreover without a sacrifice in life quality. 

All we need is leadership to show the way.

 Eric Britton

 

PS.  I'm reading a fine book by James M. McPherson on the leadership challenges that then-new president Abraham Lincoln faced when he arrived in Washington, DC in 1861.  The book, "Tried by War”, which I strongly recommend to you, offers a number of striking analogies to the situation and the stresses that President-elect Obama is undoubtedly going to have to face and deal with when he takes office in less than two weeks time.  President Lincoln had plenty of advisors and plenty of generals, but things began to move in the right direction only when he took charge of it himself. That’s leadership.  

You can contact the author at +1 310 601-8468 in the States or +331 4326 1323 in Europe. In either place eric.britton@newmobility.org for email or Skype: newmobility  

 

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During his career in the U.S. House of Representatives Congressman LaHood had a reputation for approaching public problems with an open and pragmatic mind.  I am confident that this attitude will translate into a willingness to consider significant reform in the transportation sector during his leadership of U.S. Department of Transportation.  Many necessary changes can only come through legislative action, but DOT can undertake administrative and regulatory changes to promote greater linkages between transportation policy, economic growth and competitiveness, energy security, and climate change. Addressing these issues, which are deeply interwoven with transportation policy areas, is essential in developing a forward-looking federal vision – and DOT can play an important role in this task.

There are a number of steps DOT can begin today to reform the system. Perhaps the most dramatic might be a reorganization of DOT’s structure along functional, rather than modal, lines. The leading example of such a departmental restructuring comes from the United Kingdom. The goal is to better align priorities, objectives, and process while reducing inefficiency and providing incentives for success. A restructuring would help clarify and consolidate the grant-making agencies within the DOT (like merging the highway and transit agencies into one) and the more regulatory-oriented agencies that deal with goals like safety. Within the limits of existing statute, the new Secretary might consider a reorganization of DOT around national goals and purposes, such as transportation in metropolitan regions, major trade and goods movement corridors, and intercity passenger connectivity.  In addition, the new Secretary might undertake – again, within existing law – a consolidation of the Department’s regulatory activities that deal with goals like safety.

DOT can lead in other areas as well. In focusing on energy security and environmental goals, Cong. LaHood, as Secretary, should begin the process of further increases in CAFE standards for all classes of vehicles and should direct DOT’s operating agencies to develop guidance to state, local, and metropolitan agencies that will encourage genuine strategic transportation planning and linkages between transportation, economic growth, energy, and climate change at those levels. To improve operations DOT can take action to enhance the role and capacity of the Bureau of Transportation Statistics to collect data critical to insuring performance and accountability; without better data it is hard to develop accountability much less set goals. DOT can also move to put a greater emphasis on operating improvements and restoration of existing assets and, to the extent possible under existing law, using DOT programs and authority to allow state and local governments to utilize pricing in the management of systems. 

Even if all of these goals cannot be fully accomplished in the next few years, a DOT focused on opportunistically moving the ball forward when possible will help to ensure that critical long-term concerns are advanced.

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Jon Martz, President of the Association for Commuter Transportation (ACT), offers the following comments: 

The freedom of mobility is a cornerstone upon which this nation was built. America’s waterways, railroads, highways, and transit systems have allowed its citizens to travel freely for centuries. Our economy has depended upon the ability of getting product to market quickly and efficiently. Some fifty years after the construction of the interstate highway system began; these freedoms are being challenged by congestion. This dilemma is no longer exclusive to large metropolitan cities. Congestion affects almost every aspect of our lives from the air we breathe, to the amount of time we spend with our children, to the cost of getting to and from work.

The challenge facing Congress is how to maintain a high level of mobility while addressing the pressing problems of energy security, global warming, and maintaining a robust economy. The Association for Commuter Transportation (ACT) urges Congress to design a new guiding vision that not only works to expand the current transportation system, but also works to get the most out of what has already been built.  ACT believes that the next authorization should be created using these guiding principles:

 

ESTABLISH A NEW VISION AND FEDERAL TRANSPORTATION POLICY THAT ALTERS THE WAY THE FEDERAL GOVERNMENT ADDRESSES THE CHALLENGE OF TRANSPORTATION AND THE WAY CURRENT STAKEHOLDERS UTILIZE FEDERAL RESOURCES – Capital expansion has been the focus of federal transportation policy for the past sixty years. This paradigm is rapidly changing and while there is need for additional capital support of current infrastructure, there is increasing need for broad based support for an extensive range of new strategies including transit, demand management, pricing, and enabling freight mobility. It is unreasonable and economically unsustainable to continue along a path where singular support of capacity expansion is the primary focus of federal transportation policy. The next federal transportation authorization should set a new course that not only alters federal policy to focus on optimizing existing infrastructure and managing demand first, but guides states, regional planning bodies, and local governments to follow a similar course.

ALIGN FEDERAL TRANSPORTATION POLICY WITH FEDERAL TAX, ENERGY, AND ENVIRONMENTAL POLICIES – Federal transportation policies must align with other federal policies including energy conservation and environmental sustainability. Congress has recently passed energy conservation legislation; however, federal transportation policy promotes the opposite by basing federal highway apportionment on rewarding states with higher vehicle miles traveled (VMT). This formula is unsustainable in the long term given decreasing VMT with rising fuel prices and a federal mandate for more fuel-efficient vehicles.  Additionally, funding formulas based upon fuel consumption is environmentally counterproductive. A truly effective, unified framework for transportation, energy, and environmental policies would point the way to maintaining a high standard of mobility for people and commerce while being most efficient in energy use, reducing greenhouse gas emissions, and promoting sustainable growth patterns.

INCLUDE ALL CUSTOMERS OF THE TRANSPORTATION SYSTEM BY ENGAGING OTHER STAKEHOLDERS, SUCH AS EMPLOYERS AND TRAVELERS, IN A WAY IN WHICH PREVIOUS FEDERAL TRANSPORTATION POLICIES HAVE NOT – Addressing congestion will require engaging stakeholders in the transportation system as peers and leveraging tactics that have previously been overlooked by the federal government. Federal policy must recognize and connect with users of the transportation system. This can be accomplished by involving new stakeholders such as employers, developers, and commuters while also incorporating policies and programs that aim to encourage more efficient use of the existing system.

FEDERAL TRANSPORTATION POLICY SHOULD BE PERFORMANCE-DRIVEN ESTABLISHING BASIC AND DEFINABLE METRICS BASED UPON EFFICIENCIES AND OUTCOMES; COMMUNITIES THAT ACHIEVE OR EXCEED DESIRED OUTCOMES SHOULD BE REWARDED WITH ADDITIONAL RESOURCES – The new vision for federal transportation policy should have clear, attainable goals, measured by identifiable metrics, and guided by cost-effectiveness. These metrics should include mobility, congestion relief, air quality improvement, safety, and energy conservation. Funding apportionments should be based upon the success or failure of areas to achieve these outcomes, and those communities should be rewarded for meeting and exceeding these goals.

ACKNOWLEDGE THE DIFFERING TRANSPORTATION NEEDS OF URBAN AND RURAL AREAS AND PROVIDE METROPOLITAN AREAS ADEQUATE RESOURCES TO ADDRESS THE CHALLENGE OF CONGESTION IN URBAN AREAS – The needs of urban and rural areas differ drastically. Congestion in ‘mega-regions’ is creating chokepoints for freight movement and personal mobility; it is important that federal policy provide metropolitan areas adequate resources and tools to address the challenge in urban areas. According to 2005 figures, in certain metropolitan areas the average rush hour driver loses as many as 60 hours per year in travel delay, amounting annually to a “congestion tax” of approximately $1,200 per rush hour traveler in wasted time and fuel. Congestion in urban areas has an impact in all parts of the nation and those areas should be given the resources and tools to address the challenge.  This is critical to the growth of our nation’s economy as well as regional sustainability.

