January 23, 2009
  

A Stimulus For States and Regions To Own Surface Transportation

Matt Rosenberg

The much-hyped federal economic stimulus package isn't looking like it will do all that much for surface transportation. The New York Times reports that the House stimulus bill contains a scant $30 billion for roads and bridges and $10 billion for transit. Turns out most of the infrastructure spending in the bill is not for surface transportation. The new administration has weighed in, supporting the bill. Washington State would get $530 million for highways, roads and bridges and $216 million for transit from the bill, according to D.C. correspondent Les Blumenthal. To put that in context, we have about $38 billion in unmet transportation funding needs, as shown on p. 5 of this overview from the Washington State Transportation Commission.

On the way to final passage, the federal stimulus bill's funding level for surface transportation nationwide could be tweaked somewhat, with more coming to our state and others. But not a lot more. As the Wall Street Journal reports, among House members the hoped-for level of surface and air transportation combined spending in the stimulus bill topped out at $85 billion, and a key committee chairman was eyeing a more achievable $53 billion. The $85 billion (including air transport) would be less than one-quarter of the estimated annual nut to address national surface transportation needs for each of the next 50 years (air transport not included). Even assuming that best-case, one-time $85 billion jolt, plus an envisioned federal infrastructure investment bank and the surface transportation bill re-authorization this coming autumn, the gap between what states need and what the feds can supply will be vast in coming decades.

It's true that a proposed U.S. infrastructure bank could raise some $60 billion over 10 years for deserving projects. That'd be a start, but as Congressional Quarterly reports, the National Surface Transportation Policy and Revenue Study Commission in a major report issued (in 2008) said $225 billion per annum is needed for the next 50 years for repairs and upgrades to meet future needs. That's $12.5 trillion. The commission noted that current expenditures are less than 40 percent of their recommended yearly nut, and that future funding will need to be closely tied to cost-benefit analyses and performance-based outcomes.....The commission's scarifying estimate dovetails, roughly, with one by the American Society of Civil Engineers that just to get moving on vital projects, the nation's infrastructure needs an infusion of $1.6 trillion over the next five years.

As you'll see toward the bottom of this recent report from the Houston Chronicle, the Congressional Budget Office projects the federal highway fund will run out of money by this year's end, likewise the federal transit fund by 2012. An increase in the federal gas tax is seen by some as partial remedy, but with government and consumers moving steadily toward ever more fuel-efficient vehicles, this by-the-gallon tax will have a diminishing yield even if the huge political barriers to raising it can be surmounted.

Which brings us to the multi-faceted Cod Liver Oil Solution. One part is exploration of a vehicle-miles travelled tax, certain to bring out the musket-bearers in the near term, but probably one key element - here and elsewhere - in the long term. Another piece, already taking shape, is networks of time-variable tolled lanes in metro regions. The Bay Area is among a number of regions nationwide beginning to roll out that strategy; it is distinct there from a smaller and more controversial initiative to impose a pricing cordon around the central city aimed at individual drivers. Arguing in the journal Mass High Tech that regional time-variable electronic tolling systems are smarter than hitching our wagon to the dying gas tax is Craig Carlson, director of Cambridge Consultants. These "fast lanes" raise maintenance and operations funds directly from users - but even more importantly, help control peak hour use by solo drivers while transit and ride-share vehicles go free. If you're still skeptical, at the New York Times' "Freakonomics" blog UCLA researcher Eric Morris explains why free highway lanes recall the Soviet food lines of yore.

Similar perspectives are beginning to take root in The Evergreen State, in practice and in theory.

One important indicator of where the thinking on best practices is heading comes from our state transportation commission, which recently unveiled its 2009 policy platform. Scroll down to "priority policy issues." Among the key recommendations for legislators to consider are further development of regional tolling, and - take a deep breath - a West Coast pilot project to test out a vehicle-miles-travelled tax. The commission, whose statutory duty is to advise the legislature on transportation and to approve toll rates, is also keen on a carbon tax structure for the state and eventually nation, which rewards greener vehicles. Some of their policy priorities, in their words:

  • A Vehicle Miles Traveled (VMT) based system in which drivers pay for the miles they drive with per-mile rates varying according to location, time of day, and day of week is a technically feasible approach. However, it appears doubtful that one state can implement such a system on its own. While there are serious political challenges with such a concept in the short term, the topic is gaining interest nationwide and is actively being discussed in Washington, D.C. One possible approach ...would be to implement a federally funded pilot VMT-based project on the West Coast - perhaps an I-5 "Corridor of the Future" project. This idea is advocated by the West Coast Transportation Commissions.
  • Tolling and congestion pricing should be applied over time where appropriate, to transportation facilities as identified in the Commission's 2006 Tolling Study. (Parts 1 and 2 here). Pricing has been proven to be an effective means to manage congestion, maximize the efficient use of scarce transportation resources, and reducing VMT which carries climate change benefits. Tolling has these effects in virtually all cases in which demand out-paces capacity, including both highways and ferries. Indeed, the recent experience in the United States with relatively high gas prices began to demonstrate the impact of pricing on personal transportation decisions. We must act now to move critical tolling projects forward.
  • Consider imposing a state carbon tax structure based upon vehicle type. Ordinarily this concept would be a long term notion in this country and in Washington State. However, such taxes are being implemented in other parts of the world and should be acted upon in the near future in this state and nation.
  • The commission also urges a closer look at strategies including these:

  • Increase vehicle registration fees.
  • Reinstitute some form of a value-based vehicle "excise tax" with a reasonable depreciation schedule.
  • Explore, using cost-benefit analysis, public/private partnership investments in delivering capital construction projects and how such investments can be employed to help shape our economic and environmental future around sustainable mobility.
  • The commission discusses a range of additional strategies highlighting environmental concerns and the crucial role of transit. Legislators will need to ensure that some judicious share of new road revenues is directed to transit in major metro regions, so that better alternatives exist for those who'd like to sidestep expanded road pricing when their schedules permit.

    Drawing on the transportation commission's 2009 policy priorities, Washington state legislators and Governor Chris Gregoire can help pave the way for a new breed of revenue solutions to our long-neglected and growing surface transportation needs. These solutions in turn can help meet - and disperse - the future transportation funding obligations of a state now badly overextended, while simultaneously fueling our economic engine.

    1:46 PM |

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