December 2012 Archives

Cliff metaphors abound these days, thanks to our members of Congress. In my travels, I've run across the deportation cliff, the human cliff, and yes, the transportation cliff. (Thank you, Rep. John Mica, R-Fla.). To be clear, there are two cliffs in the transportation world. There is the "fiscal cliff," which would result in an overall cut of about 8 percent in federal funds. That impact on transportation isn't clear, although it would certainly be a blow. The National Air Traffic Controllers Association says that could result in a furlough of 2,000 to 2,200 air traffic controllers, which could ultimately result in fewer flights.

Then there is the approaching 2014 sunset of the surface transportation law, which seems far away but is still of concern for state transportation officials trying to plan out their budgets for major projects. Don't expect action on that one anytime soon, although lawmakers say they're ready to get going next year.

Still, the economy for transportation is picking up slightly. Last week, the American Road & Transportation Builders Association released their 2013 forecast of the construction market, predicting modest growth from $126.5 billion to $130.3 billion. That's not bad, all things considered. Even more interesting is that ARTBA's economists say the "major wild card" of the fiscal cliff would only impact transportation investment indirectly. That's not to say the impact couldn't be dire, but at this point it can't be quantified. All we know is that state and local governments may be forced to pull back on some projects and that individual businesses may delay capital investments or hiring because of uncertainty.

President Obama has asked for $50 billion to invest in infrastructure as part of a cliff deal, although that request has been repeatedly shunned by lawmakers. It's easy to see them shunning it again. But if they wind up getting a fiscal cliff deal anyway, the DOT's TIFIA loan program will probably hum along smoothly, as will the regular federal funding mechanism. All will be well, right?

People in Washington D.C. are obsessed with the fiscal cliff, but let's move the discussion beyond that. What are other risk factors to infrastructure in 2013? What is the best prediction of how the fiscal cliff negotiations could impact transportation? How important is it for the construction industry to watch Congress next year? Where will the infrastructure economy grow? Where will it shrink?

3 responses: Patrick D. Jones, Gabriel Roth, Emil H. Frankel

"Trying to market a city without transit is like trying to sell a cell phone without a camera." That was one of the take-home messages from a speaker at an urban planning conference earlier this year, according to my friend who was there. The room was full of city planners who are trying to convince businesses to settle in their areas. Transit is considered key not just because it gives people an easy way to get to work, but it also signals to the private sector that a city is healthy enough to invest in itself.

This week, the American Public Transportation Association released its third quarter ridership report, showing seven consecutive quarters of ridership growth on subways, buses, and commuter rail. There have been 7.9 billion rides from January through September of this year. If the trend continues, it will amount to 10 billion rides by the end of the year. "That's real numbers. These are impactful numbers," said APTA President Michael Melaniphy. "It's not just an urban phenomenon. Cities under 100,000 people are seeing good growth. Demand is pushing the capacity of what they can handle." Almost 60 percent of transit rides are work commutes, according to APTA, and cities are looking for ways to give workers on swing shifts access to their jobs.

Melaniphy believes the public and local leaders are way ahead of Congress in terms of willingness to finance transit. APTA spent much of the last year simply trying to protect existing federal funds from being cut in a two-year highway bill. Around the country, the attitude was different. In 2012, local initiatives to tax more for transit had a 79 percent passage rate. Last year, the rate was 76 percent. "The mayors get it," Melaniphy said. The state of cities' transit systems are among the top five questions asked of city officials by businesses looking to locate there.

What is transit's role in the economy? How important is it to job growth? We know transit is essential in densely populated areas, but how can it be useful in less densely populated areas? Should transit systems prioritize work commutes over other kinds of travel? How should cities and towns develop and market their transit systems? What is the future for transit?

2 responses: Peter Gertler, Deron Lovaas

Rep. Bill Shuster, R-Pa., will be the next chairman of the House Transportation and Infrastructure Committee, and he is a good choice for House Republicans. He is firmly in the conservative fiscal camp and unafraid to say so. He was among the few House members who lingered in the lobby outside the House floor Friday trashing President Obama's recent proposal to avert the "fiscal cliff." He said it would do nothing to solve budget problems. Obama included a $50 infrastructure bank in the proposal. Shuster rejected it with a wave of a hand. There will be no "stimulus," even for infrastructure, in the final budget package, he said.

Shuster enters his chairmanship with the same problems confronted by the outgoing chairman, Rep. John Mica, R-Fla., who found himself hamstrung by Republican leaders who wouldn't allow any extra money to be spent for the nation's surface transportation system. Despite Mica's best efforts, House members' inability to agree on a trimmed-down five-year highway bill left the chamber at loose ends when it came to negotiations with the Senate. They managed to eke out an agreement on a two-year measure that barely covers costs.

"They're all difficult lifts," Mica said of the transportation chief's role these days. Gone are the salad days of his predecessors--former Reps. Don Young, R-Alaska, and Bill Shuster's dad, Bud Shuster, R-Pa.--who had the power to craft massive highway bills with lots of pet projects tucked in to sweeten the deal.

Mica predicted that Shuster has four years to get his ducks in a row for the next highway bill, even though the current measure expires at the end of 2014. "But remember, it takes a year to two years after that to do a bill," Mica said. "Hopefully we'll get the fiscal issues resolved by then."

That's a big if, but Mica is right that anything can happen in four years. For now, Shuster can content himself with batting down the president's ideas. (How many times has Obama's infrastructure proposal been offered and rejected?)

What should committee members be focusing on next year when it comes to transportation? Will it really be another four years before a highway bill gets done? Will a new chairman breathe life into the committee? How should legislators confront the niche transportation issues like rail, transit, and aviation? What makes a good transportation leader?

5 responses: Bill Lind, Mark Aesch, Jack Schenendorf, Gabriel Roth, Kurt J. Nagle