ENCOURAGE INNOVATION THROUGH INCREASED FEDERAL FUNDING FOR TRANSPORTATION RESEARCH, TRANSPORTATION EDUCATION, AND INFORMATION DISSEMINATION AND TECHNOLOGY TRANSFER – Like any successful enterprise, breakthroughs require significant investments in education, research, and development to rethink approaches, uncover opportunities, and invent the future.  We are no longer able to focus on “building it”; we now must plan, maintain, and operate the entire transportation system better. Federal policies should inspire and fund improvements to better system performance, help foster the evolution of products and services, create new products and services, and promote cooperative efforts among the academic, public, and private sectors in pursuing new ideas that seize on the opportunities offered by changes in demographics, technology, society, and the economy.

 

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At the precise time when the nation desperately needs to prioritize its limited investments and resources, the federal transportation program has lost focus. Our response has been mostly to keep throwing money at the problem, without any meaningful attempt at policy reform. Federal transportation funds are distributed like peanut butter across the continent without any real purpose, targeting, or accountability.

There are several problems:

First, for the vast majority of the program the federal government is absent where it should be present, lacking any overarching national vision, goals, leadership, or direction.

So unlike our competitor nations—who have both national freight policy and national passenger rail policy, and do not expect their major ports and hubs to go it alone—the U.S. government is absent by failing to focus on these areas of national priority.

Second, our federal transportation policies are outdated, and still not attuned to the needs, problems, and challenges of metropolitan areas. For one, federal transportation policy continues to assign states the primary role in transportation decision making. Metros still only receive 6 percent of the federal highway allocations directly.

Federal transportation dollars continue to be distributed to its grantees based on archaic funding and equity formulas. There is no reward for reducing the demand for driving, nor overall spending. In fact at the same time Americans are seeking to drive less due to energy and climate concerns, the federal formulas reward CONSUMPTION and penalize CONSERVATION.

The federal highway and transit programs operate on an unlevel playing field. While projects using highway dollars are subject to only perfunctory review and enjoy a federal funding contribution of 80 or 90 percent of the project, transit projects are subject to an intense, hypercompetitive bureaucratic process and a federal contribution of less than half of the project cost.

The result is that while the nation built enough rail to stretch from Alaska's Bridge to Nowhere to the London Underground over the last 20 years, we also managed to construct 132 thousand miles of additional roadways – enough to circle the globe more than 5 times.

Third, the lack of a 21st century approach to government means the federal transportation program is underperforming and failing to maximize efficiencies.

There is almost no focus on outcomes or performance. So at this moment of transportation crisis, billions and billions of federal transportation dollars are disbursed without meaningful direction or connection to advancing national interests. Earmarks and special interest giveaways have replaced and trumped any unified national purpose. While it may appear there is some concentration due primarily to our congressional districts, only about half of the total funding from these earmarks goes to the 100 largest metropolitan areas.

Equally disturbing is a pervasive lack of fact-gathering and analysis across the transportation program. Federal agencies do not collect, or analyze sufficient information about the system, and the grantees conduct little or no performance assessment on the results of the hundreds and hundreds of billions in spending. We can't manage what we can't measure!

So taken together our country’s transportation program gives a blank check and hopes for the best. The problem now is that there's no more money left in the bank account.

Just recently, Washington shifted $8 billion dollars from the general fund to cover a massive shortfall in the highway trust fund. Whether or not that's going to last until the end of the current authorization is anyone's guess.

This is not hard to understand. The federal gas tax—which generates the vast majority of the federal transportation revenue—has not been raised in nearly 20 years even to keep pace with inflation. And as Americans are driving less and driving more fuel-efficient cars …. we're all paying less into the account as well.

But this critique is much deeper than not having enough money. Not only do we have a system that’s BROKE we have a system that is BROKEN.

So my final point is that federal policy needs an extreme makeover.

If our transportation program is going to achieve critical national objectives in an era of fiscal constraints it is going to need to focus and prioritize. The nation should settle for nothing less than evidence-based, values-driven decision-making.

To echo a common theme articulated by the national transportation policy and revenue commission – as well as several others – we need a new beginning.

So we have proposed a three-pronged strategy for our national transportation program:

FIRST, the federal government should LEAD in those areas where there are clear demands for national uniformity or else to match the scale and geographic reach of certain problems.

We must define, design, and embrace a NEW, UNIFIED VISION for transportation policy. The focus should be on investing in infrastructure that supports the competitiveness and environmental sustainability of the nation rather than on funding individual states or spending on singular needs.

Congress should authorize a permanent, independent body—a Strategic Transportation Investments Commission—to prioritize federal investments in carrying out that national vision. It would address nationally significant questions such as:

• Where are our most critical bottlenecks on the interstate system?
• What kind of investments should be made in our national gateways?
• Which corridors need attention for a true passenger rail system?

SECOND, while there are clearly areas of national scope where the federal government should lead, there are other areas where the federal government should get out of the way and EMPOWER states, metropolitan areas, and local governments to innovate.

In this regard, the largest metropolitan areas should be given much greater funding and project selection responsibility. Metropolitan entities need real authority and real resources in order to bring local officials to the table and make real decisions.

But beyond money, metros need a broad strategy of "modality neutrality" that establishes equal treatment of highway, transit, and non-motorized projects. This is a lesson from the U.K. that empowers decision-makers to evaluate all projects on their ability to deliver cost-effective benefits by the best means available not through the rules or funding silos assigned to a particular mode.

We also need to fully embrace market mechanisms and establish a national policy for road pricing. There is ample evidence around the globe to show that these strategies can effectively address congestion and maximize the use of scarce roadway space—especially in dense metropolitan areas such as London, Stockholm, and Singapore. We also need to assist metropolitan entities in engaging in public/private partnerships as a way to insert market discipline and private financing in the system.

The federal government also needs to assist states and metropolitan areas in developing truly integrated transportation, land use, and economic development plans to serve the projected growth over the next several decades. Sustainability Challenge Contracts should be awarded competitively to entice states and metropolitan areas to devise their own visions for the future.

The THIRD strategy is for the federal government to MAXIMIZE—not just its own workings— but that of its partners to optimize metropolitan prosperity.

In order to rebuild the public trust, we have to fix what is broken and tie the federal program to a tangible set of outcomes and performance measures … and we need to hold the grantees accountable for meeting those goals.

The federal government should replicate the intricate web of data, metrics, analytic tools and spatial planning techniques now routinely deployed by Germany, Britain, Denmark, and other European nations so we can make decisions based on fact rather than political horse trading and measure our progress towards clear national priorities. We need to get more strategic, and more disciplined. Building it smart can also mean building it small.

Yet in order to commit to such an evidence-based program we need to build a world-class data and information system – call it "TranStat' –make it transparent …. and make it accessible.

Then we need a frank conversation about transportation finance. But it must be about INVESTING rather than SPENDING. So after reform measures are put in place, all options should be on the table:

To LEAD in the funding of projects of national significance the federal government should act as a guarantor of debt and create a National Infrastructure Bank to finance projects of true national priority.

To EMPOWER states and metropolitan areas, the federal gas tax should be raised. Yet given the myriad problems and challenges here the nation should not be tethered long term to the fuel tax for transportation revenues.

So the federal government should also provide stronger incentives for the adoption of market mechanisms like congestion pricing to MAXIMIZE metropolitan road networks, as well as the expansion of a range of user fees.

However, these ideas should not preclude a comprehensive and inclusive discussion about transportation—a discussion that includes accountability, overall intent, and connection to broader goals of economic growth and personal mobility.

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As I see it, the next transportation bill should be a new beginning in our nation’s transportation policy. It should be a bill of bold vision and recognition that transportation is a key facilitator of our economy and our citizens’ quality of life. Here are five priorities that I believe the administration should consider in creating the next bill: 

Be bold. Think big. Out of crisis comes opportunity. We have the opportunity to align transportation policy goals with other important policy goals of our nation. Specifically, the next transportation bill must consider national transportation policies in light of climate change and energy policies, just as climate change and energy legislation must align with transportation. The President-elect has already focused on some of the key issues such as green energy, a new fleet that is fuel-efficient or electric, more rail and public transit. The new transportation authorization presents Congress with a once-in-a-generation opportunity to think through these issues. It is critical that we think big about the big picture. 

