September 2012 Archives

Whether building highways or dredging ports, environmental regulations are often cited as a drag on progress for all modes of infrastructure. On one hand, such rules help to limit the negative impact industries and projects have on natural resources. On the other, they can slow down progress. But is there a role for public-private partnerships in pushing industry toward reducing its environmental footprint?

Last week, Boeing, in conjunction with American Airlines and the Federal Aviation Administration, showed off a new airplane, ecoDemonstrator, featuring a set of environmentally friendly technologies. The technologies help "make airplanes operate more efficiently and produce fewer emissions and less noise," said John Tracy, Boeing chief technology officer. And it was made possible, in part, by funding from the FAA's Continuous Lower Energy, Emissions, and Noise (CLEEN) program.

The impact of a single souped-up plane is, of course, negligible. But the effort highlights a potential alternative means of achieving what regulations set out to do: getting industry to reduce its footprint.

In this case, Boeing was able to develop a plane that reduces fuel costs and increases efficiencies. Are there other examples of airline industry PPP's that have achieved similar goals? Or is such a win-win a rarity with public-private partnerships--all smoke and no fire? Is there something to be said for leveraging PPP's to induce industry to achieve regulatory goals?

3 responses: Nicholas Calio, David Pickeral, Billy Glover

For cash-strapped states, all hope isn't necessarily lost.

Despite shrinking federal funds, innovative tools such as revolving state loan funds present "an increasingly important mechanism for financing and funding infrastructure projects such as state infrastructure banks," according to a Brookings report out last week.

The way such loan funds are implemented is far from perfect, Brookings found, but they can represent an important means of delivering infrastructure projects. The short report walks through how the funds are structured in various states and how they can be improved on. For one, many state infrastructure bank officials say complying with federal environmental and contractual regulations can slow down the investment process--a problem that could be magnified for states with smaller projects and less-developed banks of their own.

A national infrastructure bank, as proposed by the administration, could help relieve states of some of those problems by offering expertise in dealing with complex regulations and project delivery, the report found.

Such loan funds and infrastructure banks may just be tools in states' infrastructure project delivery arsenals, but they're tools that can be sharpened and strengthened. Is there a broader role the federal government can take in fostering innovative financing like these funds? If so, how? What more can states do? Or is this barking up the wrong tree?

2 responses: Laura Barrett, Gabriel Roth

There were wonky, late night transportation receptions--invite only--at both the Democratic and Republican national conventions that blanketed the political news over the last two weeks. I cover transportation and I wasn't at either one of them. When I surfaced from my convention travels and odd stories about delegates, I wondered what I had missed.

I missed nothing. The word "infrastructure" and "transportation" were absent from both President Obama's and Republican nominee Mitt Romney's convention-capping speeches. Obama once mentioned "rebuilding roads and bridges; schools and runways." Romney didn't mention them at all. The closest we got to a conversation about transportation from the convention podiums were in references to the auto bailout, either as a taxpayer waste or a financial savior, depending on the point of view.

The political platforms were better. They stated each party's point of view on infrastructure, but they offered no surprises. There was very little debate about any of the points during the platform drafting sessions. The Republican platform calls for public-private partnerships and more responsibility from states. It stops short of saying the highway trust fund is sufficient to fund our transportation needs, as some Republicans believe, but it warns of "hard choices" on budgeting.

The Democratic platform calls for immediate investment in roads, highways, and bridges, as President Obama has sought every year since he took office. It also calls for an "infrastructure bank" that will prioritize projects that offer the most bang for the buck.

That's a pretty poor outing for an issue that is generally bipartisan and popular. Transportation is also an area where investments clearly would boost job growth and strengthen the country's economy for the long haul. Why doesn't anyone care? Did the highway bill talks sap everyone's strength? What would make for memorable transportation talking points during this election? Does the issue resonate at all with the public? Or does it make more sense to focus advocacy efforts away from the spotlight and on the key decision-makers? Where's the love?

3 responses: Nicholas Calio, Laura Barrett, Emil H. Frankel

With Labor Day here, now seems as good a time as any to revisit a constant tension: how to protect infrastructure jobs without restricting innovation.

Last week, the American Association of Port Authorities invited a handful of journalists to tour the Port of Virginia, including the recently built and highly automated APM Terminal there.

The automation has allowed the port to optimize its operations, with giant machines rearranging cargo throughout the night so it can quickly and efficiently be loaded onto ships the next day. Ports in Canada and Mexico have pursued similar automation, port officials said. A failure to adapt amounts to surrendering business to the competition.

But the innovation leaves some workers behind: with the technology in place, the terminal operates with about half of the workforce it would otherwise need, they said.

"We were very careful to include the [International Longshoremen's Association]," one official said. "Many of the workers who were displaced, do eventually get retrained."

Still, the operation underscores a tension for all modes of infrastructure. Advancement can have a positive effect over the long-term, but what can be done for workers in the short-term? Can policies help to ease the pain and transition workers to new jobs without holding companies back? Are there any models for protecting and fostering both jobs and innovation?

1 response: Mark Aesch