Create more modal balance.  Intercity passenger rail must be part of the next bill. States want to work proactively with the federal government to develop our passenger rail network for the 21st century, but we need a federal partner that will link our state rail plans into a national rail vision. By partnering, we can be smart about using the our financial resources to assess where passenger rail service will be most effective in relieving airport and highway congestion and reducing the transportation sector’s greenhouse gas emissions. In addition, we need a national vision to assess where conventional rail is needed and where high speed rail is most important. The National Surface Transportation Policy and Revenue Study Commission began the conversation on our national rail network vision. The next authorization bill must make it real. 

Increase funding. It may bethat the truest words in the National Commission’s report were, “There is no free lunch.”   In the Commission report, we outlined the needs: we currently spend $90 billion on transportation and the needs approach $350 billion. We heard from almost all who attended meetings or testified at our field hearings that more resources are needed for transportation. 

We spend a lower percentage of our Gross Domestic Product (GDP) on transportation than our global competitors. In the short term, the National Commission recommended several approaches to increasing revenues.    Longer term, we need to assure that climate change revenues are used for transportation projects that reduce GHG emissions, like rail and transit. The next bill needs to test - in various regions of the country - a pilot for replacing the fuel tax. Any approach considered should be judged against criteria including fairness, ease of collection, a user-pay principle and low administrative overhead costs. 

Finally, private investment in the transportation network has always existed. In our country, we have varying degrees of private investment among the different modes. However, we must carefully consider how we protect the public interest in public private partnerships. P3 deals have run into significant public opposition, just like tax increases, and the current credit crisis will likely have a chilling effect on private investment in the near term. In the end, private investment should not be viewed as an ongoing revenue source for the upkeep and improvement of our transportation network.

The focus should be mobility, not necessarily congestion. While policy changes that focus on reducing congestion should be part of the next bill, we must keep our national network perspective. What transportation solutions will improve the lives of our citizens? What is the best approach to our long-term freight needs? Mobility options should be available to everyone – whether they work or live in Wausau, Wisconsin, or Miami, Florida. Different states have different challenges. We must apply the right mode decisions to these issues. The next bill should allow states to choose transportation solutions based on state mobility goals, not federal funding sources. 

Make sense of the project delivery programs in all modes. We need to think through how Washington D.C., the states, and local governments work together to deliver our transportation projects. There is an opportunity to make significant program changes that will allow those of us who deliver transportation projects to do so in a much more sensible and transparent manner. I would encourage a fresh approach to program delivery – if programs are not well focused or if they are unproductive, let’s think of a new approach that combines programs toward an outcome, rather than silo funds and project management that creates barriers to sound project delivery. 

The Governors, the new Congress, and the President-elect are beginning to talk through the pieces of an economic stimulus bill. Wisconsin Governor Jim Doyle fully supports this initiative. The stimulus bill will be the first opportunity for us to support the nation’s efforts to get people back to work. The funding and policy decisions we make in the next authorization will keep them at work and will offer future American generations the same promise that we were offered by policy makers in the middle years of the last century.

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 While this discussion on the surface transportation law is interesting and important, I would like to draw your attention to a serious infrastructure problem that has reached a critical mass - our nation's runways and airspace.

There's other reauthorization business on Capitol Hill to attend to, namely the Federal Aviation Administration reauthorization bill, which was passed by the House in September 2007 but left unfinished by the Senate after a lengthy and frustrating succession of extensions and delays.

NATCA, which represents FAA air traffic controllers and several thousand other FAA-employed safety professionals, would submit that passage of this FAA bill should be given strong consideration for the title of "most important task" by the next DOT secretary.

While the next generation air traffic control system -- under even the most optimistic prediction -- is more than a decade away, work must be completed sooner rather than later in the next Congress to kick-start critical modernization efforts that will strengthen the infrastructure of todays aviation system, while building our the system of tomorrow. The failed FAA leadership of the past six years has weakened our aviation infrastructure, left modernization projects delayed and continually re-baselined, and completely shut out air traffic controllers and other stakeholders from the process of making our system safe, efficient and cutting edge. We view the incoming administration and 111th Congress as the perfect confluence of events to usher in a fresh chance to get the FAA bill done, bring ALL stakeholders into the discussion and finally offer the delay-weary American traveling public some hope that we can move our system into the 21st century once and for all, with a workforce of safety professionals who are treated fairly and with respect instead of shunned as an enemy as the current administration has done.

NATCA not only supports modernization but demands it. We led an effort last year to urge passage of FAA reauthorization, bringing together over three dozen members of the aviation and transportation communities on a joint letter that underscored the importance of this legislation.

We look forward to working with the new administration in a collaborative fashion and being part of the solution to the many problems in the FAA.

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1) Rebuilding rail: More than 100,000 miles of rail mileage have been lost since 1965, leaving us with an intercity rail system less than half the size of our interstate highway system. This is alarmingly poor footing for a nation burdened with a dangerous oil addiction and a global warming challenge. Rail mileage should double so that it is on par with the highway system, and the next bill should put us on the right course to get there.

2) Rewarding performance: We need strategic investments based on national objectives. Regions, states and the federal government should drive investments by adopting aggressive mode share goals for oil-efficient, low-carbon options such as public transportation. The scale-up would be similar to that required in many states for renewable electricity. Call it an "Oil-Saving Mobility Standard," helping unshackle consumers from the gas pump.

3) Reforming governance: Congress should empower metropolitan areas, where two-thirds of people and three-quarters of economic activity are located. California sends three-quarters of its federal transportation assistance directly to metropolitan areas; other states must do the same to ensure this aid gets the most bang for every buck. 

4) Recovering economic prosperity: The upcoming stimulus bill should tee up a transportation bill that helps (not hinders) the mission to get off oil and cut global warming pollution via an equal split between highway and transit investment. That's a change from the 80-20 split, an antique deal (1982) that applies to gas tax revenue, not the general fund. A 2004 study found that highway repairs yield 9% more jobs per dollar invested, and transit yields 19% more. And with VMT down 79 billion miles from last year as of September and transit more than 3% higher than last year as of June, Congress should send at least half of the money where it's needed most: Transit.

5) Resolving revenue questions: What comes to mind about the last transportation bill? Waste: The bridge to nowhere. The gas tax has been frozen for fifteen years in part because Americans have lost faith in the program. One that saves oil, cuts pollution and creates good jobs would be marketable to a skeptical public. Then ways of financing projects  (such as tolling, congestion pricing, and value-capture from new development) and enhancing revenue (higher gas taxes, a road-usage fee system, vehicle sales taxes) are worth consideration. But addressing the price tag before designing a program worth the money would be putting the cart before the horse.

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As the biggest metropolitan region in the country, here are some things the Port Authority of New York and New Jersey believes the U.S. Department of Transportation should consider in drafting this key piece of legislation.

First, accelerate federal approvals and funding support for selected projects. The Port Authority has identified the need to upgrade and expand existing mass transit systems as a key priority to allow the region to keep moving. The federal government must recognize the national benefits that an improved mass transit system will provide, and to authorize sufficient funding for key projects in this area, including Access to the Region's Core, the construction of Moynihan Station to provide additional rail station capacity in midtown Manhattan, and the Cross Harbor Goods Movement Program.

Second, support strategic investment in intercity passenger rail service.  A more efficient transportation system requires that intercity rail continues to play an important role. For that reason, additional investments must be made to allow upgraded passenger rail service on the Northeast Corridor and other markets converging on New York's Penn Station. 

In addition, higher levels of investments are needed for Amtrak service in the region and nationally to remove some of the strain from the nation's Aviation system, especially the short-haul air passenger market.

Third, establish national freight policy goals. The critical mission we face to make sure billions of dollars in goods move freely through the region is a continuous challenge. The Port Authority has taken on that challenge by investing substantial dollars in rail at our ports to improve regional mobility, but we cannot operate in a vacuum.

We believe a national policy is needed that would include aid to the states to improve ground access to major maritime, air cargo and intermodal rail terminals. We also believe there may be a need for a national freight facility charge to provide a dedicated funding source to supplement local capital investments in goods movement improvement projects.

In addition, targeted investments must be made in aging infrastructure that can impede the free-flow of cargo throughout the region. On such project we face is the need to deal with the Bayonne Bridge, which spans a critical shipping channel but has a low clearance for ships that will impact the ability of new, larger vessels from calling on the port. We believe this is a national policy issue given the critical role that New York's maritime business plays in the national economy.

Fourth, advance efforts to promote interoperability of toll and fare collection systems.   Improving regional mobility in the New York-New Jersey region and in the areas that surround it also require states and tolling agencies to work together to standardize operations.

The federal government should strongly support these efforts to assist tolling agencies to better integrate their operations, which will improve productivity, customer service and revenue collection.

Finally, encourage comprehensive action to improve metropolitan mobility. Maintaining an efficient national and state highway system is essential to maintaining the efficient movement of people and goods. Some of the strategies that the federal government can help support on a national scale are value pricing and joint planning in multi-state metropolitan regions.

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1: Simplify transportation goals and eliminate unnecessary mandates, programs and processes. 2: Level the playing field among highway, rail, transit, and demand management solutions. 3: Increase federal funding for transit/rail, highway/bridge and private partnership initiative. 4: Reward performance-based regional planning for both transportation and land use. 5: Ensure that federal funds are predictable and reliable.

 

1. In approaching the new highway bill, the incoming Transportation Secretary should conduct a thorough assessment of the infrastructure needs of the nation.  This should be both a short-term and long-term assessment.
2. A key part of this process is to identify mega projects of national significance, with an eye toward multi-modal projects. 
3. Identify funding sources for the bill and be prepared to play a leadership role in debating our options.
4. Work with congressional leaders, governors and mayors on the legislation.
5. Communicate our transportation needs and the benefits of transportation investment to the American people.  This is critically important.  In recent years, we have touted the benefits of infrastructure investment in other countries but have underfunded our own transportation network.  Our economy depends on being able to move products efficiently and safely, and the new Secretary must be a strong advocate for maintaining and improving our infrastructure. 

I’d like to make three points that I believe should be priorities of the incoming Secretary of Transportation during next year’s reauthorization process.

First, we must develop a clear national strategy to address the nation’s transportation needs: a National Strategic Transportation Plan.  Not since President Eisenhower launched the Interstate system have we had a strategic vision for transportation that is national in scope.  We need that same kind of vision today for a similarly comprehensive approach and a long-range strategy that incorporates all modes of transportation.  A National Strategic Transportation Plan should be a priority for the new Secretary.  Such a plan will provide a structure for how to best utilize our limited resources and will serve as a document that justifies a unified vision for investing in all modes of transportation. 

Another priority for the incoming Secretary should be streamlining the lengthy process by which transportation projects are approved and constructed.  Transportation projects can get bogged down for 10 years or more in bureaucratic red tape.  This process unnecessarily wastes valuable resources, and we can do better.  For example, after the I-35W bridge in Minnesota collapsed in 2007, the replacement bridge was contracted to be designed and completed in just 437 days.  Adopting the same kind of approach with similar projects – a 437-Day Plan – would cut red tape and lower costs dramatically, and we can do this in a way that protects the environment. 

Every mode of our transportation system is under-funded and we can’t keep up with capacity demands.  With motorists driving less, and the increase of alternative fuels and fuel efficiency, the gas tax is becoming more obsolete by the day.  We must find new and better mechanisms to finance our critical infrastructure.  Government funding will always play a major role in infrastructure financing, but we also need to draw from the experience, creativity and efficiencies of the private sector.  Private sector–public sector partnerships are common around the world, but the United States is relatively new at leveraging private sector financial resources for transportation facilities and systems.  We’ve got to take advantage of available private sector capital in a way that is responsible to the taxpayers.  We should also find better ways to leverage our existing federal transportation revenue streams, through bonding and other creative financing tools.

New ideas are absolutely necessary in the next reauthorization if we are going to address the critical issue of our deteriorating infrastructure and get the nation’s economy moving again.

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The Next Surface Transportation Bill Must:

1. Match the size of America’s transportation needs

Transportation needs are bigger than ever in our nation’s history – but the Transportation Bill as it has been constructed cannot meet those needs. Due in part to past neglect and misplaced priorities, surface transportation needs now exceed $500 billion over five years, which is nearly twice the largest authorization ever in the Transportation Bill. User fees, such as the gas tax or even potential taxes on carbon emissions, will continue to be part of the mix in the future, but they will become a smaller share of resources under a progressive energy policy.

We must question whether resources for such a basic necessity should be left to user fees, just as we would question if police protection, basic education, emergency health care or other fundamentals should be left to user fees. And while there may be a role for private investment, renewing our transportation system cannot equate to selling off national assets; PPPs, or public-private partnerships, cannot mean “picking the peoples’ pockets.” To match the size of America’s transportation needs, the next Secretary of Transportation must advocate for other stable, reliable investment sources, such as dedicated capital expenditures and direct Treasury funding.

2. Underscore the golden opportunity to create good jobs

The Transportation Bill can help build America, so America works. By meeting surface transportation needs, we can put hundreds of thousands of men and women back to work, providing families and communities with the steady paychecks needed to get our economy on track. None of these jobs can be shipped overseas, and all leave behind real assets for the American people. The Transportation Bill must continue to ensure that federally funded jobs are good jobs, with family-supporting Davis-Bacon provisions to prevent taxpayer money from being used to drive down local community wages and standards.

3. Be a mechanism to improve people’s daily lives

Transportation must be functional and accessible if our economy and society is to be just and equitable. Accessible transportation is a necessity for survival in today’s economy. Transportation policy should help rebuild our transportation systems so they work for both business and workers. Currently the typical American commuter spends more than $1,000 in wasted gas trapped in traffic jams. A fourth of the bridges we cross are below standard, a third of our roads are in less than good condition and while demand for mass transit rises, the investment gap grows with many major transit systems borrowing funds simply to maintain operations. In addition, user fees should be examined to ensure that working Americans, often long distance commuters and the biggest users of mass-transit, are not unfairly relied upon to support the system.

The next Secretary of Transportation must use the Transportation Bill to highlight our nation’s needs and help build the political and public will for change by showing America a new vision of how to take care of and improve our transportation systems. A place to start would be to name the bill in a way that tells Americans why this bill is important and how will improve their lives and the economy – perhaps the Build America, so America Works Bill. If we ask Americans what kind of country we should be – one falling into decline or the country with the best, most competitive transportation system in the world – they will choose to be the best and be willing to pay for it.

4. Strengthen the federal role in transportation policy

States no longer have the capacity to match resources under current formulations. Too much is at stake to forgo crucial projects due to the lack of state resources. The next Secretary of Transportation should advocate for a stronger federal role that helps states better fulfill their role. While states will always play a pivotal role in transportation policy, today’s economy calls for a larger federal role in investment so that states can carry out their role. In virtually every state, crucial projects are shutting down due to lack of funding; the federal government can and should prevent projects in states across America from shutting down.

5. Be a tool to help America compete globally

As developing nations move ahead with transportation systems, America is falling behind, unable to move products or people efficiently enough to compete in tomorrow’s global economy. The next Secretary of Transportation must help America understand that the Transportation Bill can be a tool to help America compete. While our transportation system decays, emerging nations are racing to build state of the art transportation systems. China and India, for example, invest four times what America does as a share of gross national product.

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Refocus, reform, restructure and refinance the nation’s federal surface transportation program.  That should be the top priority for President Obama, the new U.S. secretary of transportation and all stakeholders involved in the 2009 highway/transit investment bill.

The American Road & Transportation Builders Association (ARTBA) (link) has a detailed plan (link) to achieve this goal. Here’s the refocus part:

First, let’s really do something about traffic safety.  Forty-two thousand deaths a year and the $230 billion toll on the American economy caused by motor vehicle crashes is a national disgrace.  Motor vehicle crashes are the number one cause of death and permanently disabling injuries for America’s children.  Part of the problem is we’re using the wrong metric for “success”—deaths per vehicle miles travelled, rather than a net reduction in the total number of deaths and injuries each year.

As a nation, with federal leadership, we’ve aggressively addressed vehicle crashworthiness, seat belt usage and drunk and drugged driving behavior.  Now it’s time to aggressively address the fourth leg of the stool—infrastructure, technology and hardware capital improvements that make the physical roadway environment more forgiving and safer.  This is a public health crisis that demands a new paradigm.

Second, let’s protect and improve the transportation infrastructure capital assets that American taxpayers have already invested hundreds of billions of dollars developing.  The backlog of needs just to maintain the current highway, bridge and transit network is enormous.  Let’s use the most efficient mechanism available to get this and the overall safety components of the job done—the federal gas tax.  At least a 13 cents-per-gallon increase, indexed to inflation, is needed for “core program” investments.

Third, our entire transportation network is “capacity deficient.”  It is increasingly unable to meet the demands America places on it to compete in a growing global economy.  We need an intermodal, regionally-developed, U.S. DOT led, strategic national business plan to add the new capacity necessary to handle the incoming “freight tsunami.” 

We call it the “Critical Commerce Corridors”(3C) (link) national freight movement program.  Let’s finance the 3C with new, freight-related user fees—not the gas tax.  We can start by attacking the more the 200 freight bottlenecks that have already been identified by the U.S. DOT.

Build measurable performance and accountability metrics into these priority areas to restore the public’s confidence in the program.

We could jump-start all three of these national priorities as part of an economic stimulus package early next year.  Unlike some other, transitory, stimulus initiatives, transportation capital investments create tangible assets that will continue to provide public benefits and facilitate American economic activities for years to come.

In closing, a few words about the federal gas tax (the elephant in the room)…

The gas tax mechanism isn’t “broken.”  The federal gas tax rate is broken.  It hasn’t been raised since 1993!  Fifteen years of inflation and increasing labor and materials costs have reduced the purchasing power of the 18.4 cents-per-gallon gas tax to only 11 cents today.   If you hadn’t gotten a salary increase in 15 years, you’d be in the hurt locker, too!

Is the gas tax “sustainable” in the short-term?  Every objective observer, including the Transportation Research Board, says “yes.” 

Let’s not forget that federal CAFÉ standards have been around for almost 40 years.  Have they impacted trust fund revenues?  Sure, very slowly.  This year, even with the shock of an enormous gas price spike and a dramatic slow down in truck sale revenues and fees caused by the economic downturn, revenues to the Highway Trust Fund will still total about $31 billion.  (The trust fund is not “broke,” either.) 

Why is it, then, that some who know better, started the “unsustainable” drum beat a couple of years ago?  Do they believe every American household is going to abandon their cars and SUVs and buy Prius-type vehicles over the next six years?  I don’t think so. 

Yes, we need to start transitioning to a carbon tax or vehicle miles traveled user fee, or some other fee mechanism to capture value from use to ensure that as the composition of the American motor vehicle fleet becomes “greener,” the Highway Trust Fund doesn’t become “leaner.”  And perhaps we should move to using new communications technologies to “bill” motorists for their road use.  Let’s get those wheels in motion for the future in the next authorization.

Tolling, bonding, congestion pricing, leveraging and other “innovative financing” mechanisms also all can—and should—play a role in providing the revenue stream necessary to meet our future transportation needs—particularly for large-scale projects that add new capacity.

But at the end of the day, the gas tax mechanism is a lot like the wheel.  Both are old and neither is viewed as “innovative” or “exciting.”  The funny thing is, they both do their jobs extremely well.  

Raising the federal motor fuel tax rates can—and should—be done.  All that is required is political will at both ends of Pennsylvania Avenue.

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Top Priorities for the Surface Reauthorization. Interesting to see the common threads running through the comments.

1.  Need an explciit and lucid articulation of goals, objectives, and purposes of the surface program. Beyond just redistribution of $ to States.  Also, as the stimulus package emerges, we need to make a concerted effort to ensure that the transportation $ are understood to be for purposes beyond the provision of jobs.

2. Establish coherent set of performance measures for surface $.

3. Much more robust funding levels. This is a national domestic priority and linked so directly to the economy and productivity. We spend so easily in the defense and foreign relations arena, but seem parsimonious in the transportation field. Would recommend that a significant amount of the funding increase be targeted as seed $ for an "Infrastructure Bank" and a streamlined TIFIA program, albeit I recognize the devil will be in the details.

4. The $ available for intermodal connectivity should be enhanced significantly.  Better integration and focus on freight movements is a must.

5.  Reauthorization should devote attention to the establishment of clear public interest/public policy principles as guidance for public-private partnerships of public infrastructure. P3s can and should be a part of a funding construct surface projects in appropriate circumstances, but we need a more coherent set of governing public policy principles.

 

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1.      Refocus the federal program on truly national issues. It is widely acknowledged that the federal surface transportation program has evolved into a sprawling public-works program, with no real purpose. As Secretary Peters and others have suggested, it needs to be refocused on a few specific national priorities. My candidates are ending serious urban traffic congestion and ensuring efficient, high-quality interstate and international goods movement. How much the federal government should spend depends very much on how the federal role is defined. This refocused role would cost no more than the current, unfocused role, but would put a lot more resources where they are most needed.   2.      Strengthen the user-pays principle. Our highway system was built on the very sound principle of user-pays. But over the last several decades, increasing diversions of fuel tax monies to numerous non-highway purposes have significantly weakened that principle. While the viability of fuel taxes as the principal funding source is declining, for the intermediate term, we should reduce and ultimately end diversions to non-highway use, while supplementing them with increased use of tolling and congestion pricing. Those who favor federal spending on other forms of transportation, such as high-speed rail, should either figure out new forms of rail-user fees or propose supporting such projects out of general tax revenues.   3.      Don’t mix energy and greenhouse-gas policy with transportation. We all want increased energy efficiency and reduced CO2 emissions. But the fairest and most efficient way to reach these goals is with economy-wide taxation of carbon, not by micromanaging individual sectors such as transportation. A carbon tax of $X per ton will send the right signals to industry, consumers, and innovators to reduce the carbon-intensity of energy use. With such a system in place, further measures such as subsidies to specific propulsion sources (e.g., fuel cells), much less schemes to re-orient land use in “transit-friendly” ways to discourage driving, would be overkill. The mantra should be: reduce CO2, not VMT (vehicle miles traveled).   4.      Encourage private investment in transportation infrastructure. It’s a very fortunate coincidence that just at the time when we need to invest untold additional billions of dollars in rebuilding and modernizing our transportation infrastructure, the global capital markets have created several hundred billion dollars worth of infrastructure equity funds. These funds are seeking good projects to invest in worldwide. They will do this in those countries and those states that create investment-friendly climates. Congress can help by removing the remaining federal obstacles to tolling, by eliminating the cap on Private Activity Bonds for transportation projects, and by resisting the desire to regulate public-private partnerships—an area already being handled responsibly by the states.   5.      Eliminate earmarks in transportation. Enough said.

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It is difficult to deny the five most important items in the new transportation bill will be funding, environmental, freight system, safety and reorganization of the program.

But there is one more item that hasn’t been mentioned that I think rises to the rank of the top five—we need to change the perception of the American public, politicians, the press and business.  The publicity that followed the last reauthorization has done significant harm to this industry.  Just a few days ago, I watched a debate on a stimulus package on one of the business networks.  When asked about infrastructure the comment was about why do we want to build bridges we don’t need.  We, the industry and those that understand the underlying importance infrastructure has to this country’s future need to be the ones that set the record right.  The debate that is about to start can be the forum to make that happen.     

While the program may have strayed from its original intent, it is vitally important to reestablish the reasons to build a transportation system. Eisenhower’s vision has been met and today’s overall goals aren’t much different than his.  They are:

* economic global competitiveness, national security and quality of life  
* the ability to move raw materials to production and products to markets anywhere in the world in the most cost effective manner   
* the ability to respond to man made or natural disasters quickly, evacuate those affected and get responders in, and have the infrastructure be resilient  
* reducing commute times so that a parent can get to that important family function and has more time to spend coaching and guiding their children

The facts are known: transportation is effecting the cost of American goods both on the global market and in the American family’s refrigerator; over the past few years we have witnessed critical issues resulting from responding to disasters and evacuating those in need; we have become accepting of quality of life issues like waiting in traffic and the unacceptable number of highway fatalities we see every year.

Transportation can, and when properly planned, will meet the needs expressed above.  It will take a new plan, innovative financing and reorganization. A significant new program will create jobs, enhance our economy both domestically and globally, enhance our ability to respond and be resilient and improve the quality of life.

Visit www.HNTB.com/THINK to read more.

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1. Get More Bang for the Buck by Investing in Existing Infrastructure.  America’s roads and transit infrastructure are falling apart. Potholes and under-maintained buses and trains cause delays, reduce how long vehicles last, and risk public safety.  A focus on getting more value from existing infrastructure will improve transportation, put Americans to work now, and save money in the long run. It also can reduce health-threatening air pollution and greenhouse gas (GHG) emissions. Policymakers should:

• Rebuild the transportation system to a state of good repair and invest in systems to manage and reduce environmental harms from past transportation investments.
• Gain better performance from existing infrastructure by using proven computer technologies and pricing strategies to control traffic flow on existing roadways.
• Increase energy efficiency and cut our dependence on foreign oil by providing incentives for vehicles and fleets that demonstrate verifiable and durable reductions of GHG emissions. 

2. Reinvent Transit to Better Serve America’s Communities. High fuel prices have prompted many Americans to turn to transit — ridership numbers have increased tremendously all across the country — not just urban centers. Yet transit systems havn’t received the necessary financial support to keep pace with the growing service demand. Policymakers should:

• Increase support for transit and paratransit in cities of all sizes and in all regions of the country. Emphasize innovative but proven systems, such as bus-rapid-transit, that can deliver service quickly using the country’s existing road infrastructure. Invest in energy efficiency improvements to help transit systems cut their costs and GHGs.
• Support and coordinate social and human services transportation together with new para-transit and shared ride services. Combined with support for universal broadband access, ensure improved access for all to jobs and public services, including those in rural and exurban areas where conventional transit is uneconomical.
• Support and provide incentives for transit-oriented development to give people more options to live within easy reach of transit lines.
• Prioritize projects that yield Complete Streets and Safe Routes to Schools and transit, including sidewalks, bike lanes, bike stations, and smart traffic management infrastructure.

3. Make Ports and Freight Carriers More Dependable and Less Polluting. The globalization of the economy has led to huge growth in freight movement to and from the United States. Communities containing major seaports suffer from both traffic congestion and high levels of pollution from diesel trucks, locomotives, port equipment, and ships. Ports provide good jobs, but we need to ensure they also are clean jobs that don't poison surrounding communities. Policymakers should adopt policies that:

• Help ports build “green” infrastructure, from better rail connections to improved electric power supplies for ships in port.
• Provide incentives to help truckers shift to efficient and clean trucks.
• Support “innovation zones” at major port cities to develop clean ship, truck and rail technology for freight handling.
• Facilitate expansion of rail-freight networks to ease the connection between ports and existing freight lines.
• Open the door to innovations, such as expanded coastal shipping, that help reduce truck congestion on freight highways.
• Support investments in technology and operating efficiency that reduce pollution from vehicles along corridors of strategic significance.

4. Develop New Revenues and Environmental Performance-Based Financing.  Fuel taxes no longer generate enough revenue to keep pace with 21st Century transportation needs. Other revenue sources need to be developed. Additionally, those revenues need to be collected and spent to take environmental costs and benefits into account. Sending the right market signals will ensure that the environmental costs of more polluting transportation choices aren’t borne by society as a whole, but by the user who makes the choice. Policymakers should:

• Facilitate a transition to national road user fees to augment traditional fuel taxes. These user fees could include fees for vehicle miles traveled (VMT), local-option congestion pricing, and other similar approaches. These innovations raise important issues of privacy and equity, which federal law should address prior to implementation.
• Consider allocating a portion of greenhouse gas allowance auction revenues to transit and freight innovations that will cut motor vehicle GHG emissions targeting these in regions that seek to reduce per capita vehicle miles traveled and enhance smart traffic management
• Eliminate barriers to market-based reforms. Congress should support cities and states that seek to experiment with innovations such as congestion pricing, container fees, parking pricing and pay-as-you-drive (PAYD) insurance. Congress should remove legal and regulatory barriers to these innovations and similar practices, and end the federal prohibitions on toll charges on existing interstate highways.
• Employ container fees. Congress should consider national port-based container fees to help support investment in low-polluting, high-efficiency infrastructure.
• Guide application of public-private partnerships (PPPs). PPPs carry the risk of lowered environmental standards, lack of public transparency, and loss of local control. Federal policy should create clear rules and guidance for PPPs, so that if they are used to spur private investment and innovation, they clearly deliver GHG reductions and other environmental benefits, and don’t unduly put public funds and infrastructure at risk.
• Target enhanced revenues. New funding should be use for: (1) planning for reductions in VMT and GHG emissions, (2) rewarding innovative best practices, (3) recognizing demonstrated performance, (4) rewarding plans for timely performance, and (5) supporting front-loaded investments in early action for long-term reductions in GHGs.

Taking these actions together will give America a 21st century transportation system. We can have a transportation system that meets our needs and matches the time in which we live. For more information, see www.edf.org/transportation.

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IMMEDIATE
1. Before reauthorization is in place, unlock the economic power of “ready to go projects” with local matching funds. Both the economic recovery package and the next surface transportation law should prioritize spending that will unlock the economic power of States and regions. As an example, New Jersey and the Port Authority of New York and New Jersey have committed $5.7 billion toward a new passenger rail tunnel into Manhattan that is ready to go to construction in 2009. Once the federal funding commitment is secured, the project will create 6,000 new construction jobs annually for the next 10 years and 44,000 new permanent jobs.

SHORT TERM
2. Work with the Obama Transition Team and Congressional leaders to ensure the economic recovery package not only creates jobs, but begins to realign our transportation systems for a 21st century economy. The Obama Administration and the 111th Congress face an incredibly daunting task with the current surface transportation law (SAFETEA-LU) expiring in less than a year. Not only is SAFETEA-LU in desperate need of reform, but its funding source, the federal gas tax, is untenable over the long-term. There is a very real possibility that the infrastructure spending included in the economic recovery package will become a short-term de-facto reauthorization, delaying a new surface transportation law for a year or more. As such, I urge the next Secretary to work with the Obama Transition Team, Chairman Oberstar and other Congressional leaders to ensure the economic recovery package invests in projects that are in line with broader policy goals including reduced dependence on foreign oil, improving mobility, reducing congestion and greenhouse gases and making the U.S. economy more competitive globally.

LONGER TERM
3. Expand public transportation across the country and increase funding for transit. Improving mobility and expanding multi-modal flexibility, while reducing congestion and greenhouse gas production will require more Americans shifting to public transportation. The next Secretary of Transportation should strongly consider allocating additional resources toward the expansion of public transportation.

4. Create a truly multi-modal national transportation policy with a balanced strategy that includes railways, highways and airways. This includes recognizing the public benefit of Amtrak and that investment in Amtrak should mutually benefit the commuter and freight carriers that share infrastructure with Amtrak. Similarly, federal investment in freight rail capacity should mutually benefit Amtrak and commuter rail carriers.

5. Streamline the federal process to prepare projects for construction. Projects now take longer to plan and design than construct. The federal process to advance projects should be reexamined without sacrificing community and environmental concerns. The unnecessarily long process adds significant costs that limit the number of projects that can move forward overall and put some projects financially out of reach. The next Secretary should also consider eliminating unnecessary overlapping of the State and Federal process. Many State agencies are recognized experts in project delivery and will bring those projects to fruition faster and less costly if these duplicate efforts were removed.

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1. Dramatically increase federal investment in transportation-- so we don't have to apologize to our children and grandchildren.
2. Collapse the myriad federal funding categories into a handful of broad policy areas.
3. As part of #2 above, develop national policies for moving people and goods. For example, in Maryland we can get up to 90% federal money for airport improvements for regional aviation service from Baltimore to New York City, 80% federal money for highway improvements between the two cities, and zero federal formula monies for high speed rail service between the two cities. Guess which one makes the most sense from a public policy perspective?
4. Develop performance measures and accountability standards for the use of federal money and hold us accountable.
5. Integrate a national climate change policy into any transportation reauthorization.

Top Five Priorities for the New Secretary:

1. Provide the leadership with Congress and the entire transportation industry to establish clear goals for the federal transportation program, including surface transportation, aviation, and maritime (as well as the connections among them). With the new Administration, several pending authorizations, and trust funds that are on life support, it is imperative that we understand where we want to go. Today there is not a consensus on first principles.

2. Identify new revenue sources, including an increase in fuel taxes and a process for transitioning to a VMT-based user fee. We should not apologize for transportation investments as users finance the lion's share of them and expect us to invest them in sound projects.

3. Fund national transportation projects that promise the highest return for national goals. Special attention needs to be devoted to freight projects and projects that span multiple jurisdictions; these are otherwise disadvantaged in our overly formulaic surface transportation program.

4. Promote the integration of energy and environmental priorities (including climate change) in transportation decision-making. This can only occur by improving planning at the MPO and megaregion levels, and more diligently including aviation, freight and private stakeholders in these processes.

5. Reform U.S. DOT governance, by putting intermodalism (in all forms) back into U.S. DOT. The office should be again established in the Office of the Secretary with responsibility for representing passengers and shippers, creating a freight policy, and acting as the sponsor and overseer of multimodal projects. Staff capacity for freight issues, energy, and the environment also need to be augmented significantly.

For more see us at enotrans.com

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Reforming the Transportation Program: An Early Challenge for the Obama Administration

A reform of the federal surface transportation program is likely to figure prominently on the policy agenda of the Obama Administration. Rarely has there been so much agreement within the transportation community about the need to fundamentally restructure the program. “The transportation program has lost its sense of purpose and become nothing more than a vehicle for earmarks and revenue sharing,” goes a common plaint. Congressional lawmakers of both parties likewise agree that continuing the status quo is not an option. According to Committee Chairman James Oberstar (D-MN), the staff of the House Transportation and Infrastructure Committee is already hard at work developing a new surface transportation bill that promises to “look beyond the current program” and “rethink the existing program structure.” The Committee plans to release a detailed summary of its proposal early in 2009. If the Obama Administration wishes to influence the shape of the next legislation and participate in its development, it must start formulating its own legislative proposal almost immediately upon taking office.

The challenge is daunting. Drafting a multi-year authorization bill that aims to fundamentally revamp the existing approach will require a rethinking of many long-standing assumptions about program funding, structure and delivery methods. With a brand new team on board in the Department of Transportation, the task becomes even more challenging. Here are a few suggestions the new U.S. DOT team may wish to consider:

Consolidate te Program and Reform the Project Evaluation Process.
Today, the federal surface transportation program consists of over 100 different programs that have sprouted up over the past three decades. In addition, in 2007 the program contained 6,300 congressional earmarks many of which were for projects of purely local character. As part of the programmatic reform, the Obama Administration should propose collapsing these programs into a few program areas of significant national interest and concentrate federal funding on these areas. Such action would find support in President-elect Obama’s recent pledge to “eliminate spending programs that have outlived their usefulness, and reform others to ensure they are working in a cost-effective way.”

Four main program areas should constitute core of the future surface transportation program: (1) preserving, modernizing and improving the performance, reliability and safety of the Interstate Highway System (with incremental system additions to serve emerging population concentrations); (2) relieving congestion in major metropolitan areas; (3) establishing a national system of freight corridors with adequate capacity to accommodate the nation’s expanding economy and international trade; and (4) enhancing public transit viability in large cities.

To eliminate wasteful expenditures, the Obama Administration should propose reforming the process by which major investment decisions are made. Infrastructure investment decisions should be based on a systematic analysis of economic benefits to ensure that scarce resources are flowing to projects that benefit the public the most. This would suggest placing less future emphasis on formula allocations and targeting a greater proportion of funds on specific capital investments that meet national needs.

Establish a Capital Budget for Infrastructure: The National Infrastructure Bank
Future gasoline-tax receipts may not be sufficient to meet the projected capital needs of the federal surface transportation program, even assuming a reasonable increase in the federal fuel tax. What is needed is a new source of investment capital that would be dedicated solely to funding major transportation infrastructure projects. Such an entity has already been proposed, in the form of a “National Infrastructure Bank.” However, the precise way in which the bank should be structured remains to be determined.

An attractive model might be the Transportation Infrastructure Finance and Innovation Act (TIFIA). The TIFIA program, enacted in 1998, provides federal credit assistance to major transportation projects that generate a dedicated stream of revenue from user fees. The program is designed to fill funding gaps and leverage private co-investment by providing supplemental and subordinate capital. TIFIA assistance may cover up to 33 percent of eligible project costs and can take the form of direct loans, loan guarantees and lines of credit. Endowing the proposed National Infrastructure Bank with TIFIA-like authority while substantially increasing its capitalization and streamlining its currently cumbersome application process should be a leading model considered by the new Administration.

In recent days, sources close to President-elect Obama have suggested the possibility of a new stimulus package in the range of $500-700 billion. A conservative 10-15% allocation to infrastructure would immediately inject $50 to $100 billion into “ready-to-go” local transportation projects. However, this new money is likely to be allocated pursuant to existing allocation formulas and should not deter the Obama Administration from seeking a more permanent long-term source of investment capital to fund major infrastructure projects of national significance.

Implement a National Freight Transportation Program
The need to improve the nation’s freight transport system has been widely acknowledged in Congress as well as among stakeholder groups. Implementing a separate dedicated program to remove freight bottlenecks and expand freight-moving capacity in designated corridors should be an integral part of the Administration’s legislative proposal. The Department of Transportation, with the advice of states and the shipping and trucking industry, should be authorized to develop a plan for a network of national freight corridors that incorporate access to border crossings, container ports and intermodal facilities. The network should include “marine highway corridors,” a potential means of relieving highway congestion by shifting some container cargo from trucking to intercoastal and river- borne barges. The program should have its own dedicated source of funding, to be financed with freight-related charged and/or an increase in the federal diesel tax.

Enhance State-level capacity to fund infrastructure.
There are strong indications that state and local governments will have difficulty meeting their share of capital funding responsibility. That share, roughly 60 percent of total national capital investment, is funded through the state-level gas tax, vehicle registration fees, sales taxes and general revenue. New federal policies are needed to enhance the states’ capacity to raise additional capital funds. The most likely new revenue source is tolling. The Obama Administration should seek legislative authority (1) to permit states to toll newly constructed interstate highway capacity and existing interstate capacity in major metropolitan areas; and (2) to expand the existing program that allows the tolling of existing interstate highways for purposes of reconstruction and rehabilitation (currently the program is limited only to three projects). Additional incentives could take the form of “gap financing” for projects that cannot be fully supported through toll financing alone. To this end, new legislative authority should be sought to expand the availability of Private Activity Bonds (currently limited to $15 billion) and grants to State Infrastructure Banks to establish revolving credit programs to aid local and regional projects.

Encourage Private Sector Financial Participation
There is widespread agreement among the stakeholders as well as in Congress that private investment can play an important role in the national efforts to expand and modernize transportation infrastructure. Private sector participation typically can take the form of concession arrangements to finance, construct, operate and maintain new revenue-producing transportation assets such as toll roads and additional toll lanes on existing roads (so-called “greenfield” projects.) Another type of participation takes the form of long term leases to operate and maintain existing revenue-generating assets (so-called “brownfield” projects). The new Administration’s legislative proposal should contain provisions to encourage and facilitate private sector financial participation while ensuring that adequate safeguards are provided to protect the public interest.

The legislation should instruct the Secretary of Transportation to develop appropriate guidelines for states to follow in approving private concession arrangements. The public oversight should include all items of real concern (e.g., criteria governing the setting of toll rates, length of lease term, diversion of funds, revenue sharing, asset valuation, labor protections, non-compete clauses), but should not be so severe and onerous as to discourage private investors from assisting fiscally strapped state and local governments in their efforts to modernize and expand public infrastructure.

Facilitate a Transition to a Mileage-Based User Fee System
While the fuel tax should remain, in the words of Rep. Oberstar, “the cornerstone of federal transportation system financing” for at least the next two authorization cycles, there is widespread agreement that a fuel tax-based revenue system is not sustainable in the long run. Tax receipts are projected to fall short of the necessary revenue because of an expected decline in future motor fuel consumption due to increased vehicle fuel efficiency and policies encouraging energy independence and reduction of greenhouse gas emissions. Because a conversion to a user fee system based on vehicle miles traveled (and possibly vehicle weight) will take considerable time to implement, it is not too early to initiate the process of transition as part of the next surface transportation authorization. The transition program should include a focused research and development agenda, pilot programs testing alternative approaches to mileage-based user fees, and a detailed road map for phasing in a VMT/vehicle weight-based system, including the possibility of a staged phasing of different vehicle classes.

Note: While the views expressed above are my own, they have been influenced by the numerous reports, conferences, and congressional hearings I have covered as editor of Innovation NewsBriefs. I have benefitted also from conversations and interviews (both on and off the record) with a large number of individuals whose judgment I respect. Specifically, I have drawn on the work of the National Surface Transportation Policy and Revenue Commission and the National Surface Transportation Infrastructure Financing Commission (including conversations with individual Commissioners); on the recommendations of departing Transportation Secretary Mary Peters as summarized in the U.S. DOT report, “Refocus. Reform. Renew”; on discussions at the Brookings Institution and its report “A Bridge to Somewhere,” authored by Rob Puentes; on the testimony of numerous witnesses at recent congressional hearings; and on recommendations of various stakeholder groups and coalitions, notably AASHTO, the American Road and Transportation Builders Association (ARTBA), the U.S. Chamber of Commerce and the Bipartisan Policy Center’s Transportation Policy Project. Finally, I have looked for indications of congressional intent and found some interesting hints in various public remarks of House Transportation and Infrastructure Committee Chairman, Rep. James Oberstar (D-MN) and Highways and Transit Subcommittee Chairman Rep. DeFazio.(D-OR). The reflections offered above represent an amalgam of my own thoughts and the ideas obtained from these other sources.

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Top Five Priorities for Reauthorizing Surface Transportation Bill

1. Figure out a new funding source(s) for future transportation infrastructure improvements. Too many of the nation’s railways, highways, bridges, airports and neighborhood streets are slowly decaying due to lack of investment and strategic long-term planning. Last year, the Federal Highway Administration deemed 72,000 bridges, or more than 12 percent of the country’s total, “structurally deficient.” But the funds to fix them are shrinking and in September 2008, the Highway Trust Fund, which is funded by the gasoline tax, had a deficit which the Congress corrected with an $8 billion infusion. Vehicles are becoming more fuel efficient and in the next 5-10 years they are going to be powered by sources other than gasoline. It will be of vital importance to look at the amount of funds that can be generated by odometer readings or some alternative method, other than the gasoline tax which will not work for vehicles powered by electric batteries or hydrogen fuel cells. The reality is that regardless of new funding sources, the country’s infrastructure needs are going to continue to be about twice as high as the monies generated, and I believe public private partnerships will be increasingly used to bridge that gap. Elected and public officials must work to ensure that these public private partnerships are structured so that there is equity in the system, transparency to the process and benefit to the traveling public.

2. Focus more attention on environmental impact. There is a real need to look at rebuilding the nation’s infrastructure with green technology. One example is to look at upgrading the U.S. electric grid to advance clean energy development, as well as job creation.

3. Promote energy independence. Congress must look at ways to promote energy independence through planning, engineering and implementation of infrastructure that promotes smart growth and transit-oriented development (TOD). Old planning models focused on separate residential areas and commercial areas that forced people into cars to go about their business. New planning models should reflect the thought that is given to making transportation better and easier for people. Additionally, there must be investment in research and development of next-generation technologies, such as batteries for plug-in electric vehicles to help solve our country's energy crisis and limit our dependence on foreign oil.

4. Promote Intermodalism. By encouraging the use of sequential transportation modes (water, air and land), the surface transportation bill can promote energy-efficiency, as well as the most cost-effective methods to move goods.

5. Revise the funding formula. There needs to be a more fair and equitable distribution of monies to the states. The current formula creates a situation whereby some states contribute more tax money to D.C. than they get back in infrastructure funding, while other states receive more federal funding than they are contributing through taxes.

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Ours is a country whose success has come from the courage to try something new when the status quo isn’t meeting our needs. Independent experts agree our current approach to transportation isn’t working. Reform is needed to address exploding highway congestion, unsustainable gas taxes and spending decisions based on political influence instead of merit.

That’s why the Bush Administration offered a new framework for overhauling the way U.S. transportation decisions and investments are made, and did so expressly to spur debate about how best to incorporate new reforms and priorities into the next transportation bill. This new framework focuses on the most pressing surface transportation policy failures, and urges government to come up with workable solutions—not just throw money at the problem. If these reforms are embraced, I believe the next Secretary and the next Congress will have a unique and historic opportunity to dramatically change the course of transportation in America.

Safety is our core mission at the Department of Transportation. Measurable progress has been made, but we must refocus on safety by emphasizing new technologies, deploying data-driven approaches that tackle stubborn safety problems and giving states greater flexibility to address their specific safety challenges.

We must renew the federal focus on maintaining and improving performance on the Interstate Highway System and other nationally significant transportation assets. These roads are vital to the national economy, interstate commerce and global trade; ensuring the network is safe, well-maintained and un-congested must be a fundamental federal priority.

We must address the fact that many of our cities are literally choking on traffic. We need to tackle urban highway congestion, not simply slow it. To do that, the federal government should give state and local leaders new flexibilities and the ability to invest in projects that will make a real difference for commuters and businesses. In addition, the Federal government should seek formal partnerships (as we have done with our Urban Partnership Program) with metropolitan areas willing to pursue innovative approaches. To this end, we proposed creating a Metropolitan Innovation Fund that rewards cities willing to combine the powerful mix of effective transit investments, dynamic pricing of highways and new traffic technologies that we know will cut congestion and reduce commute times and greenhouse gas emissions. There are very few win-win policies in transportation, but this is one of them.

We must create real accountability and performance measures to ensure investments in transportation will actually deliver results. In recent years, transportation spending has increased by over 100 percent, but congestion has increased by 300 percent. We need to define success in terms of increased travel time reliability, decreased delays and improved condition of bridges and pavement—not just dollars spent. Instead of spreading funds across the 102 various transportation programs that have been created over the last two decades, we should focus on a limited number of spending programs that make the most effective and efficient use of federal funds.

Finally, we must transform the way we invest in transportation. We must begin the process of weaning ourselves from unsustainable gas taxes, especially at a time when our country is seeking to reduce fossil-based fuel consumption. We must give states more flexibility to implement electronic road pricing, to expand use of federally backed transportation loans, to create state infrastructure banks, and to attract the billions of private sector dollars available for transportation projects. Countries around the world have successfully embraced these concepts in recent years, and the U.S. is at risk of falling behind if we cling to the status quo. We must also find more creative ways to protect the environment and ensure public input without taking 10 years on average to design and build major new highway and transit projects, as it does today.

The next transportation bill provides an incredible opportunity. We can create easier, more sustainable ways to pay for and build roads and transit systems, delivering fewer traffic tie ups, better transit services, a stronger economy and a cleaner environment. We can make our roads and bridges even safer. And we can restore Americans’ confidence that transportation investments will deliver results.

Visit www.fightgridlocknow.gov to learn more about the Administration’s transportation reform proposal, and check out DOT’s blog at www.fastlane.dot.gov.

Updated Dec. 2 at 10:35 a.m.

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